The growth of the online shopping platform Temu is remarkable, but ethically problematic. People are lured into making purchases based on temptation, fear of missing out, and the need for social belonging.
Five pairs of socks shipped to your home for €1.49 or fashionable sunglasses for less than €3 – whatever one wants and might need or not, on its shopping platform Temu offers it for amazingly cheap prices. With its slogan ‘Shop like a billionaire’, the company’s app, which started as recently as fall 2022, achieved more than 50 million downloads in June 2024 alone, making it more popular than the app of Amazon according to Statista.
However, the cheap prices come with a cost. In May 2024, 17 European consumer protection organizations filed a complaint, arguing that Temu infringes the Digital Services Act in several ways. Legally unacceptable practices include, among others, the use of dark patterns, i.e. ways that deceive or manipulate consumers and “distorts or impairs [their ] … ability … to make free and informed decisions”. This concern is echoed by a small study by Jip Sonnemans at Radboud University in the Netherlands, which researched how young adult users experienced the platform and its marketing tactics.
In this article, we highlight three tactics that Temu used to hook young users, made them to purchase more than they needed, created a constant urge to return to the platform, and encouraged them to ‘share’ links to Temu on social media with others. While most users expressed how the cheap prices attract them, most also shared the negative influence Temu can have on users’ financial, emotional, and mental well-being. As one of the respondents explained “Temu is acting like a gateway drug, trying to get people hooked on the platform … so they will make more purchases.” (Young female respondent)
Spin to win and pay – Temu’s spinning wheel
A distinguishing feature of Temu is how it combines playing online games with shopping. With daily rewards, countdown timers, and progress bars, people are motivated to spend money on the platform while playing small games. One of the most prominent is the ‘spinning wheel’ game, where users can spin a wheel to win discounts or rewards. As one of the respondents explains, “I think you almost have to spin that wheel to proceed on the website. Yes, that’s very prominent. It pops up immediately when you first visit the site”. (Young male respondent)
In the study, young people reported that the spinning wheel and the discounts won motivated them to continue buying products. With such ‘games,’ Temu reframes discounts as gains. Although participants still need to pay for their purchases, the discounts feel like a prize—something typically given for free that winners naturally want to receive. As one respondent noted, “it’s a very much similar feeling to [gambling …] because it’s that brief thrill when you spin the wheel of wondering what you might win. … and of course, you want to take advantage of it. Because I think you’re still in that high from winning, that you immediately say, I want so see what I can do with that prize right now” (Young male respondent).
As illustrated in a BBC documentary on Channel 4 on Temu, shopping on the platform triggers more dopamine in the brain compared to other shopping platforms and has similarities to gambling: customer gamble their way through discounts; they ‘win’ but still spend money. As one of the respondents explained: “If the Wheel of Fortune hadn’t been there or if those discounts weren’t available, I probably wouldn’t have bought it.” (Young female respondent). While more research is needed, the risks of such a ‘retail roulette’ might not only cause overspending on products but also developing an addiction to the ‘kick’ of winning a prize.
The social trap – Temu’s fish game
A core reason why Temu has grown so rapidly, may be its strategy of incentivizing users to recruit new ones. While referral marketing—where businesses encourage existing customers to recommend products or services to friends, family, and colleagues—is a longstanding strategy, Temu takes it to a new level. In its ‘fish game’ users feed a digital fish with referrals to earn free products or discounts. To keep their fish alive, they need to continuously encourage others to shop as well.
To avoid the negative feelings associated with failing to keep their fish alive or failing to receive certain discounts or promotions, customers reach out to others. As a consequence, friends and family of Temu users, are asked to help by purchasing on Temu with their friends or family members discount codes. As a young female user explains in a review on Reddit, “What does drive me insane is the MLM [multi-level marketing] style ‘points, gifts & rewards’ you are spammed with mercilessly. What’s worse is the friends on social media constantly posting links to [their discount codes …], on their page & in your DMs [direct messages].“
Tapping into one’s social networks this way, can also lead to negative feelings. It might erode trust between individuals or evoke feelings of shame and guilt, as a young man explained: “The promotions are in your face, hard to get rid of and chock full of false promises. It says it is going to give you credits, and then it only gives you a fraction of that amount. And for each successive referral, the credit given is cut in half (or more), making it impossible to achieve the promotion […] and [I] have unknowingly relayed false promises to my friends and family, all to get them to join this crappy app with crappy misleading products.” (Young male respondent)
With such tactics, Temu places customers who are sensitive to them, in a double bind: they must either accept feeling guilty for failing or endure the discomfort of repeatedly asking friends and family to shop. In the end, users are caught between feeling bad either way.
