The Absurd Economics of Wish, AliExpress, and Temu
Modern MBA
36 min, 33 sec
The video discusses the unsustainable business model of online platforms selling cheap, unbranded Chinese products, focusing on Wish's decline and comparing it to similar companies like AliExpress and Teemu.
Summary
- Teemu and similar platforms like Wish and AliExpress sell cheap, unbranded Chinese products with promises of low prices, free shipping, and quick delivery.
- These platforms rely on a business model that includes aggressive marketing, subsidized international shipping rates, and high-volume, low-margin sales.
- Wish's failure is attributed to its unsustainable business practices, including reliance on heavy advertising spend and inability to retain a low-income customer base.
- AliExpress remains operational due to Alibaba's other profitable ventures, despite sharing similar challenges with Wish.
- Teemu, backed by PDD, enters the same market space, attempting to address past failures but faces significant challenges and skepticism.
Chapter 1
![Teemu promises affordable shopping with quick delivery, similar to its predecessors Wish and AliExpress, which have historically sold low-cost Chinese products online.](https://www.videogist.co/rails/active_storage/representations/redirect/eyJfcmFpbHMiOnsiZGF0YSI6NTQxNTksInB1ciI6ImJsb2JfaWQifX0=--fa7b9efb74a25cb476515798718e86d16457c8de/eyJfcmFpbHMiOnsiZGF0YSI6eyJmb3JtYXQiOiJqcGciLCJyZXNpemVfdG9fbGltaXQiOls3MjAsbnVsbF19LCJwdXIiOiJ2YXJpYXRpb24ifX0=--c9426325207613fdd890ee7713353fad711030c7/3259_27.jpg)
Teemu promises affordable shopping with quick delivery, similar to its predecessors Wish and AliExpress, which have historically sold low-cost Chinese products online.
- Teemu promises low prices, free shipping, and quick delivery times on cheap electronics, gadgets, and clothes.
- Wish and AliExpress previously entered the market with similar value propositions, including wacky ads and low prices.
- These companies questionably sustain their businesses selling very low-cost items online.
![Teemu promises affordable shopping with quick delivery, similar to its predecessors Wish and AliExpress, which have historically sold low-cost Chinese products online.](https://www.videogist.co/rails/active_storage/representations/redirect/eyJfcmFpbHMiOnsiZGF0YSI6NTQxNTksInB1ciI6ImJsb2JfaWQifX0=--fa7b9efb74a25cb476515798718e86d16457c8de/eyJfcmFpbHMiOnsiZGF0YSI6eyJmb3JtYXQiOiJqcGciLCJyZXNpemVfdG9fbGltaXQiOls3MjAsbnVsbF19LCJwdXIiOiJ2YXJpYXRpb24ifX0=--c9426325207613fdd890ee7713353fad711030c7/3259_27.jpg)
Chapter 2
![Rolo, a shipping company, is disrupting the industry with cost-effective solutions for shipments, boasting significant savings and convenient services.](https://www.videogist.co/rails/active_storage/representations/redirect/eyJfcmFpbHMiOnsiZGF0YSI6NTQxNjEsInB1ciI6ImJsb2JfaWQifX0=--d9018ab95f85f7c2e01f4d722bd377e8cebf811a/eyJfcmFpbHMiOnsiZGF0YSI6eyJmb3JtYXQiOiJqcGciLCJyZXNpemVfdG9fbGltaXQiOls3MjAsbnVsbF19LCJwdXIiOiJ2YXJpYXRpb24ifX0=--c9426325207613fdd890ee7713353fad711030c7/3259_97.jpg)
Rolo, a shipping company, is disrupting the industry with cost-effective solutions for shipments, boasting significant savings and convenient services.
- Rolo offers tools to save time and money in shipping, targeting users who ship frequently.
- With no signup or monthly fees, Rolo provides discounted rates with major carriers and a convenient app.
- Rolo's thermal printer and $10 shipping credit promotion are highlighted.
![Rolo, a shipping company, is disrupting the industry with cost-effective solutions for shipments, boasting significant savings and convenient services.](https://www.videogist.co/rails/active_storage/representations/redirect/eyJfcmFpbHMiOnsiZGF0YSI6NTQxNjEsInB1ciI6ImJsb2JfaWQifX0=--d9018ab95f85f7c2e01f4d722bd377e8cebf811a/eyJfcmFpbHMiOnsiZGF0YSI6eyJmb3JtYXQiOiJqcGciLCJyZXNpemVfdG9fbGltaXQiOls3MjAsbnVsbF19LCJwdXIiOiJ2YXJpYXRpb24ifX0=--c9426325207613fdd890ee7713353fad711030c7/3259_97.jpg)
Chapter 3
![Wish, once a Silicon Valley unicorn, epitomized the booming tech trends but eventually faced a harsh decline due to its unsustainable business model.](https://www.videogist.co/rails/active_storage/representations/redirect/eyJfcmFpbHMiOnsiZGF0YSI6NTQxNjMsInB1ciI6ImJsb2JfaWQifX0=--895b46a1c1a615951445148966c27500a9664c62/eyJfcmFpbHMiOnsiZGF0YSI6eyJmb3JtYXQiOiJqcGciLCJyZXNpemVfdG9fbGltaXQiOls3MjAsbnVsbF19LCJwdXIiOiJ2YXJpYXRpb24ifX0=--c9426325207613fdd890ee7713353fad711030c7/3259_498.jpg)
Wish, once a Silicon Valley unicorn, epitomized the booming tech trends but eventually faced a harsh decline due to its unsustainable business model.
