Chinese tech giants’ push into U.S., Europe’s markets sets up potential clash with Amazon

TikTok owner ByteDance has launched a women’s fashion website called If Yooou. Pinduoduo launched an e-commerce site in the US called Temu. The two companies are the latest Chinese tech giants to crack the international e-commerce market dominated by Amazon.

Mike Kemp | In pictures | Getty Images

Pindudo And TikTok owner ByteDance has launched e-commerce websites overseas in recent months, as it aims to keep foreign buyers from selling Chinese products.

The move puts the two Chinese tech companies on a collision course Amazon As they expand internationally.

Pinduoduo, one of China’s largest e-commerce companies, Launched a US shopping site called Teemu Last month, which sold products in categories ranging from fashion to sports and electronics.

Weeks later, ByteDance, the Beijing-headquartered owner of the tiny video app TikTok, launched a fashion website called If Yooou. It is currently shipping in the UK, Spain, Italy, Germany and France.

Both companies are looking to replicate the success of Chinese fast fashion brand Sheen Now worth $100 billion and has gained a large customer base in the US and elsewhere.

ByteDance and Pinduoduo also rely on cross-border e-commerce – selling Chinese goods to foreign customers. The US and European markets also offer growth opportunities.

The push abroad comes as tech giants in China look for new avenues of growth as the domestic economy grows. Continues to face challenges As a result of Beijing’s strict Covid control policies and deteriorating global economic environment.

“I think ByteDance and [Pinduoduo] are seizing the opportunity to apply their unique social commerce innovation to foreign markets, Jacob Cook, CEO of WPIC, an e-commerce tech and marketing firm that helps foreign brands sell in China, told CNBC.

Pinduoduo declined to comment for this story, while ByteDance did not respond to a request for comment.

Pinduoduo and ByteDance e-commerce strategy

The cross-border e-commerce strategies of Pinduoduo, also known as PDD, and ByteDance will differ depending on their respective strengths.

In China, PDD has grown rapidly by building direct relationships with suppliers and offering deep discounts. It can help when it comes to sourcing products for sale in the US and selling them at lower prices.

ByteDance, meanwhile, runs TikTok — one of the world’s most popular social media apps.

ByteDance’s algorithm for understanding consumers on Tiktok, “as well as the ability to leverage the TikTok ecosystem for commerce, are huge advantages,” Cook said.

The Chinese firm is not new to e-commerce overseas. In the UK, TikTok has a shopping feature where brands and influencers make videos about products and users can buy those products through the app.

But still no success.

[Pinduoduo and ByteDance] Cope with low brand recognition and need to build user trust.

Dmonstudio, a women’s fashion site previously launched by Bytedance, shut down after a few months of operation. And ByteDance’s other e-commerce site, Fanno, hasn’t gotten much traction.

So-called livestream shopping is very popular in China and some countries in Asia, but hasn’t really taken off in Europe or the US. Financial Times It was reported in July that TikTok had dropped plans to expand its livestream e-commerce strategy to Europe and the US

This may be because ByteDance has maintained an e-commerce shopping website along with the TikTok shopping strategy.

New Chinese companies ByteDance and Pinduodudo are looking to enter the international market. Ali Baba And JD.comare China’s two largest e-commerce companies Expanding overseas over the past few years.

The Amazon challenge?

Read more about China from CNBC Pro

According to Cook, that’s one reason why consumer behavior outside of China favors Amazon’s model. Customers typically go to Amazon to find specific products or brands they’ve already decided to buy, he said.

In contrast, Chinese platforms like Alibaba’s Tmall and JD.com “function like virtual shopping malls where people browse and participate in a digital social experience.”

Pinduoduo and ByteDance “could eat into Amazon’s share in some areas like Sheen did, but ultimately they won’t threaten Amazon’s stranglehold on the U.S. e-commerce market,” Cook said.

“They face low brand recognition and need to build user trust.”

How China's Sheen Became More Valuable Than H&M and Zara Combined

Source link

Leave a Comment