Temu slashes U.S. ad spending, plummets in App Store rankings after Trump China tariffs
In just 17 days after launch, Temu surpassed Instagram, WhatsApp, Snapchat and Shein on the Apple App Store in the U.S., according to Apptopia data shared with CNBC.
Stefani Reynolds | Afp | Getty Images
Chinese online retailer Temu, whose “Shop like a billionaire” marketing campaign made its way to last year’s Super Bowl, has dramatically slashed its online ad spending in the U.S. and seen its ranking in Apple’s App Store plunge following President Donald Trump’s sweeping tariffs on trade partners.
Temu, which is owned by Chinese e-commerce giant PDD Holdings, had been on an online advertising blitz in recent years in a bid to attract deal-hungry American shoppers to its site. With hefty spending on TV ads as well across Facebook, the company promoted clothing, jewelry, home goods and electronics at bargain basement prices.
The strategy was so effective that Temu topped Apple’s list of the most downloaded free apps in the U.S. for the past two years. Downloads of Temu on Apple’s App Store have fallen 62% in recent days, according to data from SimilarWeb, a digital data and analytics company. Ads for 50-cent eyebrow trimmers and $5 t-shirts that used to blanket Google search results and Facebook feeds have all but disappeared.
President Trump’s tariffs have upended Temu’s business model, along with its advertising strategy. Packages shipped from China are now subject to a tariff rate of 145%, while the de minimis provision, which allows shipments worth less than $800 to enter the country duty-free, is set to go away on May 2.
Temu and Shein, a fast-fashion marketplace with ties to China, plan to raise their prices in response to the tariffs. Both companies posted notices to their websites in recent days that warned they’ll be raising prices late next week.
“Due to recent changes in global trade rules and tariffs, our operating expenses have gone up,” Temu said on its site. “To keep offering the products you love without compromising on quality, we will be making price adjustments starting April 25, 2025.”
Sellers on Amazon’s third-party marketplace, many of whom source their products from China, have said they’re considering raising prices as they reckon with higher costs from the tariffs. Many businesses on TikTok Shop, the social media app’s marketplace, also count on Chinese manufacturers for their items.
Amazon launched a competitor to Temu last November, called Amazon Haul, which features items under $20 that are largely from China.
The Temu app is now No. 69 in a list of the top free apps in the U.S., after consistently ranking in the top 10, according to data from Sensor Tower. Shein is currently at 42, down from 15 last month. PDD’s shares that trade in the U.S. have plummeted 22% this month, compared to the Nasdaq’s 6% drop. Shein is privately held.
Rival Chinese retailers have subsequently risen to the top of the app store ranks, including Beijing-based wholesaler DHgate, which surged to the No. 2 top free iPhone app in the U.S., and Alibaba‘s Taobao, which ranked No. 7. Bloomberg reported on Tuesday that viral videos promoting their cheap products have spurred the download frenzy.
A separate analysis by SimilarWeb showed Temu’s paid traffic, or search, display and social media advertising that drove visits to its website, has dropped 77% since April 11. Temu’s paid traffic previously outpaced nonpaid traffic to its website by 2 1/2 times, Ben Parkes, a consumer goods and retail analyst at Similarweb, said in an interview.
Marketing firm Tinuiti found that 20% of U.S. Google Shopping ad impressions were bought by Temu on April 5. A week later, that number had fallen to zero. By comparison, Shein’s impressions remained at 17% on April 12, while 60% of impressions were bought by Amazon.
Representatives from Temu and Shein didn’t immediately respond to requests for comment.
Temu was previously one of Meta’s largest advertisers, but it appears to have dramatically scaled back its spending on the platform. As of Wednesday, Temu is running six ads across Meta platforms in the U.S., a review of Meta’s ad library shows. Temu is running approximately 27,000 ads across Meta sites and apps globally, particularly in Europe and the U.K.
That could be troublesome for Meta’s advertising business, which has gotten a significant boost from the discount retailer. Advertising analyst Brian Wieser at Madison and Wall estimated that more than $7 billion of Meta’s $132 billion in ad revenue in 2023 came from China. Meta is scheduled to report first-quarter results on April 30.
E-commerce analyst Juozas Kaziukenas said he expects Temu to turn its ads back on in the U.S. at some point, but that the company appears to be shifting its dollars to other markets in the interim.
“It doesn’t mean Temu usage has dropped as significantly as the app did,” Kaziukenas said in an email. “But it means that new user acquisition is gone.”
WATCH: Amazon CEO Andy Jassy says sellers will pass cost of tariffs on to consumers
Salesforce CEO Marc Benioff speaks at the Dreamforce conference in San Francisco on Sept. 17, 2024.
David Paul Morris | Bloomberg | Getty Images
Salesforce is adding voice to its Agentforce software, letting clients go beyond text when using artificial intelligence agents to respond to customer questions.
With Agentforce Voice, companies can customize the tone and speed of voices and adjust the pronunciation of specific terms, Salesforce said Monday, ahead of its Dreamforce conference in San Francisco this week. The feature also allows people to interrupt the AI agent during phone calls.
Voice is becoming a bigger part of the generative AI boom, which started with text-based prompts in late 2022, when OpenAI launched ChatGPT. In the past year, OpenAI and Anthropic have enabled their chatbots to conduct spoken conversations without sounding overly robotic. Now that capability is taking hold inside business software.
Agentforce Voice will integrate with corporate phone systems from Amazon, Five9, Genesys, Nice and Ericsson’s Vonage.
Former Salesforce co-CEO Bret Taylor is also trying his hand in the market. Taylor helped start Sierra in 2023, and last year the startup announced that its AI agents “can now pick up the phone.” Sierra has been valued at $10 billion, and has a client list that includes ADT, SiriusXM and SoFi.
Salesforce has been under pressure this year in part due to investor concern that software companies could lose business as AI moves deeper into coding. The stock is down about 28% so far in 2025, while the Nasdaq has gained around 15% over that stretch.
Anthropic told reporters in September that its Claude Sonnet 4.5 model built a chat app similar to Salesforce’s Slack in 30 hours. In Salesforce’s latest earnings report, the company warned that new AI products “may disrupt workforce needs and negatively impact demand for our offerings.”
Salesforce CEO Marc Benioff has downplayed the risk to this company.
“When we get into this kind of zero-sum game, well, all this is going to get wiped out, or all this is going to change, then, you know, you’re not dealing with somebody who actually runs a company, because that’s not the way business works,” Benioff told CNBC’s Morgan Brennan last month. “Business is incremental, it’s evolutionary, it’s growing, it’s evolving, and we don’t see that kind of change.”
Salesforce launched Agentforce last year as a service that could respond to customer requests over text chats with help from generative AI models. Agentforce now has more than 12,000 implementations, according to a statement. But there’s some skepticism about its popularity.
“Investor enthusiasm around Agentforce has moderated as adoption has lagged expectations,” RBC Capital Markets analysts, who recommend holding the stock, wrote in a note to clients last week.
In November, Salesforce will provide early access to Agent Script software, which organizations can use to customize what agents say and do.
WATCH: Salesforce CEO Marc Benioff on what the market is getting wrong about AI
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