Amazon's biggest rival offers a near-identical alternative in three-quarters of cases but huge issues remains

(Image credit: Temu)

Lookalike products on Temu spark authenticity concerns
Temu’s review system faces scrutiny amid signs of manipulation
Price alone won’t dethrone Amazon - Temu must earn consumer trust

Chinese ecommerce giant Temu has emerged as a strong competitor to Amazon by offering significantly lower prices on a wide range of products in recent months

A new Omnisend report has claimed Temu’s prices are, on average, 40% lower for items closely matching Amazon listings. The site relies heavily on discounts to attract shoppers, with around 65% of its listings featuring markdowns, compared to 47% on Amazon, with some items seeing price cuts as high as 98%.

Temu has gained traction in budget-friendly categories such as clothing, shoes, jewelry, and beauty products, where it offers cheaper alternatives to Amazon. The overlap in these categories is high, with a 94% match rate for items listed on both platforms. However, despite its aggressive discounting, it has yet to surpass Amazon in consumer trust and product transparency, which may limit its ability to shift customer loyalty.

Pricing strategies and consumer perception

Amazon remains dominant in trust-sensitive segments like automotive products, where it consistently offers lower prices - being about 12% cheaper than Temu. Shoppers also favor Amazon for food and beverages, where Temu’s match rate is the lowest.

Amazon also holds an edge in electronics and home appliances, where factors like warranties, reliable reviews, and trusted customer support play a significant role in purchasing decisions.

It also maintains an advantage in consumer trust, partly due to its robust review system. The average Amazon product has around 50,000 reviews, while Temu listings typically have only 1,500.

Researchers have found signs of possible review manipulation on Temu, such as disappearing negative reviews and low-rated products being reuploaded under new listings. While Amazon also faces issues with fake reviews, its enforcement measures are more transparent.

Meanwhile, many Temu listings closely resemble well-known brands but feature altered packaging or blurred logos, raising doubts about authenticity.

Ultimately, Temu’s ability to compete with Amazon depends not just on lower prices but also on building credibility. While deep discounts attract budget-conscious shoppers, trust and reliability remain crucial for long-term consumer preference.

On the subject of trust - Temu and similar marketplaces have attracted millions in the last year, but, in September 2024, Temu denied a data breach relating a database containing 87 million users' personal information.