Chinese Retail Titans Temu and Shein Slash U.S. Digital Ad Spend

Temu and Shein, major advertisers on U.S. social media, are cutting ad spending due to newly imposed tariffs on low-priced imports. The companies plan to raise prices and reduce ad budgets as costs rise, posing challenges for tech platforms like Meta's Facebook and YouTube.

Chinese retail giants Temu and Shein, known for their aggressive advertising on U.S. social media, are significantly reducing digital ad expenditure, recent industry data reveals. This move is anticipated to strike a blow to tech giants including Meta's Facebook and YouTube.

The cutback follows a recent executive order by U.S. President Donald Trump that nullifies the exemption of tariffs for Chinese goods under $800, effective May 2. This has forced Temu and Shein to consider raising product prices to offset rising costs.

According to digital marketing analysts, both retailers have significantly decreased spending on platforms such as Facebook, Instagram, YouTube, and others. Sensor Tower estimates a 31% reduction in Temu's ad spend from March 31 to April 13, while Shein saw a 19% decrease over the same period.

(With inputs from agencies.)