Seoul, February 20th: Chinese online shopping platform Temu has come under fire for its aggressive marketing strategy to attract customers in South Korea, industry sources said on Tuesday.
The direct purchase app, run by Chinese company PDD Holdings, has emerged as one of the favorite shopping destinations for budget-conscious Korean consumers by handing out free gifts and credits that can be used as cash.
According to Yonhap News, this marketing strategy includes discounts of up to 90%, one-time free returns within 90 days of purchase, and benefits worth up to hundreds of thousands of won.
To earn credits and freebies, existing Temu subscribers must invite friends through the app's refer-a-friend program.
Both existing and new subscribers can participate in daily reward events, but you must invite at least 7 friends for the “first reward” (meaning credits) and You must invite up to 60 friends to receive the giveaway.
Temu entered South Korea last July to compete with larger Chinese rival AliExpress, which launched in South Korea in 2018.
Young Korean consumers in their 20s and 30s post unboxing photos and videos of products they purchase through the Temu app on social networks such as YouTube, increasing the number of clicks and subscribers and bringing in high profits.
According to mobile market research firm WiseUp, the number of subscribers to South Korea's Temu app has jumped more than 10 times from 520,000 in August last year to 5.7 million in January.
PDD's Temu and Alibaba's AliExpress are increasing their presence in South Korea with unbeatable low prices and unparalleled marketing, despite long delivery times and inconsistent product quality.