A bargain to belong – how Temu uses FOMO
In line with the EU consumer protection complaint, the study shows that respondents felt pushed to purchase products due to discounts that appeared exclusive but were not, seemed time-limited but might not, and offers that simply did not turn out as advertised. One respondent explained, for example, that allegedly ‘free’ products come with many conditions that only become clear over time: “Be Aware. I am writing about the FALSE advertisement with TEMU’s – New Promotion. They start with their usual offer of 5 to 6 free items for $0.00. … then [you …] find out that it only depends on referrals. …. So, they have you waste time lining up your order, then tell you the total, then play shell games to reduce it, and finally, ask for your referrals the rest of the way.” (Young male respondent)
While certain ways of misleading customers are forbidden, in the study young adults reported a whole range of tactics that enticed them to spend more than they could afford, to purchase products they didn’t need, and that created frustration about their impulsive buying behavior. As one respondent explained: When a product is “off, oh, it’s cheap again, then I have to get it again quickly before this discount is gone. And if that comes back frequently and especially if it passes by your algorithm a lot, then I think it can be detrimental to maybe also your mental health, but also just your financial resources.” (Young male respondent)
In addition, Temu seems to effectively combine a sense of urgency and scarcity through discounts with the social pressure to not miss out. Young adults reported that Temu’s heavy use of influencers on TikTok, Instagram, and YouTube (as also outlined by the complaint of consumer agencies), fueled hypes around products they felt they need to buy, too. With its marketing tactics, Temu co-opts users in creating an urge among followers to own certain products. Messages to join bargains to achieve a group discount or to ‘help’ others through purchasing with their discount codes, intensifies young people’s engagement with Temu’s app, up to several times a day. This has, “negative consequences for young adults, who are sensitive to social pressure”, as a young male respondent shared, “yes, I think FOMO (fear of missing out). People think of such [sun] glasses … ‘I must have them too!’ And if they don’t have them, that they don’t belong.”
Ethical concerns and regulatory needs
Temu’s growth is remarkable. In this text, we highlighted three tactics that deserve more attention: Temu combines shopping with gaming, harvests customers’ social relations for higher revenue, and leverages FOMO with the need to belong.
While the EU complaint addresses legally inappropriate behavior under the Digital Services Act, we want to express our concern about tactics that, even if not illegal, are ethically problematic. Young people are lured into making purchases based on temptation, fear of missing out, and the need for social belonging.
These tactics can negatively impact individuals’ mental well-being and contribute to feelings of guilt towards others and regret over overspending. Furthermore, we regard the normalization of excessive consumption and the use of friends to drive more purchases as societally undesirable marketing strategies.
While Temu for sure is not the only company that seeks to increase its revenue with practices that are ethically questionable, our study underscores the need to speed up efforts to protect consumers in the digital marketplace. First, children, even before they are able to spend money online, need to be better educated to achieve a level of media literacy and critical thinking skills that can effectively counter today’s multiple and intricate marketing strategies. Second, existing consumer protection rules need to be well-enforced. The digital marketplace is vast, but monitoring and holding accountable those companies that do not comply with consumer protection laws is essential to curb the excesses of current marketing practices. Third, shopping platforms and social media have fundamentally transformed how companies offer products and services. New and stricter regulations are needed to curb practices that, in intricate and potentially problematic ways, lead users to shop more than they want, need, or can afford, and involve them in recruiting others to do the same.
References
Bureau Européen des Unions de Consommateurs (2024): Taming Temu: Why the fast-growing online marketplace fails to comply with the EU Digital Services Act, available: https://www.beuc.eu/sites/default/files/publications/BEUC-X-2024-046_Temu_Why_the_fast-growing_online_marketplace_fails_to_comply_with_the_DSA.pdf
Channel 4 (2024): The Truth About Temu: Dispatches. Available: https://www.channel4.com/press/news/truth-about-temu-dispatches-thursday-30-may-8pm-channel-4,
Sonnemans, J. (2024): Temu: Sell your friends to shop like a billionaire – A netnography study on the influence of referral marketing on young adults‘ buying behavior. Master Thesis. Available https://theses.ubn.ru.nl/items/11e2f24f-aa73-4611-b88c-1ddb6ef1a7b4
Thomala, L.L. (2024): Monthly global downloads of Temu shopping app 2022-2024. Available: https://www.statista.com/statistics/1393504/temu-number-of-app-downloads-worldwide/
Dr. Claudia Gross, PhD in Business Administration, Magistra Artium in Sociology and Philosophy, Assistant Professor for Organisational Design and Development, Institute for Management Research at Radboud University in Nijmegen, the Netherlands.
Jip Sonnemans, MSc Organisational Design & Development, Advisor Business Contacts ABN AMRO Bank N.V., in Nijmegen, the Netherlands