- Wish's initial success was fueled by Silicon Valley's platform business craze, but poor product quality and tactics led to its downfall.
- Despite its platform model, Wish's financials were poor at IPO and continued to worsen, leading to a 99% drop in valuation post-IPO.
- Founder and CEO Peter Szulczewski's resignation and the company's failure to adapt underscored the flawed business model.
![Wish, once a Silicon Valley unicorn, epitomized the booming tech trends but eventually faced a harsh decline due to its unsustainable business model.](https://www.videogist.co/rails/active_storage/representations/redirect/eyJfcmFpbHMiOnsiZGF0YSI6NTQxNjMsInB1ciI6ImJsb2JfaWQifX0=--895b46a1c1a615951445148966c27500a9664c62/eyJfcmFpbHMiOnsiZGF0YSI6eyJmb3JtYXQiOiJqcGciLCJyZXNpemVfdG9fbGltaXQiOls3MjAsbnVsbF19LCJwdXIiOiJ2YXJpYXRpb24ifX0=--c9426325207613fdd890ee7713353fad711030c7/3259_498.jpg)
Chapter 4
![AliExpress, similar to Wish in its offerings, survives due to Alibaba's larger profitable operations, despite never turning a profit on its own.](https://www.videogist.co/rails/active_storage/representations/redirect/eyJfcmFpbHMiOnsiZGF0YSI6NTQxNjUsInB1ciI6ImJsb2JfaWQifX0=--c9b22674985900e975cfbdb60fde3c7110930d04/eyJfcmFpbHMiOnsiZGF0YSI6eyJmb3JtYXQiOiJqcGciLCJyZXNpemVfdG9fbGltaXQiOls3MjAsbnVsbF19LCJwdXIiOiJ2YXJpYXRpb24ifX0=--c9426325207613fdd890ee7713353fad711030c7/3259_1089.jpg)
AliExpress, similar to Wish in its offerings, survives due to Alibaba's larger profitable operations, despite never turning a profit on its own.
- AliExpress operates on the same unsustainable model as Wish, offering cheap goods with subsidized shipping from China.
- It remains operational due to Alibaba's success in other ventures, allowing it to subsidize AliExpress's losses.
- AliExpress targets emerging markets and has a much smaller impact on Alibaba's overall revenue.
![AliExpress, similar to Wish in its offerings, survives due to Alibaba's larger profitable operations, despite never turning a profit on its own.](https://www.videogist.co/rails/active_storage/representations/redirect/eyJfcmFpbHMiOnsiZGF0YSI6NTQxNjUsInB1ciI6ImJsb2JfaWQifX0=--c9b22674985900e975cfbdb60fde3c7110930d04/eyJfcmFpbHMiOnsiZGF0YSI6eyJmb3JtYXQiOiJqcGciLCJyZXNpemVfdG9fbGltaXQiOls3MjAsbnVsbF19LCJwdXIiOiJ2YXJpYXRpb24ifX0=--c9426325207613fdd890ee7713353fad711030c7/3259_1089.jpg)
Chapter 5
![Teemu, launched by PDD, aims to replicate the group purchase model success from China in the international market, despite the precedents set by Wish and AliExpress.](https://www.videogist.co/rails/active_storage/representations/redirect/eyJfcmFpbHMiOnsiZGF0YSI6NTQxNjcsInB1ciI6ImJsb2JfaWQifX0=--ed25b6ff9209f7d0d5c97b30ccf86fb9dc921434/eyJfcmFpbHMiOnsiZGF0YSI6eyJmb3JtYXQiOiJqcGciLCJyZXNpemVfdG9fbGltaXQiOls3MjAsbnVsbF19LCJwdXIiOiJ2YXJpYXRpb24ifX0=--c9426325207613fdd890ee7713353fad711030c7/3259_1754.jpg)
Teemu, launched by PDD, aims to replicate the group purchase model success from China in the international market, despite the precedents set by Wish and AliExpress.
- PDD, after rapid growth in China, launches Teemu to maintain its growth trajectory by entering international markets.
- Teemu's success is uncertain, facing challenges similar to Wish and AliExpress, and skepticism about the sustainability of its business model.
- The company aims to overcome past failures and adapt to new markets, cultures, and consumer demands.
![Teemu, launched by PDD, aims to replicate the group purchase model success from China in the international market, despite the precedents set by Wish and AliExpress.](https://www.videogist.co/rails/active_storage/representations/redirect/eyJfcmFpbHMiOnsiZGF0YSI6NTQxNjcsInB1ciI6ImJsb2JfaWQifX0=--ed25b6ff9209f7d0d5c97b30ccf86fb9dc921434/eyJfcmFpbHMiOnsiZGF0YSI6eyJmb3JtYXQiOiJqcGciLCJyZXNpemVfdG9fbGltaXQiOls3MjAsbnVsbF19LCJwdXIiOiJ2YXJpYXRpb24ifX0=--c9426325207613fdd890ee7713353fad711030c7/3259_1754.jpg)
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