Shein, Temu boost ad spending in Europe as Trump tariffs squash largest market

Shein and Temu are spending more on advertising in Europe – and sharply pulling back in the US – as President Trump’s tariffs effectively block the Chinese fast-fashion firms from their biggest market, according to a report.

The race to ramp up spending last month in Europe was most significant in France and the UK, where Shein boosted its dollars 35%, and Temu raised its spending by 40% and 20%, respectively, from the month before, according to Sensor Tower data reported by Reuters.

Meanwhile, Shein’s daily average spending on US platforms like Facebook and Instagram plunged about 19% from March 31 to April 13 compared to the month before, and Temu’s plummeted 31%, according to the data. 

Shein and Temu ramped up spending in April in Europe ahead of President Trump’s tariffs, according to a report. REUTERS

That strategy change came as the firms rushed to prepare for last Friday, when Trump ended the de minimis exemption, a trade loophole that Shein and Temu used to ship packages worth less than $800 into the duty-free. 

The exemption allowed Shein and Temu to sell goods at ultra-low prices to US customers, like $5 shirts and $10 dresses, and skip the customs process for speedy deliveries.

Trump’s tariffs threaten Shein and Temu’s edge in selling cheap products. A $10 dress, for example, would jump to $24.50 with the full weight of the 145% tariff on China – making it much less of a deal for American customers.

Temu has already stopped shipments from China to the US, promoting only “local” products on its US website. 

Items with the “local” badge come from US warehouses with inventory that was shipped over ahead of the taxes. But these stockpiles will eventually start to dwindle.

The Chinese fast-fashion firms slashed their digital advertising spending in the US, according to Sensor Tower. REUTERS

As they attempt to pivot to new markets, Shein and Temu have massively hiked their ad spending in Europe compared to last year – up 45% in France and 100% in the UK for Shein, and 115% in France and 20% in the UK for Temu, according to the data.

That advertising push has already helped Shein and Temu secure more app downloads in the UK. Shein saw a 25% increase in downloads from the month before, while downloads of Temu more than doubled, according to Sensor Tower.

However, these new downloads have only brought in marginal increases in daily active users.

The firms “probably won’t be able to gain as many customers” as they had in the United States, said Kimber Maderazzo, marketing professor at Pepperdine Graziadio Business School.

With Post wires