Latest / Retail Media Breakfast Club / Amazon Haul Expands As Chinese Competitors Face Tariff Upheaval
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- Amazon Haul positioned strongly against Temu and Shein === [00:00:00] Amazon is expanding its new low cost Haul store at a pivotal moment for cross-border e-commerce. Six months after launching as a mobile only beta. The retail giant has extended Amazon Haul to desktop consumers while broadening its product assortment to include branded items. These are strategic moves that coincide with the Trump administration's implementation of punishing tariffs on direct from China shipments. Let's talk about how the incoming tariffs threaten Chinese shopping apps like Temu and SHEIN, and how Amazon is doubling down on Haul and might be a little bit advantaged versus those Chinese shopping apps. Let's go. So this is an article that I wrote for Forbes, which was published on [00:01:00] April 23. Amazon Haul was launched in November, 2024 as a shopping experience within the Amazon app, and it featured products priced at $20 or less with most items under $10. Amazon Haul initially appeared to be a direct response to the explosive growth of Chinese marketplaces like Temu and Shein. But now, as those platforms face existential threats from new tariff policies, Amazon appears to be doubling down on its own low cost channel. Really, what all this hinges on is the Trump administration's decision to end the de minimus exemption. Which means that starting May 2nd packages from China valued at or under $800 that are shipped through the USPS will face a tariff equivalent to 120% of the goods [00:02:00] value, or a fee of a hundred dollars per package, which may increase in the future. Items shipped through other carriers like UPS will face tariffs as high as 145%. Of the good's value. So this tariff threatens to undermine the whole business model of Temu and Shein, which relied on direct to consumer shipments from Chinese manufacturers to American consumers. Both companies recently posted notices on their websites indicating that consumers will face price adjustments starting April 25, although neither detailed exactly how those costs will be passed, passed along. That was according to the New York Times. Against this backdrop, Amazon is expanding Haul, and while Amazon doesn't, hasn't, doesn't, and hasn't commented specifically on tariff related [00:03:00] topics. The company has made several notable enhancements to the Haul platform in recent weeks. Dharmesh Mehta. Amazon's Vice President of Worldwide Selling Partner Services announced on LinkedIn earlier in April. That Amazon Haul is available on desktop in addition to mobile, making it even easier to shop. They've also added in to its. They're also diversifying Haul's product mix. The company announced the selection now includes branded items, discounted at up to 80%. A new hybrid strategy that combines ultra low price unbranded goods. With recognizable brands at steep discounts, this approach could help haul appeal to price sensitive consumers across different segments. Those primarily motivated at absolute price points like the core Temu or Sheen customer and those seeking [00:04:00] recognized brands. At discounted prices. By combining these two approaches within a single experience, Amazon potentially creates a more sustainable competitive position than pure play ultra discount platforms like Temu and Shein, a key differentiator that Amazon has had right from the beginning though. Is unlike team and shein, which typically ship direct from Chinese manufacturers to American consumers, Amazon Haul taps into the company's established fulfillment inst infrastructure. It's FBA program. This distinction is what could prove critical in navigating the new tariff reality? While the specific implementation details remain unclear, Amazon's domestic fulfillment network potentially shields Haul from the most severe impacts of the de minimis policy changes products that have already been imported in bulk [00:05:00] and stored in Amazon's US warehouses. It may face different or at least more certain tariff treatment. Then direct to consumer shipments where tariffs are calculated individually as they come on shore by the US Customs and Border Protection Agency. Amazon also has. Another advantage here, which is trust in the midst of this cross-border e-commerce uncertainty, Amazon is in emphasizing trust and consumer protection as key differentiators. And this came through in a blog post that they've recently shared to announce the move to desktop. They said Amazon screens the product seller's offer in Haul, so customers can be confident, they'll receive products that are safe, authentic, and compliant with applicable regulations. All items available in Amazon Haul are also covered by [00:06:00] Amazon's longstanding A to Z guarantee, which protects customers when they buy an item in our store and covers product condition even if the item is damaged, defective, or not as described, and this emphasis on product quality and authenticity directly addresses a common concern among American consumers regarding ultra low price imports. According to a survey from Salesforce last year, 37% of people who haven't bought from Chinese marketplaces say payment security concerns are their primary reason for hesitation. Amazon is a trusted company and people trust their credit card details with them. So that is a big advantage, uh, for Amazon is the trust element, but one area where. One area where Amazon still appears to be catching up, is in creating the entertainment focused shopping experience that [00:07:00] has helped Chinese marketplaces thrive. Coming back to that Salesforce survey, it found that among the 21% of Americans who enjoy shopping on Temu. More than traditional shopping. 47% of them specifically enjoy the treasure hunt experience. And this is part of the whole shopping is entertainment aspect of these apps is, it's fun, it's a, it's an escape. It's a different type of experience than the search find buy that people are typically engaged with on Amazon. And so Haul has brought in some of those entertainment oriented elements like younger skewing language, emojis and things like that, but it's still not quite, it still lacks the gamification features and social shopping elements that have made [00:08:00] platforms like Temu addictive for many consumers, but. I think the decision to add Haul to the desktop experience, as well as continuing to position it fairly prominently on the app, but also now on the desktop. This indicates Amazon sees potential in this channel, and you know that virtual real estate, something that Amazon takes very seriously. Another interesting thing I've seen so far is that the main page of the Haul microsite doesn't have any product ads or any display ads. This suggests to me that Amazon's making different strategic play when it comes to Haul. So as, as of the time of recording, may two is still a few days away, so. We are going to need to see what happens here. But it's safe to say there's a lot of uncertainty in the ultra low cost shopping landscape in [00:09:00] particular, and the coming months, I guess, will reveal whether Amazon's measured approach to this. Commerce Channel can continue to compete with the addictive shopping experience created by Chinese marketplaces, and whether American consumers are willing to pay higher prices for those experiences once the tariff reality sets in. For now, Amazon appears to be content in positioning itself for potential market share gains if consumer habits shift in response to those new economic realities.