Temu cuts billions of dollars in US advertising after Trump raises taxes

Temu's business prospects are being overshadowed by new policies from the Trump administration. Photo: Shutterstock .

Online shopping app Temu, owned by China-backed PDD Holdings, has suspended advertising spending on major US digital platforms such as Google and Meta, a move that comes amid the Trump administration’s tightening of tariffs on Chinese imports, the SCMP reported.

According to data from Google's Advertising Transparency Center, since April 12, Temu's daily advertising volume on Google has dropped sharply to just 14 ads. Previously, between April 6 and 9, this number fluctuated between 30,000 and 60,000 ads per day.

Mike Ryan, director of e-commerce analytics at online advertising company Smarter Ecommerce, confirmed on LinkedIn that Temu has “turned off all Google Shopping ads in the US” as of April 9. Google Shopping is one of five advertising channels for businesses in the Google ecosystem, along with Maps, Play Store, Search, and YouTube.

On Meta's platforms, including Facebook, Instagram and WhatsApp, Temu's ad count was down to four as of April 16. Meta did not provide previous figures for comparison, but the drop was stark.

Since its official launch in the US market in September 2022, Temu has become one of the most active advertisers. The platform's name became widely known after running expensive ads during the 2023 Super Bowl - the biggest sporting event in the US.

As a result, it quickly attracted the attention of consumers with its aggressive discount sales strategy, focusing mainly on goods made in China.

While Temu does not publicly disclose its advertising costs, industry analysts estimate that the platform's spending in the US is in the billions of dollars.

However, Temu’s business prospects are being overshadowed by the new policies of the Donald Trump administration. According to a statement from the White House, tariffs on Chinese goods could increase by as much as 245%. At the same time, the policy of tax exemption (de minimis) for packages under $800 will also be abolished for China from May 2.

Ryan points to a strong correlation between Temu’s ad spend and its app’s store ranking. While this isn’t uncommon in the industry, with Temu, “the correlation seemed immediate and very clear,” he says.

As of April 16, Temu has dropped to 83rd place on Apple's App Store in the US, a sharp drop from the top 5 position it maintained from March 30 to April 9.

Meanwhile, Temu’s direct competitor Shein continues to advertise on both Google and Meta. Shein is running more than 310 ads on Meta-owned platforms this week, along with many more on Google, according to data from the platforms themselves.

Source: https://znews.vn/temu-cat-quang-cao-tren-google-va-meta-sau-khi-trump-tang-thue-post1546362.html