Temu and Shein Slash U.S. Ad Spend Amid Tariff Changes

Chinese e-commerce giants Temu and Shein are cutting back on their U.S. digital advertising budgets, dealing a blow to major platforms like Facebook (NASDAQ:META), YouTube, and TikTok. This shift follows a new executive order from U.S. President Donald Trump that ends tariff exemptions for imported goods valued under $800, effective May 2.

Temu and Shein, known for offering low-cost, China-made products directly to American consumers, had been aggressive spenders on social media ads. Their campaigns were primarily aimed at younger, budget-conscious shoppers across platforms like Instagram, Facebook, YouTube, TikTok, Snap, and X.

According to data from Sensor Tower, Temu’s average daily ad spending across these platforms fell by 31% between March 31 and April 13 compared to the previous 30 days. Shein’s ad spend declined 19% over the same period on platforms including Pinterest (NYSE:PINS).

Industry insiders say the removal of the “de minimis” tariff exemption is prompting both retailers to raise product prices next week to offset increased import costs. This shift in strategy is also leading to a broader reduction in digital marketing efforts, particularly on Google Shopping, where Temu has pulled back significantly since April 12.

While Meta declined to comment, Google, Temu, and Shein have yet to respond to inquiries. The cutbacks mark a notable retreat from the brands’ earlier aggressive ad push in the first quarter of 2025, potentially signaling a reshaped strategy amid rising trade tensions and shifting U.S. regulations.

This development highlights the growing impact of geopolitical moves on digital advertising trends and the broader e-commerce landscape, especially for platforms heavily reliant on cross-border retail ad spending.