Author | Huang Yu Editor | Liu Baodan Last year, thanks to the success of the "Speeding" on iQiyi, the company has had a difficult time recently. On the one hand, the explosively popular TV series is on hiatus, and on the other hand, the derivative concert of the variety show "Plant Some Goodness" has been criticized for "free offline but paid online." According to Wall Street News, the second Wheat Field Music Festival, produced by iQiyi's reality show "Plant Some Goodness," was held on June 6th. Some viewers had previously received free offline tickets through official activities, while online viewers, even iQiyi members, had to pay RMB 12 for viewing, and the viewing period was valid until June 14th. This differentiated pricing model has caused dissatisfaction among many viewers, who question that iQiyi's move is "cutting corners." In response, iQiyi's customer service said, "You can buy tickets to watch the concert live according to your own needs, and the edited content of the concert will be launched on the main platform in the future." In fact, this is not the first time that long video platforms represented by iQiyi have been accused of "cutting corners." In recent years, membership grading systems, early access, and inventory restrictions have often caused user backlash, in addition to paying extra for derivative programs. The differential pricing model reflects the growth anxiety faced by long-form video platforms such as "i优腾."

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TEMU, which is striving to break through Southeast Asia, quickly rushed into Vietnam and set its sights on this hot land for Chinese companies going abroad.

Recently, as a cross-border e-commerce platform under pdd holdings, TEMU has quietly launched sites in Vietnam and Brunei. With this, TEMU's market coverage in Southeast Asia has increased to 5.

TEMU's Southeast Asian journey started in August last year when it entered the Philippines. In September of the same year, it opened the Malaysia site, and by July of this year, it entered Thailand. In other words, apart from Singapore and Indonesia, TEMU now covers most of the mainstream e-commerce markets in Southeast Asia.

It is reported that, consistent with other sites, TEMU also offers shopping benefits in the Vietnamese market, such as free shipping and discounts of up to 90%.

Currently, the initial version of TEMU in Vietnam is basic, only supports English, accepts credit card payments only, and only two logistics companies (Ninja Van and Best Express) are connected.

However, due to its geographical advantage bordering China, the delivery time in Vietnam for TEMU has been shortened to 4 to 7 days, compared to 5 to 20 days needed for delivery to Malaysia and the Philippines, showing a significant improvement in speed.

For TEMU, which is expanding into the Southeast Asian market, Vietnam is an important market that cannot be ignored, especially given the situation where its entry into Indonesia, the largest e-commerce market in Southeast Asia, is blocked. The Minister of Communication and Information of Indonesia recently reiterated that Indonesia will continue to prohibit the e-commerce platform TEMU from entering the domestic market, out of concern that the platform may impact local small and medium-sized enterprises.

Vietnam is currently the fastest-growing e-commerce market in Southeast Asia.

According to the recent 'Southeast Asia E-commerce Report' released by OpenGov Asia, Vietnam and Thailand have become the two fastest-growing e-commerce markets in the Southeast Asian region. In particular, Vietnam's growth is particularly significant, with the e-commerce platform's Gross Merchandise Volume (GMV) increasing by 52.9% year-on-year in 2023.

Over the past four years, the annual growth rate of Vietnam's e-commerce market has been between 16% and 30%, ranking first globally.

Moreover, Vietnam has surpassed the Philippines to become the third-largest e-commerce market in Southeast Asia.

The Vietnamese government highly regards the development of e-commerce, introducing a series of policy measures to promote the rapid growth of e-commerce.

For example, the Vietnamese government has streamlined the registration process for e-commerce companies, provided tax incentives, and increased investment in logistics and payment systems; the Vietnamese e-commerce and digital economy department is strengthening the legal framework, providing financial support, vigorously attracting investment, and striving to ensure data and cybersecurity.

