Traditional retailers like Amazon and Walmart face challenges dominating the children’s toy market. Temu and Shein are stepping up their efforts to capture this audience.
Reuters reports that the Chinese e-commerce giants are expanding aggressively into the toy market and might give traditional retailers a run for their money.
Young adult European shoppers are increasingly buying toys on Temu and Shein, according to a September study by Circana.
Temu has seen an increase in toy searches lately, while Shein’s toy section is one of the fastest-growing categories, according to the site.
Entrepreneurs worried about Temu and Shein
If Temu and Shein leave their stamp on the toy industry, it could signal a shift in consumer behavior.
Why? Shein and Temu are leveraging low-cost, high-volume models. This is to undercut traditional industry players.
Convenience and affordability have already redefined industry standards since Temu and Shein entered the e-commerce space.
These developments can disrupt local businesses reliant on niche toy markets, forcing them to rethink pricing and distribution strategies.
Shein and Temu’s impact on toy entrepreneurs
Three main factors can impact competition for entrepreneurs: increased pressure on margins, trust, and market dominance.
Increased pressure on margins
Temu and Shein are known for their cheap fast-fashion and cosmetic products. Entering the toy section will make it even harder for smaller businesses to compete.
Their cheap, unbranded products often attract price-conscious customers. This leaves entrepreneurs with slimmer margins to match their unsustainable pricing models.
Trust concerns and fake products
Counterfeit and low-quality items on these platforms tarnish the market’s trust. The two rivals are already picking on one another when it comes to selling sub-standard products.
Temu is suing Temu for copyright infringement, alleging that the retailer pretends to be an online marketing place by copying products sold by Shein.
Market dominance
Both platforms are targeting younger and lower-income consumers, expanding their customer base.
Entrepreneurs need to strategize how to reach these groups while maintaining brand integrity.
NOW READ: More calls for investigations into Temu and Shein
About the author
Mia is a multi-award-winning journalist. She has more than 14 years of experience in mainstream media. She's covered many historic moments that happened in Africa and internationally. She has a strong focus on human interest stories, to bring her readers and viewers closer to the topics at hand.
