News & Insights

Online retail giants Temu and Shein are focusing on the European marketplace while TikTok could be the future of e-commerce, delegates at the World Retail Congress heard in Berlin on Tuesday during a discussion on what global retailers can learn from Chinese marketplaces.

Xavier Xu, VP International at Deli Group, said Shein was putting “a lot of resources into Europe” during a panel on China’s New Global Commerce Playbook. Xu said fashion is “fast changing” and that it’s difficult for sellers to place inventory in the US. Shein’s business model is weakened there, he added.

“A lot of the mid-size sellers, small sellers are shifting focus from US to Europe,” Xu said. He shared that Temu and Shein heavily invest in Europe “by recruiting a lot of local brands, local designers and local sellers”. He said this approach helps with tariffs, while locally-sourced items are often better quality.

“In all, 70-80% of what is sent to Europeans is locally sourced,” added Jordan Berke, Founder and CEO for digital retail advisory firm Tomorrow. “That’s a very different experience to the Shein we grew up with.”

Social media platform TikTok is also changing the global marketplace. The app is an “entirely different animal,” said Xu. “We think of it more like the future of e-commerce. It’s not only about the item and the price, it’s also about the content and customer’s desires.”

“The company is only 10-years-old and is like $700 billion - that’s like a miracle,” he added.

Content factories are also an integral part of growing the business.

“The content is the most important part. We have content factories to film a lot of the short clips. And we use a lot of AI right now, 30% of the clips are filmed using AI. This continues content creation and allows us to get a lot of good traffic on the platform.”