According to the report from OpenGov Asia, Vietnam is supporting the development of cross-border e-commerce through various policies and innovative solutions, making it a key economic growth driver. Between 2022-2025, the expansion rate in this sector is 2.3 times that of traditional e-commerce.

Facing such a new high-growth market, TEMU is not short of competition upon entry. Just like the entire Southeast Asian market, Shopee and Lazada have become undisputed leaders in Vietnam, with TikTok Shop also making a strong entry.

Also starting its cross-border e-commerce business in 2022, TikTok chose a different international expansion route from TEMU. TikTok first launched TikTok Shop in Southeast Asia, and it wasn't until September 12th last year that TikTok Shop officially launched in the USA.

While TEMU chose to enter 'mature developed markets' first before expanding to 'emerging markets,' thus losing its first-mover advantage in Southeast Asia.

Some believe that for TEMU, its low-price advantage may be difficult to highlight in low-consumption countries in Southeast Asia; to establish a strong presence in this region may further compress profit margins.

However, senior cross-border e-commerce expert Lin Zhiyong told Wall Street that Southeast Asian consumers prefer low prices, are in the 'post-Taobao era,' and pdd holdings' low-price advantage is evident, making it easier to replicate the success story in China in Southeast Asia.

With the plateauing of China's e-commerce industry increment, TEMU is pdd holdings' breakthrough in seeking new growth points. Relying on a low-price strategy and an innovative 'full-service model,' in September 2022, TEMU, like a catfish, surged into the blue ocean of cross-border e-commerce, rapidly expanding to 48 countries and regions worldwide by 2023.

Since the beginning of this year, TEMU has been operating at full capacity, entering more countries and regions. According to Wall Street Journal statistics, as of October 9, TEMU has been operating in 82 countries and regions globally.

Under the promotion of TEMU, pdd holdings achieved a significant increase in total revenue last year, with annual revenue of 247.6 billion yuan, a year-on-year growth of 90%; operating profit was 58.699 billion yuan, a year-on-year increase of 93.08%.

In the first quarter of this year, PDD Holdings' revenue increased by 131% year-on-year to 86.81 billion yuan, of which the transaction service revenue, mainly driven by TEMU, increased significantly by 327% year-on-year to 44.36 billion US dollars, becoming PDD Holdings' largest source of revenue for the first time, surpassing online marketing business.

However, in the second quarter, pdd holdings' growth slowed down, with revenue growing by 86% year-on-year to 97.06 billion yuan, and revenue from trading services was 47.944 billion yuan, a 234% year-on-year increase.

The management of pdd holdings also intentionally dampened market expectations. At the performance briefing in August, the Chairman of pdd holdings, Co-CEO Chen Lei, stated that pdd holdings' global business is still in the early exploration stage and may face many changes and challenges in the future, with non-commercial challenges becoming increasingly severe.

It can be seen that as the scale rapidly expands, TEMU faces increasing policy risks overseas.

In addition to Indonesia mentioned earlier, shortly after entering the Thai market at the end of July, TEMU was put under restrictions. Thai Prime Minister Prayut Chan-o-cha personally ordered the Ministry of Digital Economy and Society, the Revenue Department, and the police to investigate whether TEMU complies with Thai laws and pays the required taxes.

Prayut Chan-o-cha said that the arrival of foreign e-commerce platforms has brought problems to Thailand's retail industry because they have strong funds and are equipped with new technologies, making it difficult for Thai companies to compete. He also warns that any Thai officials who help these foreign platforms evade taxes will be severely punished.

As an important market for TEMU layout, Europe and the United States also tightened their policies this year. In April and May, SHEIN and TEMU were successively designated as "super large online platforms", becoming key regulatory targets of the EU's Digital Services Act; In July, the EU will propose to abolish the current tax-free threshold for goods worth less than 150 euros (approximately 161 US dollars) from non-EU countries.

After two years of rapid growth, TEMU aims to become one of the winners in the global cross-border e-commerce industry, a long and arduous task.