Shein, Temu Branch Further into Toy Market Amid Worry Over Fake Products

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New York: Fast-expanding e-commerce platforms Temu and Shein are making significant inroads into the toy market as they look to capitalize on holiday shopping, with many American and European consumers preparing to hunt for steep discounts during the Black Friday weekend. Historically, these platforms, known for offering low-cost goods primarily through mobile apps, have not been traditional destinations for toys and holiday gifts. Both sites, which have earned a reputation for selling mostly unbranded items such as bath towels, clothes, and home appliances, are now positioning themselves as competitors in the global toy market. According to market research firm Circana, toys generated $108.7 billion in sales worldwide in 2023, making the sector a key target for these e-commerce platforms aiming for growth. At Shein, which became known for offering budget-friendly clothing, toys have emerged as one of the fastest-growing categories. The company reported double-digit percentage growth in toy sales year-over-year, with toys increasingly becoming a significant part of their sales volume.

Temu, too, has noted a rise in toy-related searches on its platform, signaling growing consumer interest in purchasing toys online. Despite this surge, major retailers like Amazon, Walmart, and Target continue to dominate the US toy market, accounting for nearly 70% of toy sales. Nonetheless, the share of US holiday shoppers planning to purchase gifts on Temu has increased to 13%, up from 9% last year, according to market research firm Kantar. Additionally, US credit card spending on both platforms has risen in comparison to 2023, as noted by data firm Facteus.

The rise of Shein and Temu in the toy market has drawn attention from traditional toy manufacturers, including MGA Entertainment, known for its LOL Surprise! dolls. CEO Isaac Larian expressed that the company is considering selling on these platforms to reach a wider audience. Both platforms primarily appeal to consumers with annual incomes under $50,000, many of whom have turned to e-commerce for deals amid rising consumer prices since 2021. With more low-income shoppers seeking bargains, especially in the lead-up to the holiday season, Temu and Shein are poised to further increase their market share in the competitive toy market.