Shein and Temu Expand Into Toy Market Amid Counterfeit Concerns

Shein and Temu Expand Into Toy Market Amid Counterfeit Concerns

Fast-growing e-commerce platforms Temu and Shein are making significant moves into the toy market as Black Friday approaches, competing with established retailers like Amazon, Walmart, and Target. While both platforms attract cost-conscious shoppers, concerns over counterfeit products linger.

Growing Toy Sales on Shein and Temu

Shein: Originally known for affordable clothing, toys have become one of the platform’s fastest-growing categories. A Shein spokesperson highlighted double-digit year-over-year sales growth in toys.

Temu: The platform reports an increase in toy-related searches, signaling rising interest among shoppers.

Competition with Major Retailers

Despite Shein and Temu’s growth, Amazon, Walmart, and Target control nearly 70% of the U.S. toy market, according to analyst Linda Bolton Weiser of D.A. Davidson. However, data suggests the landscape may be shifting:

Market Share Growth: 13% of U.S. holiday shoppers plan to buy gifts on Temu this year, up from 9% in 2023 (Kantar).

Rising Spending: U.S. credit card transactions on Shein and Temu have increased compared to last year (Facteus).

Appeal to Budget-Conscious Shoppers

Shein and Temu are particularly popular among low-income consumers:

Demographic Focus: These platforms appeal to shoppers earning less than $50,000 annually, who have been hit hard by rising inflation.

European Trends: In Europe, younger shoppers (aged 18–34) are increasingly purchasing toys on Temu, Shein, and AliExpress, according to a Circana study.

Opportunities and Challenges

Opportunities for U.S. Brands: 

Companies like MGA Entertainment (maker of L.O.L. Surprise! dolls) are exploring the potential of selling on platforms like Temu and Shein to reach a broader audience. CEO Isaac Larian emphasized the need to target consumers at all income levels, not just those with average incomes.

Counterfeit Concerns: Both platforms face scrutiny over counterfeit and fake products, which could deter partnerships with major brands and lead to regulatory challenges.

Conclusion

Shein and Temu’s push into the toy market signals a shift in holiday shopping habits, especially among price-sensitive consumers. While major retailers dominate, these platforms are carving out a growing niche, raising both opportunities and concerns for the broader toy industry.