E-Commerce Upstart Temu Invades Nigeria In Aggressive Africa Push

Temu, the Chinese-born e-commerce juggernaut, has entered Nigeria with its signature direct-from-manufacturer model, promising to revolutionise online shopping in Africa’s most populous country.

This launch, on the back of an aggressive marketing blitz that is generating buzz across social media, comes months after its debut in South Africa. It signals Temu’s intent to take on entrenched players like Jumia while redefining consumer expectations in Africa’s burgeoning e-commerce space.

Temu’s foray into Nigeria is a calculated move, leveraging a model that has disrupted markets across the globe. By eliminating middlemen and offering factory-direct pricing, the platform has captivated price-sensitive consumers in over 80 countries. The company’s spokesperson told WT that Temu began serving customers in Nigeria in November having spotted a growing consumer demand for quality, affordable products.

“We identified a growing consumer demand in Nigeria for quality and affordable products and are proud to introduce our direct-from-factory model to the market. Our goal is to provide a secure and trustworthy platform where consumers can shop at ease for quality and affordable products.

This strategy echoes Temu’s rapid penetration into South Africa earlier this year. The company, along with fellow Chinese-owned rival Shein, rapidly gained traction there, undercutting local e-commerce players with ultra-low prices and swift delivery times. South Africa’s top e-tailer Takealot sold its fashion arm Superbalist in September while decrying unfair practices of foreign players muscling in. Additionally, Jumia recently quit South Africa amid intensified competition.

However, Temu’s onslaught hasn’t been without controversy. South African businesses have voiced concerns about Temu’s aggressive pricing strategies eroding market share, while the government has pushed back, considering new tax frameworks to level the playing field for domestic operators.

Nevertheless, the upstart is unrelenting and willing to spend big to get its way. Indeed, Temu’s marketing spend is staggering, reportedly investing nearly USD 500 M every quarter on promotions and advertisements. This has allowed it to flood social media and app stores with offers that are hard to miss, including limited-time deals, prize wheels, and referral rewards. It’s been reported that Temu’s total sales soared from USD 3 M in September 2022 to USD 400 M by April 2023.

Unsettling the Status Quo

Temu’s entry into Nigeria marks a direct challenge to Jumia, Africa’s leading e-commerce platform, which has long dominated the market but is currently battling stagnation and operational hurdles. Jumia reported a 13% decline in year-over-year revenue for Q3 2024 and has struggled to grow its customer base, which has been stuck at around 2 million users since 2023.

Jumia’s ongoing losses, exceeding USD 1 B since its 2019 IPO, and its discontinuation of several verticals and retreat from underperforming markets like South Africa and Tunisia highlight its vulnerabilities. In response to these challenges, Jumia has expanded into rural areas with a network of pickup stations aimed at reducing delivery costs.

While this “upcountry” strategy could broaden its reach, Temu’s reputation for rock-bottom prices and customer-centric policies—such as a 90-day money-back guarantee and robust anti-fraud measures—sets a new bar for competition. Temu would be keen to find an edge as the Nigerian expansion also means going toe-to-toe with fellow Chinese e-tailer AliExpress, popular with Nigerian online shoppers buying foreign goods.

Meanwhile, Jumia’s withdrawal from South Africa came just months after the local e-commerce landscape was shaken by the official launch of Amazon.co.za. The arrival of the global retail giant in May 2024 brought heightened competition to an already competitive market.

Jumia CEO Francis Dufay hinted at this intense competition recently, noting that in South Africa, “growth potential was definitely more difficult,” particularly in an environment where local and international retailers are fiercely vying for market share.

The Nigeria Challenge

The Nigerian market, with its 200 million-plus people and growing middle class, is a natural next target for the app, which has already made waves globally with its low prices and engaging shopping experience.

In the past, Nigeria has been a tough nut to crack for many global players amid myriad challenges, but Temu is making a bold bet that it can succeed where others have struggled. According to Temu’s spokesperson, the company’s unique business model, which focuses on direct-to-consumer sales from manufacturers and aggressive discounting, is designed to make online shopping accessible to everyone, even in markets with infrastructure challenges like Nigeria.

But Nigeria’s logistics landscape, often marked by inefficiencies and mistrust, is a challenge Temu must navigate. The company has partnered with local delivery firms Flytexpress and Speedaf to address these obstacles. “We are still in the initial stages of operations and focused on learning about local preferences to better tailor our services,” said Temu’s spokesperson.

To bolster consumer trust—a perennial concern in Nigerian e-commerce—Temu emphasises its encrypted payment systems, certification by Germany’s DEKRA cybersecurity standard, and membership in the Anti-Phishing Working Group. These measures, coupled with features like real-time shipment tracking and 24/7 customer service, are designed to reassure new users wary of online fraud.

Temu’s launch in Nigeria comes after its rapid global ascent. Since its U.S. debut in 2022, the platform has captured significant market share, outpacing rivals like Shein in North America and entering over 80 markets worldwide. However, its aggressive growth has drawn scrutiny. In the U.S., Temu faces legal battles over alleged anti-competitive practices, and its links to Chinese counterpart Pinduoduo—suspended from Google Play earlier this year due to malware allegations—have raised ethical questions.

South Africa provided Temu with a testing ground for navigating African markets. Its success there, despite backlash from local businesses and regulatory bodies, has likely informed its strategy for Nigeria. By leveraging its lessons from this initial African foray, Temu aims to solidify its foothold in a market projected by McKinsey to surpass USD 75 B in e-commerce sales by 2025.

Temu’s expansion into Nigeria marks a pivotal moment in Africa’s e-commerce evolution. Its disruptive pricing model and focus on consumer trust create both opportunities and challenges for a market long dominated by local players. However, whether Temu can replicate its global success in Africa’s uniquely complex environments remains to be seen.

For now, Temu’s combination of affordability, direct-from-factory efficiency, and customer-centric policies has set the stage for a showdown. As the competition intensifies, the ultimate winners will likely be African consumers—provided the fierce rivalry spurs innovation without compromising quality or sustainability.