Attack on Amazon

The Chinese online retailers Shein, Temu, and Alibaba have set their sights on the European e-commerce market

The Chinese online retailers Shein, Temu, and Alibaba have set their sights on the European e-commerce market, aiming to challenge Amazon's dominance in the region.

So far, Amazon has been the undisputed leader in e-commerce in Germany. Neither heavyweights like Zalando nor Otto could pose a threat to the US giant. But now, the three fastest-growing Chinese online retailers - Shein, Temu, and Alibaba - have launched an offensive in Europe, strategically targeting Amazon's core business.

Peter Pernot-Day, the Global Chief Strategy Officer of Shein, emphasized in a conversation with Handelsblatt that Shein will further expand its presence in Europe and pursue ambitious goals. An important step in this endeavor is the introduction of a marketplace model in Europe, similar to what exists at Amazon. Shein plans to include external brands on its platform, thus evolving into a marketplace.

The Chinese contenders - Shein, Temu, and Alibaba - are leveraging their strengths in data utilization, algorithms, and Artificial Intelligence (AI). With the help of these technologies, they can track new product trends in real-time, especially through social media analysis. They order directly from manufacturers in China, enabling them to offer sought-after new products within a matter of weeks. This allows them to provide competitively low prices and respond flexibly to demand.

Particularly Temu, which is already active in many European countries, has specialized in the younger target audience and entices customers through social media to its app. Experts see Temu as a particularly strong competitor to Amazon, as it acts like an entertaining casino with targeted offers, giveaways, and a wide range of products.

Alibaba, the Chinese commerce giant, also plans to bring its platform Tmall to Europe. Tmall is considered one of the most advanced and established platforms among the three. With its extensive experience and existing infrastructure in Europe, Alibaba has already gained the trust of Western brands.

Although the Chinese contenders are formidable competitors, they might face some challenges. For instance, Shein and Temu primarily offer Chinese budget products in Europe, which could raise concerns about quality and lead times. However, they are working to improve delivery times by opening distribution centers in European countries.

All in all, the introduction of these Chinese e-commerce giants in Europe is reshaping the market and could pose new challenges for Amazon. It will be intriguing to observe how the competition between these giants unfolds and what impact it will have on e-commerce in Europe.

Read the full german article with our founder and CEO, Damian Maib, on Handelsblatt