Platform ecommerce in Southeast Asia has become a three-horse race. Per Momentum Works’ estimates in The Ecommerce in Southeast Asia 2026 Report, Shopee, TikTok Shop and Lazada together captured 98.8% of regional GMV in 2025.
In one of the four major shifts we have identified, we made an argument that “Ecommerce in SEA has not reached its true price floor”. A few investors have written in to discuss this point in more detail. Coincidentally, when we released the Report in Chinese, we received a few enquiries along the lines of “What about Temu? Will they enter Southeast Asia big time?”
These are fair questions. Temu has been a phenomenon in Europe and North America, and is now a mainstream player across Latin America. In Southeast Asia, by contrast – even in the Philippines, where Temu has done relatively well – it remains a marginal player.
Our estimate is that Temu’s full-year 2025 GMV in the Philippines didn’t even clear US$50 million.
Over the past year, Temu has rolled out semi-consignment (or “semi-management) mode in the Philippines and Malaysia. It has been suspended in Vietnam for over a year and a half and hasn’t pushed particularly hard to get reinstated.
Meanwhile, Pinduoduo, Temu’s cousin for the Chinese domestic market, quietly launched direct free-shipping to Thailand in March this year.
So the natural question is: what exactly is Temu – or more broadly, the Pinduoduo model – to Southeast Asia?
The two explanations you usually hear
There are two readings that get repeated a lot:
- “Shopee is already running such a low-price playbook – there’s no room left for Temu.”
- “The regulatory environment is tightening, and Temu has lost its cross-border advantage.”
Both sound reasonable on the surface.
On the price argument: it’s true that Temu doesn’t have an obvious price edge in the region. Shopee’s prices are already low – subsidies, discounts and stacking vouchers have pushed end-prices down to a level most users already consider “cheap enough.”
For Temu to undercut that by enough to make people switch is much harder than it was in the West. In the US and Europe, Temu’s reference point was Amazon. In Southeast Asia, the reference point is a platform that was built on low prices to begin with.
On the supply side: Temu’s edge in the West was connecting Chinese factories – and the various operators who know how to source low-cost goods from them – directly to Western consumers. But in Southeast Asia, Shopee and TikTok Shop are already full of Chinese sellers and brands. Many sellers on Shopee have China backgrounds, and are sitting on the same supply pool that Temu draws from.
Layer on the regulatory shifts we discussed in The Ecommerce in Southeast Asia 2026 Report: Thailand has scrapped its de minimis exemption; Vietnam has introduced a dedicated E-commerce Law; Indonesia’s Finance Minister Purbaya recently openly voiced concerns about Chinese platforms’ dominance (though that seems mainly aimed at TikTok Shop). Cross-border small parcels were Temu’s most comfortable position globally – and that position is being squeezed.
What conventional wisdom misses
Both arguments have merit, but we’d add two things: there is more than one way to deliver low prices, and the fact that Temu hasn’t broken through in Southeast Asia doesn’t mean it can’t.
Shopee’s official take rate has climbed from 8.6% in 2022 to 13.5% by the end of last year. Sellers of small, unbranded merchandise will tell you the real number for them can often be much higher – once you add commission, ads, logistics and the various other line items, the platform’s effective cut of GMV often approaches 30%.
And yet over the same period, Shopee’s GMV has continued to grow fast – up around 25% in 2025.
Take rates rising, GMV growing, sellers complaining but staying – these three things happening simultaneously tell you something important: Southeast Asian ecommerce hasn’t hit the price floor yet.
A large chunk of what consumers see as “cheap” today is actually rent the platform is extracting from sellers and rebating back as subsidies.
That’s artificial low pricing, not structural low pricing. The two look similar at the checkout page, but the underlying business models are completely different. The first works by reallocating costs within the ecosystem. The second works by actively changing the supply chain using consumer traffic as a weapon.
So the “Shopee already runs the low-price playbook, where’s the room?” argument is right on the subsidy-driven dimension. But on the structural dimension, the market is far from optimised. A player willing to go deep into the supply chain and rebuild the middle layer could push the floor a lot lower than most people assume.
