In 2023, the waters of overseas e-commerce were stirred by TikTok and others during the Black Friday shopping frenzy. Recently, on the “overseas Double 11” – Black Friday, Temu, SHEIN, and the high-profile entrant TikTok launched a challenge against the seemingly invincible Amazon, offering low prices as if engaged in charity work.
“Can you imagine? I got a discount on a pot I ordered on TikTok, and after the discount, it cost me just over $100. The same pot on Amazon is 15% more expensive,” says Zhang Ying, a resident of California, who was almost stunned by the low prices this Black Friday. Many of her colleagues also took advantage of the ByteDance’s promotions during Black Friday.
Overseas, major players are fiercely competing, with ByteDance entering the scene during Black Friday to seize market share. Temu started with rolling prices, and the platform SHEIN, after becoming more structured, began Black Friday at the end of October and early November, turning the usual one-day shopping frenzy into a month-long Black Friday shopping season.
“I would rather not make a penny and still offer a 20% discount to participate in the event,” says a SHEIN merchant. “Even though there is only a $2 profit per order, data is more important than profit during Black Friday.”
Following Temu and SHEIN, ByteDance, the parent company of TikTok, not only introduced a $20 new customer free quota but also provided subsidies in addition to discounts ranging from 20% to 30%. After Temu “grabbed” Amazon traffic with a $200 high-value coupon, ByteDance, knocking on the door with money, also made a high-profile entry.
“This year’s eBay target of $5.9 million, only half has been achieved by November, traffic has dropped, all went to TikTok,” says RAY, who operates on both traditional e-commerce platforms and TikTok. RAY points out that unlike the logic of accumulating products on Amazon and eBay, where TikTok’s products sold over a thousand units within five days of being listed, and the inventory was sold out in less than a week, causing a significant impact.
“This Black Friday, overseas e-commerce is watching China, and Chinese e-commerce is watching Temu,” says an insider close to both Pinduoduo and Temu. “Unlike last year’s lukewarm debut of Black Friday, Pinduoduo has put a lot of effort into this year’s Black Friday, and other platforms are benchmarking against Temu.”
However, behind the booming single-day businesses, rising GMV data, and the success in attracting traffic, Temu, SHEIN, and TikTok have “lost substance.”
According to Adobe Analytics data, on Black Friday (November 24, local time), online sales in the United States alone reached a record $9.8 billion (approximately RMB 70 billion), a year-on-year increase of 7.5%. It is also expected that on “Cyber Monday” after Black Friday, online sales will reach up to $12 billion.
Nevertheless, even amid the “Black Friday madness” overseas, it’s still a scenario of “Amazon eating meat, Temu and SHEIN having some soup.” The latecomer TikTok couldn’t even get a sip of the soup.
“Although the order volume doubled, the profit per order was squeezed to just $1. It’s really hard to make money,” says a SHEIN merchant with a bitter smile. “Considering the nearly 50% return rate for clothing, plus the risk of damage to goods, it’s likely that we’ll end up losing money.” Zhang Dong, a TikTok fully-managed merchant, adds, “Even though the views are high, the products just don’t sell. Anyway, they’re listed, so let’s sell them if we can.”
This Black Friday, despite filling her shopping cart on Temu and SHEIN, Zhang Ying hesitated for items over $30. “Amazon is a bit more expensive, but it can be delivered the next day, and the packaging and quality of the products are more guaranteed. On other platforms, many items are only ‘one-time’ use, and they are often delivered bundled in a bag,” she explains. In the end, Zhang Ying chose to “place an order on Amazon.”
The “order-eager” merchants and platforms, amid this Black Friday, are clearly facing challenges.
I “Black Friday is getting earlier.” Ali, who lives in Los Angeles, used to be accustomed to filling her shopping cart at midnight on Thursday, the day before Black Friday. However, this year, as early as the second half of October, she noticed that Temu and TikTok were flooded with Black Friday discount messages, and SHEIN joined in early November. Even Amazon started its pre-sale on November 17.
The early start of the Black Friday “celebration” made Ali feel like she was experiencing the “Double 11” in China. The “low prices” heavily promoted by major platforms also made her, like a mouse attracted to cheese, exhausted from constantly comparing prices on various platforms. “For the same Christmas decorations, Amazon charges $3, Temu only needs $1, and TikTok, with the additional new user coupon, can be even cheaper. Even today, you order for $1.4 on Temu, and tomorrow it might drop to $1,” she says.
