Landed quietly in Canada this winter, the online shopping and discount site Temu is already worried. The company, headquartered in the United States, is owned by a Chinese company suspected of using malware to track its Chinese customers. An expensive price to pay for Internet users interested in paying cheap…
Temu was first launched in the United States in the fall of 2022. It launched in Canada last February, on the heels of a major American campaign which included the purchase of expensive television commercials during the Super Bowl of the National Football League (NFL).
Temu is an online sales site that is positioned halfway between a group purchase site and a liquidation site. It sells everything from electronics and clothing to home and pet accessories. Above all, it is its prices that attract buyers. There are bedside lamps for $2, Bluetooth headphones for $15 and very chic clothes for less than $10…
time and money
Temu’s model is simple: it sells products obtained directly from Chinese manufacturers. The site cuts off an intermediary, the North American merchant who also gets his supplies from China, but who must pay for the import and storage costs of his products.
Temu also ships its customers’ purchases directly from China. This creates longer delivery times than a local site. In the United States, a high number of online shoppers have complained that their purchases more often than not arrive late, damaged or never at all.
“We call this phenomenon ‘disintermediation’,” says HEC Montréal marketing professor Renaud Legoux. “We believe that we can eliminate an intermediary and offer all the services to sell a product without going through a distributor. This is the logical continuation of what we have seen with Amazon and eBay in recent years, then more recently in the parachuting of products on social networks, says the Montreal professor.
For the consumer, it’s a double-edged sword, continues Mr. Legoux. “The offer makes sense if the buyer is willing to accept much longer delivery times. »
This is above all another indirect attack on the legal framework that has been developed over time around consumer protection. When a new player decides to bypass the existing business model, it raises fundamental questions, continues Renaud Legoux.
“With each new disruptive technology, we see that consumer protection is not a top priority. This is a question of safety for the end consumer, and that is often forgotten. »
National security?
In the United States, Temu additionally raises national security issues. Members of the US Congress would like to see Temu blocked until the light is shed on how it collects data on its users. Especially since the latter are more and more numerous: Temu currently appears as the most downloaded mobile application from the Apple App Store in both Canada and the United States.
The eponymous company that owns Temu says it is headquartered in Boston. Temu is actually owned by Chinese giant PDD Holdings, which also owns an e-commerce site exclusive to the Chinese market called Pinduoduo.
However, it was recently discovered by the American news channel CNN that Pinduoduo was spying on its users. Once installed, the Pinduoduo application would embed itself in the operating system to thwart its security beacons and harvest private data. Among other things, it would spy on how its users browse the Internet and how they use other applications on their phones.
Worse still, it would appear that the app, once downloaded to a mobile phone, would be next to impossible to uninstall.
In the United States, where Chinese technologies are increasingly feared, there are fears that this data might then be passed on to the Chinese government. It’s the same fear as for TikTok. Elected officials wonder if the Temu application does not have, like Pinduoduo, this option to recover data without the knowledge of its users, which might then also be transmitted to the Chinese authorities.
Currently, there is nothing to say that Temu spies on its users like Pinduoduo does. But the situation once more illustrates the growing distrust of Western countries towards Chinese technologies.