To Shein or not to Shein: the billion-dollar question facing every ecommerce player

Love and use it or hate and shun it, you have probably heard of Shein or seen it on TikTok. If short videos aren’t your jam, then you might have noticed the ads sprouting up at bus stops or the hashtag #sheinhaul online.

So what exactly is Shein? Based in Nanjing, China, the ecommerce business started out in 2008 by making wedding dresses at low costs and then selling them overseas for a large profit. Over the years, it has expanded its product range to include all types of women’s fashion.

Image credit: Timmy Loen

Shein shrewdly employed influencer marketing and leaned on social media platforms such as Pinterest to TikTok as it expanded to reach customers in the US, Australia, Europe, and the Middle East. At the same time, the company scours the internet for trends and uses that to inform its manufacturing in real time, allowing it to launch thousands of new items daily.

It has reduced the usual process of designing on a drawing board, producing the clothes, and adding an SKU on its site to just somewhere between three to five days. That’s astonishingly quick even by fast-fashion standards: Zara, once thought to have perfected this business, takes about three weeks to do the same.

But more than just getting fashion trends on fleek, it’s Shein’s ultra-affordable price points (a dress for US$3, anyone?) that’s got millions of budget-conscious Gen Z shoppers hooked.

And it’s eyeing Southeast Asia next.

Fast fashion on steroids

So what if Shein is a hit among young consumers? Why should the industry care?

For the simple reason that it’s getting too big not to. Shein is one of the fastest-growing ecommerce companies in the world, reportedly making US$10 billion in revenue last year, and it’s growing more than 100% each year since 2013.

In May, Shein overtook ecommerce juggernaut Amazon to become the no. 1 shopping app by new downloads in the US on both iOS and Android devices, according to mobile app intelligence platform App Annie.

Shein’s prices are so irresistibly low that it’s hard to stop shopping. According to a report by LatePost, the average order value on the platform is US$70, which could get you around 10 items, ranging from swimsuits and yoga pants to bags and dresses.

On TikTok and YouTube, shoppers excitedly share their Shein buys via try-on videos. As of April, TikTok videos with the hashtag #shein have attracted over 6.2 billion views.

Can Shein succeed in Southeast Asia?

Should incumbents be worried?

Can Shein be copied?

Why “slow” fashion could win the day

Shein’s dark side