In the end, Ali ordered many Christmas decorations on Temu, bought hats and shoes on SHEIN for the fall and winter, and stumbled upon “Armani alternative lip gloss” on TikTok, “It’s only $5, so cheap.” While taking advantage of Black Friday to lure consumers away from Amazon, Temu, SHEIN, and TikTok have clearly put in a lot of effort.
“Forced wealth without humanity” is undoubtedly the feeling Zhang Ying, located in California, had when she first visited the website on Black Friday.
“The products on Temu’s homepage are all priced below $3, and there are also $100 and $200 coupons. SHEIN has more and more brands, ZARA is offering a 40% discount, and I bought four sets of small skirts for only $30,” she says. Moreover, Zhang Ying led her colleagues to “harvest wool” on TikTok, “Buying ataub official store pots on TikTok, the original price is $150, with a max 30% discount, and free shipping, it only costs $112.5.”
“Colleagues who used to look down on TikTok have given up on Amazon and immediately downloaded TikTok,” Zhang Ying laughs, saying that the “money power” of Chinese platforms has made her friends, who were originally loyal Prime users of Amazon, exclaim, “TikTok is really good.”
While overseas consumers were “frantically shopping” on Black Friday, numerous merchants also participated in the battle to “snatch Amazon traffic.”
“This year, the performance of old e-commerce platforms such as Amazon and eBay has declined significantly. In the past, we could double our performance every year, but this year’s target of $5.9 million is not even half achieved by November,” says RAY, an eBay store owner. He noticed the growth in TikTok’s traffic and, in August, started a local store on TikTok called “leisdeal.” “The hot products from the past years are now hard to sell on Amazon, but they can still be sold on TikTok,” he says.
During Black Friday, RAY’s “leisdeal” page posted more than 10 shopping recommendation videos, which received thousands of likes and views. “Our page fans reached 200,000 during Black Friday, and the number of daily new followers is over 2,000. It’s crazy.” He said that the turnover in the TikTok store has exceeded $1.2 million, and there are still more than 20 days to the end of the month.
On the other hand, the traditional e-commerce platform eBay, which he has operated for nearly ten years, has gradually lost its appeal to him. “The commission rate is as high as 12%, and the competitive products have been flooded. In addition, customer complaints and returns are frequent. The platform is not as easy to operate as it used to be,” he says.
On the last Black Friday in 2022, TikTok had not yet officially entered the battlefield, and the limelight was still mainly on Amazon and eBay. However, this year, TikTok became the dark horse in the overseas e-commerce market, making full use of its advantages in traffic and user base, gaining a large number of users and transactions in a short period, and significantly impacting traditional e-commerce platforms.
However, despite the impressive order volume, the traditional e-commerce giants Amazon and eBay have not been defeated. According to Adobe Analytics data, on Black Friday, online sales in the United States alone reached $9.8 billion, a year-on-year increase of 7.5%, setting a new record. Although Temu, SHEIN, and TikTok have made significant gains, they still face challenges in terms of profitability and customer loyalty.
According to a merchant on the SHEIN platform, the profit margin per order during Black Friday was squeezed to just $1. This is attributed to the high discount rates, rising advertising costs, and increased return rates. Similarly, merchants on TikTok reported challenges in making profits, citing the low profit margins and the difficulty in selling certain products.
Additionally, despite the efforts to attract customers with discounts and promotions, some consumers remain loyal to established platforms like Amazon due to factors such as quick delivery, reliable packaging, and perceived product quality. This indicates that while new entrants like TikTok may disrupt the market and attract attention, building long-term customer trust and loyalty remains a significant challenge.
In conclusion, the “Battle of Black Friday” in 2023 showcased the intensifying competition in the overseas e-commerce landscape, with Chinese platforms like Temu, SHEIN, and TikTok making bold moves to challenge traditional giants like Amazon and eBay. The competition has driven early promotions, heavy discounts, and a month-long Black Friday shopping season. However, the success of these newcomers is not without challenges, as profitability and customer loyalty remain key concerns. The battle continues, and the evolving dynamics of the e-commerce market will be closely watched in the coming years.