Last night, shopping app Temu, which isn’t quite a year and a half old, released its second Super Bowl ad in as many years. It was hard to miss because the same ad appeared multiple times, especially after the game-winning touchdown. By most estimates, the three times the ad was shown mid-game alone would have cost a whopping $21 million.
Compared to ads in which Beyoncé announced a new album and Sir Patrick Stewart offered to skin Peppa Pig into a football, the content of Temu’s ad was relatively mundane. There were no A-list celebrities or beloved cultural touchstones; not a single heartstring was touched. Instead, a group of silent, off-brand Pixar characters had their wishes for 99-cent toupees and $6.99 jeans granted by a witch in an orange dress, who herself had obtained these powers by ordering the magical dress she wore in Temu for $9.99. . All this took place under a jingle that encouraged viewers to shop like a billionaire– that is, shopping constantly, for pleasure and entertainment, without a moment’s consideration for price tags. The ad had the milquetoast sheen characteristic of AI-generated media, although beyond aesthetics there is no indication that this is the case.
Most companies spending big money on Super Bowl advertising go to great lengths and spend big bucks to make ads that are arguably worth the most expensive real estate in American marketing – the kind of thing that people could actually do. as, or at least discuss, instead of just tolerating. Temu, which was launched by a company in China but is aimed at a largely American consumer base, took the opposite approach: an ad that wouldn’t have looked out of place for a block of Law and order reruns or a shocking reality show on HGTV, but one that aired over and over again to the biggest audiences money can buy. On his third appearance, one of the guests at my Super Bowl party was singing part of the jingle…ooh ooh, Temu– to himself, and the rest of us had realized that we had been pronouncing the app’s name wrong all along. (It is TEH-mooapparently, unlike TEE-moo.)
Temu, if you’re one of the uninitiated who the ad was aimed at, is part of a wave of fast-growing retailers with ties to China, including Shein and TikTok Shop, that have emerged in recent years. These retailers offer a wide selection of low-cost consumer goods and compete with each other with the ultimate goal of challenging Amazon’s dominance as the primary intermediary between Chinese manufacturers and the Americans who buy their products. The company’s advertising, which is just one part of a broader media campaign that a recent JP Morgan report estimated would cost the retailer $3 billion this year, worked exactly as expected, at least judging by my guests. Temu is literally spending a fortune trying to accelerate familiarization with American buyers.
From the start, Temu seemed to understand that one of the biggest obstacles she faces in her apparent quest to rise to the top of American shopping is simply getting her name out there. The United States is a mature consumer market: Amazon dominates online retailing, and Walmart and Target, which have long been Amazon’s main digital competitors, also have a grip on everyday in-person shopping in a large part of the country. At the lower end of the market, Dollar Tree and Dollar General operate tens of thousands of stores in North America, largely targeting customers in poorer or more rural areas. Americans aren’t exactly short of places to buy weird junk, and it wasn’t clear whether they really needed or wanted another one when Temu launched in September 2022. When the company released its first Super Bowl commercial a few months later, not that many people in the United States had heard of Temu or its parent company, PDD Holdings, which was until recently headquartered in Shanghai and which also operates the Chinese retail giant Pinduoduo.
Over the past few decades, Super Bowl ads — historically reserved for powerhouse consumer brands like Coca-Cola, Budweiser and Ford — have become a way for new companies flush with investor cash to signal their desired entry into the consciousness of traditional consumers. . As the millennium dawned, dot-com startups such as E-trade and Pets.com bought up all the Super Bowl ad inventory they could get. More recently, ads for cryptocurrency exchanges have tapped stars like Matt Damon and Larry David to introduce the concept to the not-so-terminal online world. While most Americans have no idea who you are, what you’re selling, or why they should buy it, clever advertising at a notoriously expensive time not only puts your business in front of a wide audience; it also suggests that your business belongs alongside those that have been around so long that they have become part of the landscape of American life.
Temu’s ties to China make these associations even more valuable to its future. A majority of Americans have long said they prefer to buy products made domestically, and a significant number of consumers say they are specifically opposed to products made in China. But these preferences start to wane when products made abroad are cheaper. In practice, almost all Americans now regularly purchase consumer goods made elsewhere. Amazon has contributed greatly to this reality: slowly but surely, the retailer’s broad offering of products from third-party international sellers, chaotic user interface, and large number of listings created by non-native English speakers seem to be acclimating millions of people. to the types of transactions that would have seemed intolerably risky a decade ago. Buy directly Since a foreign retailer is a move Temu is clearly betting many of those same shoppers can now be persuaded to take, given the right circumstances. One of the first hurdles is making sure everyone knows your name.
History tells us that we should be skeptical of companies that attempt to use expensive advertising campaigns to muscle their way into these associations. The dot-com boom busted spectacularly and the crypto market collapsed with revelations of scams shortly after spending big money on TV ads. The fact that Temu is back for a second year is remarkable, as is the choice to seek familiarity rather than glitzy or lively celebrity associations. The lack of fussy megawatt stars, expensive licensing of famous songs or people, and soccer-specific themes mean the ad will be easy to rerun over and over in all kinds of broadcasts, teaching millions of Americans additional how to pronounce the name of the application via a simple jingle. The lesson was already spreading before the Super Bowl: Temu ran “Shop Like a Billionaire” ads on other shows all year. (This is perhaps an explanation for Temu’s counterintuitive popularity among older people, whose purchasing habits are seen as more difficult to change than those of younger consumers who are comfortable making their purchases. purchases on the Internet; older people also watch a lot more television.)
This approach is exactly in line with a number of other marketing moves Temu has made over the past year, which has seen the retailer invest millions of dollars to get its products featured in search listings and ad placements in line. Combined with its efforts on television and elsewhere, these campaigns cost about $1.7 billion. According to a recent article in The Wall Street Journal, these huge expenses – along with a smaller campaign from Shein – were enough to drive up the cost of internet advertising. This in turn has strengthened the fortunes of Google and Meta, which control the bulk of online advertising. It has also started to eat into the bottom line of some of Temu’s competitors, who now have to pay higher prices for advertising, while Temu undercuts the prices of its products.
Last year, Temu had an estimated $16 billion in revenue, accounting for about more than three-quarters of Target’s online revenue in 2022. Most industry observers attribute this unprecedented growth to a combination of ubiquity and price: The company spends a ton to get in front of as many people as quickly as possible, and it sells many of its products at prices so low they seem mathematically impossible. Temu was accused of selling products made using forced labor in order to achieve these prices. It is also widely believed that the company is temporarily selling products at a loss in an attempt to buy market share from competitors. (Temu has denied the accusations regarding his working conditions. In a statement to WSJA Temu spokesperson also denied that the company was losing money in a bid to quickly gain ground on competitors.) Amazon has also slashed prices for years in an effort to convert online shopping skeptics, although he denied that pushing for lower prices is predatory.
Advertising is both more and less powerful than commonly believed. It’s almost never enough, on its own, to turn a product or service into a phenomenon from scratch; if that were the case, consumer history would not be riddled with so many famous failures once lifted to the top by luxurious marketing budgets. But in the globalized consumer system, advertising, whatever it may be, is generally East a necessary pretext for any success you try to achieve. Otherwise, it’s rare that many people will discover that your business exists. Temu’s long-term success will depend on more than publicity, but if he fails, it won’t be because no one knew his name.