Australian brands face increasing pressure from ultra-cheap Temu and Shein. More than 2 million Australians shop on these platforms each month
The cost-of-living crisis in Australia coupled with the normalisation of online shopping has created a perfect storm for the stunning rise of a new breed of ultra cheap online retailers, who now maintain significant market share in Australian retail according to Roy Morgan.
Temu and Shein create a new mass market for ultra-cheap throw away retail
The sharp and sudden rise of ultra cheap Chinese owned online-only platforms Temu and Shein has surprised many. Shein now has close to 800,000 shoppers each month in Australia for clothing and accessories, putting it on track to reach a billion dollars in annual sales, which is set to grow now that Shein has expanded into categories beyond apparel.
Meanwhile, thanks to a mix of ultra-cheap prices, free delivery and aggressive marketing and media spend Temu has in just one year built a stunningly large customer base in Australia, with 1.26 million Australians shopping each month, putting it on track to clock $1.3 billion in annual sales.
Estimated number of shoppers each month Shopped at least once in the month, may have shopped multiple times.
Base: Australians 14+, Shein n=32,669 (July-Dec 2023), Temu n=16,364 (Oct-Dec 2023).
Estimated total annual sales
Annualised estimate based on monthly sales.
Source: Roy Morgan Single Source (Australia)
Base: Australians 14+, Shein n=32,669 (July-Dec 2023), Temu n=16,364 (Oct-Dec 2023).
Who’s shopping on Shein and Temu?
A mix of ultra-cheap prices and convenience has proved to be a winning formula among young parents and larger households, with these cohorts over-represented among Temu and Shein shoppers.
Interestingly, retired Australians - who ramped up their app usage over COVID - are also over-represented among Temu shoppers, embracing the platform’s ultra-low prices to help their limited dollars stretch further.
Looking at gender, 3 in 10 Temu shoppers are men, while the majority of Shein’s shoppers (80%) are women.
Budget conscious bargain seekers are not the only people shopping on Temu & Shein – posing a real threat to brands
It’s not only discount stores facing pressure from these platforms. The home of brands - Australian department stores – are also under threat as their shoppers redirect part of their spending to Temu and Shein to get more for their money in a tight economic environment. David Jones shoppers are almost twice as likely as the average Australian to shop at Temu, while Myer shoppers are 67% more likely.
Looking at Shein, David Jones shoppers are almost three times more likely as the average Australian to shop on the platform, while Myer shoppers are twice as likely.
Michele Levine, Chief Executive Officer, Roy Morgan:
“The only way to truly understand the scope of internet only retail businesses, like Shein and Temu, is through interviewing tens of thousands of Australians. Roy Morgan interviews a representative cross-section of over 65,000 Australians each year to obtain a fully rounded understanding of the lifestyles, attitudes, media consumption habits and other key factors that drive purchasing decisions.
“Shein and Temu have surprised everyone, few could have predicted that a mass market for ultra cheap throw-away retail existed in Australia. Certainly, cost of living pressures have fueled both Shein and Temu’s stunning rise as Australians look to get more for their dollars.
“But it remains to be seen whether Temu will really stick – the current numbers indicate that a lot of people are trialing the platform, so we’ll see if that holds over 2024 as customers assess the quality of products that arrive at their door.
“And of course, the longevity of these platforms is unknown, especially Temu, as we wait to see how its aggressive loss-making customer acquisition strategy – driven by huge digital search spend and free-delivery – unfolds.”
To learn more about Roy Morgan’s online and shopping data, call (+61) (3) 9224 5309 or email askroymorgan@roymorgan.com. Please click on this link to the Roy Morgan Online Store.
About Roy Morgan
Roy Morgan is Australia’s largest independent Australian research company, with offices in each state, as well as in the U.S. and U.K. A full-service research organisation, Roy Morgan has over 80 years’ experience collecting objective, independent information on consumers.
Margin of Error
The margin of error to be allowed for in any estimate depends mainly on the number of interviews on which it is based. Margin of error gives indications of the likely range within which estimates would be 95% likely to fall, expressed as the number of percentage points above or below the actual estimate. Allowance for design effects (such as stratification and weighting) should be made as appropriate.
| Sample Size | Percentage Estimate |
| 40% – 60% | 25% or 75% | 10% or 90% | 5% or 95% | |
| 1,000 | ±3.0 | ±2.7 | ±1.9 | ±1.3 |
| 5,000 | ±1.4 | ±1.2 | ±0.8 | ±0.6 |
| 7,500 | ±1.1 | ±1.0 | ±0.7 | ±0.5 |
| 10,000 | ±1.0 | ±0.9 | ±0.6 | ±0.4 |
| 20,000 | ±0.7 | ±0.6 | ±0.4 | ±0.3 |
| 50,000 | ±0.4 | ±0.4 | ±0.3 | ±0.2 |