The user base most platforms haven’t reached
Then there’s the user side.
Shopee and TikTok Shop have done a good job extending ecommerce from the original cohort of internet- and digital-payment-enabled users to a much broader audience. But further down the income curve, there is still a large pool of price-sensitive demand being served at wet markets, mom-and-pop stores and traditional wholesale channels – or arguably, not being served by any modern retail channel at all.
Bringing that demand online requires structural cost reduction across a much wider product range. That is exactly what the Pinduoduo model is built for. And it’s the same script that played out in China.
As for regulation – yes, it has constrained pure cross-border models in some markets (or at least eroded their price advantage), but it hasn’t blocked Chinese supply chains.
Pinduoduo and traditional ecommerce are different species
Step back and the picture gets clearer. Pinduoduo and traditional ecommerce platforms are fundamentally different animals.
Traditional platforms are essentially fighting over traffic gateways. Whoever keeps users in their app gets to dictate how everyone else in the ecosystem makes money. Take rates, ads, subsidies, livestreaming – all the levers come back to the same logic: control the gateway, charge a toll at every step.
Pinduoduo’s logic is different. It uses order volume to pressure suppliers into giving up margin. Whoever can price lower gets the next wave of orders. Whoever can’t, gets filtered out. The platform doesn’t lean on operations and big sales events – its stickiness comes from one promise: we’ll get you the lowest price. And that stickiness, in turn, lets it set the rules for the supply side.
Fundamentally, this is the discount retailer model – and Pinduoduo is an upgraded and digitised version of that logic.
In any mature, competitive retail market, both models will eventually go head-to-head in certain categories. Long-term share depends on what consumers actually value most, and which side suppliers are willing to cooperate with. China has already played out one full cycle of this story over the past decade.
But the model alone isn’t enough – the ecosystem matters
The reason Pinduoduo could work in China wasn’t just the model. It was the surrounding infrastructure: the industrial clusters, the hyper-mature express delivery network, WeChat Pay as a near-universal payment rail, and a decade of accumulated factory capacity looking for a route to consumers without a brand.
None of these are fully in place in Southeast Asia today.
So whether the Pinduoduo model can show up in Southeast Asia depends not just on whether someone wants to build it, but on when the ecosystem is ready – or alternatively, on whether someone is willing to spend several years building the missing pieces themselves before the rest of the ecosystem catches up.
Sellers vote with their feet
Then there’s the seller side.
Take rates climb, ads get more expensive, platform rules change without warning – sellers feel all of it. They just don’t have a better alternative. Plenty of sellers today complain about the regional platforms while continuing to buy ads on them. Not because they want to, but because where else can they find the consumer traffic?
When a new platform shows up offering sellers a better deal, sellers move. Almost every major shift in platform dynamics has had seller migration underneath it. Shopee taking the lead in Indonesia from Lazada in 2017, TikTok Shop reaching ~60% of Shopee’s GMV in just a few years – these weren’t only consumer choices. They were seller choices too.
So if there is a next platform-level shift, it will almost certainly come with white-label sellers and other supply moving with it.
So where does that leave Temu?
Temu currently sells into four Southeast Asian markets, which tells you the cross-border infrastructure works. The fact that it isn’t pushing aggressively – and isn’t actively working to return to Vietnam – tells you the ROI on incremental investment here in Southeast Asia just isn’t as attractive for Temu as, say, in Europe. (We suspect Meituan’s Keeta has reached a similar conclusion about not prioritizing Southeast Asia.)
A note on the regional VC scene as well: after Pinduoduo’s IPO in 2018, many investors went on a hunt for “Southeast Asia’s Pinduoduo.” Several of our friends who’d worked at Lazada were approached with what was effectively a homework assignment – “build a Southeast Asian social commerce Pinduoduo, we’ll give you the seed cheque.”
Fortunately, none of them took the bait.
