Temu Reaches 24% of Cross-Border Shopping as Amazon Expands Its Budget Rival

A rapid rise brings Temu close to Amazon

Temu has reached 24% of worldwide cross-border e-commerce, according to a survey published by the International Post Corporation (IPC), bringing the shopping platform owned by PDD Holdings close to Amazon's reported share of 24% to 25%. Temu's share rose from less than 1% when it launched in 2022 to 24% in 2025. Amazon held 25% in 2024, compared with 26% in each of the two preceding years.

The IPC, an association representing 26 national postal services across Europe, Asia-Pacific and North America, surveyed 30,970 people in 37 countries, including the United States, France and Australia. Its findings describe cross-border shopping, where consumers buy goods shipped from another country, rather than every kind of online retail purchase.

As of January 20, 2026, the competition is moving on two fronts. Temu is attracting shoppers with very low prices and an app built around discounts and games. Amazon is expanding its own budget services, Haul and Bazaar, while relying on the delivery network and customer loyalty that support its main business.

Other retailers are under pressure too. IKEA recorded a 26% fall in profit after cutting prices to stay competitive. eBay lost 68% of its cross-border business between 2018 and 2025, leaving it with a 5% share last year. Those figures show that the contest extends beyond the two largest names in this survey.

Temu's rise in three years represents a sharp challenge to Amazon's longstanding position. The central choice for many shoppers is straightforward: pay less and wait longer, or pay for the speed, convenience and service they already know.

How Temu made low prices its main attraction

Temu sources products from Chinese manufacturers and sells them to consumers at prices often two to three times lower than comparable products on Amazon. Some items cost as much as 10 times less. A charging station for Apple devices, for example, can cost between $20 and $50 on Amazon and approximately $10 on Temu.

Those differences appeal to people who place price ahead of rapid delivery, particularly shoppers outside the urban, affluent groups often targeted by traditional e-commerce platforms. For a purchase that is not urgent, a longer wait can become an acceptable part of the bargain.

Temu has backed those prices with billions of dollars in digital advertising. It spent nearly $2 billion on Instagram and Facebook advertisements alone last year. Its Super Bowl commercials in 2023 and 2024 used the slogan "Shop Like a Billionaire," helping the platform reach 88% brand awareness among American consumers, according to a YouGov survey.

Holger Winklbauer, chief executive of the International Post Corporation, described the growth in Chinese exports and the changes affecting their delivery:

Chinese e-commerce exports, especially from Temu, have significantly increased in the past three years,

The global e-commerce supply chain is evolving due to customs changes in 2025 and into 2026.

Temu now has more than 110 million active users globally. Amazon has 170 million Prime subscribers, reflecting the large customer base attached to its membership service. Active users and paid subscribers measure different kinds of customer relationships, but both figures help explain the scale of the businesses competing for purchases.

The shipping model behind the discounts

Temu's approach shortens the route between Chinese manufacturers and shoppers. The conventional Amazon route described here runs from supplier to seller, then to an Amazon warehouse and finally to the customer. Temu's direct shipping approach reduces the number of intermediaries and avoids warehousing costs in destination countries.

Many Temu suppliers also use just-in-time production, making goods after orders arrive. Producing against an order reduces the risk of holding stock that may never sell and lowers the amount of money a manufacturer must commit before receiving demand.

Temu combines those savings with bulk shipping advantages and trade exemptions. Together, they have allowed it to operate on very thin margins while charging less than competitors. A margin is the amount left from a sale after costs, so a small increase in shipping or customs expenses can matter greatly when that amount is already low.

The platform also uses a "fully managed" marketplace model. Merchants agree on a sale price and send products to Temu's fulfillment centers. Temu then handles shipments to consumers. Direct sourcing therefore still involves centers that organize and dispatch goods, even when products avoid warehouses in the customer's country.

Manufacturers gain relief from handling warehousing, shipping and customer service themselves. The arrangement has helped attract suppliers, although it has also prompted concerns about how much profit those suppliers retain. Temu's low consumer prices depend on the costs and earnings of every business along that route.

Amazon takes Bazaar into more markets

Amazon expanded its budget shopping service, Amazon Bazaar, to 14 additional markets in November 2025, including Hong Kong, the Philippines, Nigeria and Taiwan. The service is known as Haul in the United States.

Bazaar is a standalone app with merchandise similar to Amazon Haul, the budget shopping section within the main Amazon app launched last year. Its products cost less than $10, with some priced as low as $2, across categories including home goods and fashion. Bazaar began in Mexico before expanding to Saudi Arabia and the United Arab Emirates.

