Australian e-commerce is rolling up! Who will have the last laugh between Amazon and Temu?

Recently, the Australian e-commerce scene has been anything but calm.

The long-established e-commerce platform Catch, which once thrived in the local market, has surprisingly announced its closure, shocking many. Meanwhile, two cross-border giants—Amazon and Temu—are fiercely battling it out. One has cultivated the market for years with a strong supply chain and membership system, while the other is rapidly conquering territory with ultra-low prices and aggressive subsidies. The landscape of the Australian e-commerce market is being completely reshaped.

So, who will have the last laugh—Amazon or Temu? Where should Australian local e-commerce go from here? What kind of business logic is hidden behind this e-commerce war?

Catch announces closure. Image source: Catch Marketplace

How attractive is the Australian e-commerce market?

As global e-commerce competition intensifies, Australia has become a "potential stock" in the eyes of major e-commerce platforms.

According to Statista, by 2025, the Australian e-commerce market is expected to reach $42.22 billion, and expand to $58.03 billion by 2029, with an average annual growth rate of about 8%. Although the growth rate is not as fast as Southeast Asia or Latin America, it is stable, and Australian consumers generally have strong purchasing power, leaving plenty of market space.

Australian e-commerce market revenue continues to grow. Image source: Statista

More importantly, Australian consumers have already developed a habit of "loving online shopping." A survey by IAB shows that among 1,000 Australian respondents, 83% shop online at least once a month, and many have formed fixed online consumption patterns. Such market trends naturally attract global e-commerce giants to compete for a share of the pie.

Australian consumers "love online shopping" Image source: Statista

Amazon VS Temu, who will come out on top?

Amazon: The steady industry giant

Amazon hasn't been in the Australian market for very long—it officially entered in 2017—but with its global supply chain, Prime membership services, and brand influence, it quickly became a key player in the local e-commerce market. Currently, Amazon holds about 10% of the Australian market share and is expected to increase this to 25% by 2030.

Amazon's advantages lie in its wide variety of products, robust supply chain, and highly competitive Prime delivery service. Compared to other platforms, Amazon users tend to be "loyal"—as long as the experience is good, they rarely switch shopping platforms.

Amazon has become Australia's largest e-commerce platform. Image source: News.com.au

Temu: The aggressive rising star

In contrast, Temu's approach is completely different. As a cross-border e-commerce platform under Pinduoduo, Temu hasn't been in the Australian market for long, but in just one year, more than 3.8 million Australian consumers have placed orders on Temu, and its market share is close to one-fifth. According to Similarweb, Temu's unique visitors in Australia grew by 72% over the past year, making it the fastest-growing e-commerce platform locally.

Temu's core competitiveness is "cheap." Relying on China's powerful supply chain, Temu ships directly from factories, eliminating middlemen and making product prices much lower than the market average. At the same time, Temu invests heavily in marketing, placing large amounts of social media ads and attracting new users through subsidies, drawing in a large group of consumers who love low-priced shopping.

However, can Temu's model be sustained in the long run? This is a concern for many. After all, the subsidy strategy can't last forever—once subsidies decrease, will users continue to buy? In addition, Temu's logistics efficiency and product quality are also challenges. To truly challenge Amazon, Temu needs to keep improving in these areas.

Temu is growing rapidly in Australia. Image source: insideretail

Local e-commerce under great pressure—who can survive?

The fierce competition between Temu and Amazon has directly squeezed the survival space of Australian local e-commerce. Catch's downfall is a typical case—this well-known Australian e-commerce platform lost more than AUD 350 million in the past three and a half years and finally announced it will shut down completely on April 30, 2025.

This is not just an isolated case in Australia; similar situations are happening in other countries. For example, Korea's Tmon and Wemakeprice, under the impact of cross-border e-commerce platforms like Temu and AliExpress, also suffered capital chain breaks, leading to the closure of more than 6,000 online stores. It can be said that the rise of cross-border e-commerce has forced local platforms to face fiercer competition.

Image source: Internet

The Australian e-commerce war has just begun!

At present, the competition in Australian e-commerce has just begun. In the coming years, the battle between Amazon and Temu will continue. Can Temu maintain its low-price strategy in the long run? Will Amazon adjust its approach to further seize market share? These questions remain to be seen.

For consumers, this e-commerce war is undoubtedly a good thing. Lower prices, better services, and faster logistics all improve the shopping experience. For merchants, it is both an opportunity and a challenge—how to find a way to survive in a fiercely competitive market will be a question worth pondering in the coming years.