Temu Slashes Ad Spend Ahead of De Minimis Closure

Meghan Hall

Fri, Apr 18, 2025, 11:54 AM 4 min read

Global trade tensions seem to be bringing change inside low-cost, China-founded e-commerce platforms, particularly Shein and Temu.

That has seen the two companies reevaluating their strategies in several ways—one of which is, reportedly, decreasing their respective advertising spending in the U.S. market, and another of which is hatching plans to increase prices on goods sold on their respective sites and apps.

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Those decisions come against a tense trade war between the United States and China, which has seen triple-digit tariffs imposed both on goods entering China from the U.S. and on goods entering the U.S. from China.

In the days following Chinese President Xi Jinping and U.S. President Donald Trump’s tit-for-tat tariff schemes, Temu significantly decreased its ad spending; data from Tinuiti, a marketing firm, showed that Temu purchased one-fifth of all U.S. Google Shopping ad impressions on April 5. By April 12, Temu had decreased its spending to zero.

Retreating from advertising seems to have cost the low-cost marketplace in terms of new customer acquisition; while the Temu app has long been one of the most popular apps among U.S. Apple Store users, its rankings slid, indicating less consumer awareness or interest in downloading the app.

According to Sensor Tower, which tracks app data, as of Friday, Temu’s Apple Store ranking had hit No. 73 for category-agnostic, free apps downloaded by iPhone users and No. 10 among free shopping apps downloaded by iPhone users. That’s down from April 9, when it ranked No. 9 among all free apps downloaded by iPhone users and No. 1 for free shopping apps downloaded by iPhone users.

And it appears Shein has started taking the same approach, according to a LinkedIn post from Mike Ryan, head of e-commerce at SaaS company Smarter Ecommerce.

“Another one bites the dust: Shein has now exited Google Shopping in the US, following closely on the heels of Temu. From an ad spend perspective, these are very tall dominoes that are falling,” Ryan wrote on LinkedIn Friday.

As of Friday, per Sensor Tower, Shein ranked No. 73 among all free apps downloaded by iPhone users, down from No. 12 on April 9, and No. 9 among free shopping apps downloaded by iPhone users, down from No. 2 on April 9.

Neither Temu nor Shein have come out and explained their decisions to decrease ad spend. But both companies have made it clear that they’re going to change their strategies due to global trade disruptions.

Both companies alerted customers this week that they would begin increasing prices, effective April 25, citing “recent changes in global trade rules and tariffs,” which both companies said saw their operating expenses increasing.

That’s likely a nod to Trump’s plan for the de minimis exemption, which currently allows goods valued under $800 to enter the U.S. without duties. Trump signed an executive order earlier this month that is slated to end de minimis entries for goods inbound from China and Hong Kong, effective May 2.

Both Temu and Shein ship many of their products directly to consumers from facilities near factories in China, which means that direct-to-consumer shipments that can currently be brought into the U.S. with de minimis entry will soon pay the going tariff rate, if not sent via international post, or will pay an ad valorem rate or flat fee per package, if sent via international post.

Temu’s business model differs from Shein’s in multiple ways, the most notable being that Temu doesn’t sell any of its own products; it’s solely a marketplace. While Shein has a marketplace, it also sells Shein-branded products.

Temu has also worked to build out a network of local warehouses, particularly in the U.S., which means that its sellers may be importing goods en masse to be shipped domestically to the end consumer, whereas Shein focuses on direct-to-consumer shipping from China. Soon, either strategy will see sellers paying duties on goods imported into the U.S.

That Shein and Temu have announced price increases while simultaneously decreasing ad spend may be indicative that the companies are either becoming more conservative with their capital amidst trade uncertainties, or that they are shifting their interest to other markets outside of the U.S.

Both companies have been looking to rapidly expand, and Temu recently announced that it would expand its partnership with DHL in an effort to gain stronger footing in Europe, the Middle East and Africa. In that announcement, Temu noted that it expects 80 percent of its total European sales to come from its local-to-local model in the future.

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