Gil Luria, an analyst at D.A. Davidson & Co, described the expansion as part of Amazon's wider international strategy:

Amazon Bazaar's expansion is an important step in Amazon's international expansion,

Amazon has only entered a market when it believed it can scale up to a level where it delights consumers and builds a profitable business.

Amazon reported international revenue of $40.9 billion for the third quarter, an increase of 10% from the previous year when changes in foreign exchange rates are excluded. Leaving out currency movements helps show how much the business grew without gains or losses caused by converting sales into another currency.

Amazon's budget strategy draws on its existing global fulfillment network. Products move from international centers to consumers through service partners. The company is trying to combine prices closer to Temu's with the operational reliability shoppers associate with Amazon.

Price, speed and product information

Amazon Haul offers a mobile-only shopping experience with a separate interface designed for quick purchasing. Its simpler presentation contrasts with Temu's spinning wheels and other game features, which encourage shoppers to spend more time in the app.

Haul's streamlined format can also mean less information before a purchase. In many cases, shoppers encounter shortened product descriptions and no customer reviews. Those details matter when a buyer is choosing an unfamiliar, unbranded product rather than something already known.

Some analysts see Haul as a way to separate inexpensive, unbranded goods from Amazon's main shopping experience. Moving products that do not meet the main platform's quality standards into a different section could help protect its reputation for reliability while allowing it to compete on price.

Others worry that the budget section could acquire a "dumping ground" image and weaken trust in the Amazon brand. The business decision is therefore about more than lowering prices: Amazon must also manage what customers expect from products carrying its marketplace name.

Delivery times create another division between the services. Amazon promises delivery within one to two days, sometimes as quickly as eight hours for Prime members. Temu shipments typically take between four and 22 days. For many shoppers, the platforms serve different needs rather than replacing each other completely.

Customs changes put the low cost model under strain

Temu and its smaller competitor Shein benefited for years from the United States' de minimis exemption. Under that rule, packages valued below $800 could enter the country without import duties. It supported direct shipments from Chinese factories to American consumers without tariffs or extensive customs inspections.

The September 2025 revision attributed to the Biden administration required Chinese sellers to pay tariffs and duties on shipments regardless of their value. The change removed the exemption behind a major pricing advantage for very cheap imports.

New requirements also called for Chinese sellers to provide detailed tariff classification numbers and for consumers to disclose personal identification information for imports. Classification numbers tell customs authorities what type of product is entering the country so they can apply the relevant trade rules.

Representative Mike Gallagher criticized the use of the exemption by the two platforms:

Temu and Shein are building empires around the de minimis loophole in our import rules—dodging import taxes and evading scrutiny on the millions of goods they sell to Americans,

The European Union has introduced a flat fee of 3 euros for each small parcel valued below 150 euros arriving from outside the bloc. Together, the American and European changes have pushed Chinese shopping platforms to adjust their supply chains, increasing logistics costs and potentially raising consumer prices.

Friedrich Schwandt, chief executive officer of ECDB, described the pressure in a news release:

2026 will be their toughest year yet—not because of competition, but because of tariffs and trade regulations that cut to the heart of their model,

The dates behind the competition

Temu's growth and Amazon's response unfolded over several years. The advertising campaigns, market expansion and customs changes help explain how the contest reached its current stage.

• 2022: Temu launched with less than 1% of cross-border e-commerce share.
• 2023 and 2024: Temu ran Super Bowl commercials using "Shop Like a Billionaire."
• 2024: Amazon held 25% of the cross-border market, down from 26% in each of the preceding two years.
• 2025: Temu reached 24%, while eBay's share fell to 5%.
• September 2025: The described United States customs revision required tariffs and duties on Chinese shipments regardless of value.
• November 2025: Amazon expanded Bazaar to 14 additional markets.
• 2026: Customs changes continue to reshape shipping, while projections point to further growth for the largest platforms in Australia.

The sequence connects two forces shaping prices: companies are competing harder for customers while governments are changing the costs of moving small parcels across borders. Discounts that attracted shoppers must now operate within a more expensive import system.

Trust and repeat purchases tell a different story

Amazon retains a large advantage in consumer trust. An Omnisend survey found that nearly nine in 10 American consumers trust Amazon, while only 6% express the same level of trust in Temu.

Temu still attracted purchases from 48% of consumers in the past year. The reasons included prices, cited by 53%, ease of use, cited by 31%, and product markdowns, cited by 29%. A shopper can be attracted to a low price while feeling less confident about the marketplace delivering it.

