Notably the United Kingdom and France, in response to recent U.S. trade policy changes that have increased operational costs. In April, Shein increased its digital advertising expenditure by 100% in the UK and 45% in France compared to the previous year, while Temu raised its spending by 20% in the UK and 115% in France during the same period

This strategic pivot follows the U.S. government’s decision to eliminate the de minimis trade exemption, which previously allowed packages valued under $800 to enter the country duty-free. The removal of this exemption has led to significant price hikes for products from these retailers in the U.S., with items like $10 dresses now costing $24.50 due to new tariffs

In response, both companies have reduced their advertising budgets in the U.S.—Temu by 31% and Shein by 19%—and are reallocating resources to European markets where they see growth potential . This shift has resulted in increased app downloads in the UK, with Shein experiencing a 25% rise and Temu more than doubling its downloads. However, daily active user growth has been modest, with Shein up 5% and Temu up 10% month-over-month

Beyond Europe, both companies are also expanding their presence in Brazil. Shein increased its digital advertising spending in Brazil by 140% year-over-year in April, while Temu’s ad spend in the country surged 800 times compared to the same period last year

Marketing experts suggest that while these companies are successfully attracting new users through aggressive advertising, retaining them remains a challenge. The modest increase in daily active users indicates that while initial interest is high, sustained engagement requires further effort. As Shein and Temu continue to navigate the evolving global trade landscape, their ability to adapt to new markets and consumer behaviors will be crucial for their ongoing growth.