Temu and Shein Cut U.S. Advertising Spend in Response to Tariffs
Temu and Shein have recently made significant changes to their advertising strategies in the U.S. market. The decision to slash their advertising spend comes as a response to tariffs and the end of the de minimis tariff exception for orders under $800. These actions could potentially create new opportunities for American shops and brands.
Google Shopping Ads Reduction
According to data shared by Tinuiti, a marketing agency, Temu and Shein have both drastically reduced their investment in Google Shopping ads. Temu stopped spending on Google Shopping ads between April 9 and 12, 2025, while Shein followed suit by cutting its ads investment on April 15. This shift in advertising strategy coincides with their plans to increase prices starting April 25 in response to U.S. tariffs and the upcoming elimination of the de minimis exception for goods from China and Hong Kong.
Impact on U.S. Retailers
Temu and Shein’s market decisions have had a notable impact on U.S. retailers. Temu held a 17% share of the U.S. discount market in December 2022, as reported by Reuters. Additionally, Temu recently introduced its U.S. Seller Program, providing opportunities for direct-to-consumer brands and other sellers to list their products on the platform.
Potential Beneficiaries
With Temu and Shein reducing their advertising and adjusting prices, the question arises, “Who stands to benefit from these changes?” While the answer remains uncertain, three groups are likely to benefit: ad buyers, discount retailers, and ecommerce SMBs.
Ad Buyers
Some industry experts speculate that the reduced demand from Temu and Shein could lead to lower CPMs or CPCs for other businesses, potentially driving increased shopping traffic. However, Tinuiti’s research director, Mark Ballard, suggests that the overall impact may be minimal, as many advertisers continue to bid for Google Shopping impressions.
Discount Retailers
Discount retail chains may experience a temporary relief from competition with the exit of Temu and Shein. However, factors such as tariffs on Chinese-made products and competition from other major retailers like Amazon, Walmart, and Target could still pose challenges.
Ecommerce SMBs
Small and midsized ecommerce sellers in the low-cost market segment could benefit from the absence of Temu and Shein. Selling low-cost items not sourced from China could become more viable, and products priced slightly above the discount range could find a new market opportunity.