Repeat purchasing also favors Amazon. Its repeat purchase rate is 56%, compared with Temu's 26%, a gap of 30 percentage points. Amazon's rate is more than twice Temu's, showing that winning an initial order and becoming a regular shopping destination are different tasks.

Prime membership supports that loyalty, with an annual renewal rate of 97%. Amazon's established name, customer service and reliable fulfillment give subscribers reasons to keep returning even when another platform offers cheaper products.

Temu's customer growth reaches beyond the audience often associated with newer shopping apps. Its fastest growing demographic includes people aged 55 to 64. By comparison, Shein's average shopper is a woman in her early 30s earning approximately $65,000 a year.

Shopping as entertainment or a quick task

Temu's app uses spinning wheels, mystery envelopes and multiplier card games that let shoppers win coupons and discounts. These features turn browsing into an activity with rewards, keeping people engaged for longer than a straightforward search and checkout might.

Shein uses a related approach through its loyalty program. Customers earn points for daily app check-ins, product reviews and purchases, then redeem those points for free products. Shopping becomes a repeated cycle of visits, rewards and orders.

Amazon's main design takes the opposite approach. Its "Buy Again" widget and "Buy Now" checkout aim to shorten the time between deciding to buy something and completing the purchase. The customer can return to a familiar item or order with a single click.

Those designs reflect different priorities. Amazon focuses on finishing a task quickly. Temu and Shein treat their platforms partly as entertainment destinations, where longer engagement can create more opportunities to sell. Price matters in both models, but the route to the purchase feels different.

Australia and the pressure on global delivery

In Australia, analysts project that Amazon, Temu and Shein will together capture more than one-third of the online retail market by 2026, generating over $18 billion in local sales. That concentration puts pressure on local digital marketplaces to grow or find specialized areas where they can compete.

Temu already ships to at least 70 countries. Its expanding reach gives manufacturers access to customers far beyond China, while placing more parcels into international transport networks.

The surge in cross-border shopping from China has strained logistics infrastructure. Postal workers in various countries have reported being overwhelmed by package volumes from these platforms, and increased demand for shipping capacity has pushed up air cargo rates.

Those transport pressures connect directly to the low price promise. A marketplace can reduce the number of intermediaries, but it still needs space on aircraft and delivery capacity after parcels arrive. Higher transport costs join tariffs and fees as expenses that platforms must absorb or pass to shoppers.

Traditional retailers face a different part of the same pressure. IKEA's 26% profit decline after price cuts illustrates the cost of defending affordability. eBay's loss of 68% of its cross-border business between 2018 and 2025 shows how established marketplaces can lose ground as buying habits change.

What shoppers expect before ordering abroad

The IPC survey found that 61% of consumers consider information about delivery charges essential before buying. For shoppers comparing cheap items, the amount paid at checkout can matter as much as the price displayed beside the product.

Delivery speed has become less critical for international purchases. One-fifth of respondents said their products arrived within 10 to 14 days, while another 19% reported transit times of four to five days. Those experiences help explain why longer waits can fit alongside strong demand for lower prices.

Amazon's response through Bazaar and Haul recognizes that demand. Temu's continued expansion shows the appeal of its price model, although customs changes and rising logistics costs may slow its growth. The competition now involves the full purchase: the product price, delivery charge, waiting time and confidence that the order will arrive as expected.

The timing and size of any further price increases are not specified. As 2026 begins, the immediate pressure is already visible: platforms built around inexpensive international parcels must adjust to trade rules that increase the cost of those shipments.

The Essentials

• Temu rose from less than 1% of cross-border e-commerce in 2022 to 24% in 2025, close to Amazon's reported 24% to 25% share.
• The IPC survey covered 30,970 people in 37 countries.
• Amazon expanded Bazaar to 14 additional markets in November 2025, with products below $10 and some costing $2.
• Temu's direct sourcing, managed fulfillment and supplier production practices support prices often two to three times lower than Amazon's, and sometimes 10 times lower.
• United States customs changes and the EU's 3 euro fee on qualifying small parcels are increasing pressure on the low cost shipping model.
• Amazon's repeat purchase rate is 56%, compared with Temu's 26%, while Prime's annual renewal rate is 97%.
• IKEA's profit fell 26% after price cuts, and eBay's cross-border share reached 5% in 2025.
• Shoppers are balancing price against trust and speed, with 61% calling advance information about delivery charges essential.