Shein’s market strategy: how the Chinese fashion brand is conquering the West

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Shein is now the largest cross-border fast fashion e-commerce company in China. The e-commerce clothing brand reaches consumers in the United States, France, Russia, Germany and over 200 other countries. According to Airnow Data, in 2021 Shein’s mobile app has exceeded 7 million monthly active users in the US alone. According to Jing Daily, on TikTok, the hashtag #Shein has garnered over 6.2 billion views.

For Westerners, the Shein obsession seems to be appeared out of nowhere. However, this type of explosive growth is increasingly common among new Chinese companies that prioritize revenue and growth before profits. Shein applied a variety of marketing strategies that have proven successful in China within the West.

Shein MAU in the US
Data Source: Airnow, designed by daxue consulting, Shein MAU in the US

What is Shein?

Founded in 2008, Shein is a B2C Chinese online clothing and accessories store. However, it has only recently become popular in the West. It features clothes for women for all occasions and in all sizes, including a huge collection of stylish plus size models that are still rare on the market. There are also categories for men and children, as well as a new section with tiny gadgets and home decorations. With a global warehouse network, Shein is able to ship to over 220 countries and regions worldwide making it one of the fastest-growing fast fashion brands.

The success of Shein in the West

In 2020, Shein announced that sales exceeded 40 billion yuan, and it will hit 100 billion in 2021. According to Google trends, users search for it three times more than some Western brands like Zara. In 2020, Shein launched 150,000 new items throughout the year, with an average of more than 10,000 new items per month. It has caught up with Zara’s annual new product volume in just one to two months, and the speed is still accelerating. In March 2021, Shein’s women’s clothing category alone had an average of 2,000 new products per day.

What makes Shein’s market strategy in the West different?

Although such fast fashion brands like Zara are not expensive – a small dress may cost more than 30 dollars, while a similar dress on Shein costs half that price. The styles of Shein’s clothes are more diverse, and the colors and patterns are more varied. “Sexy” is a key clothing style on Shein. Additionally, Shein’s mission resides in reaching all kind of consumers and their ability to enjoy fashion regardless of their economic status.

as a part of Shein’s market strategy, they sell sexy and casual clothes for very cheap
Source: Shein Instagram page, as a part of Shein’s market strategy, they sell sexy and casual clothes at bargain prices

Its model image is also close to Instagram and Weibo internet celebrities, rather than Zara’s traditional fashion sense.

Middle East is an important region for Shein

Shein entered the Middle East in 2016, and its sales in the area shortly reached 200 million yuan that year. Currently, Shein ranks among the top ten shopping apps in the two main markets in the Middle East: UAE and Saudi Arabia.

In November 2021, Shein released its fall/winter menswear collection in the Middle East offering casual clothing staples for men at affordable pricing in line with its ideal that everyone should be able to enjoy fashion. In attempts to control over a new market, Shein Middle East offers the same shopping experience that they provide in the U.S. such as being able to pay with local currency, constant promo codes, and fast shipping.

Why Western Gen Z consumers prefer Shein over Amazon to buy clothes

Amazon for Western people is what Taobao and Tmall are for Chinese people. Over the years, Amazon has firmly occupied the top list of shopping sites visited by the American public. Amazon was the influential platform that taught Western consumers to shop online and built their shopping habits through data collection from search optimization. In turn, Shein decided to utilize this strategy and tap into its consumer base. However, according to a survey of 9,800 American teenagers with an average age of 15.8 years and an average family income of US$67,500,in 2020, Shein was the most popular online clothing store. As of May 2021, Shein surpassed Amazon with 17.5 million downloads emphasizing where Gen Z’s preference lies.

More young consumers are beginning to marvel at the low prices of SHEIN. For example, the price of a women’s T-shirt can be as low as 6 US dollars, and the price of a dress can be as low as 12 US dollars. 

Shein's assortment of clothing
Source: Shein’s assortment of clothing and bikinis at a price point beating any fast-fashion brand

One of the strategies of Shein is that it chooses less popular influencers in the West, rather than a more costly one. They post on Instagram, YouTube or TikTok and get free products delivered every month. Some of them can also get 10% to 20% commission from Shein’s referral sales.

Referral is indeed effective, as it helps to spread the awareness about the brand. According to Similar Web‘s traffic source statistics for the Shein.com site, in January 2022, 10% of the traffic can be directly traced to influencer recommendations (social and referrals), and 45% of the traffic comes from organic search. However, the proportion of direct access traffic exceeds 38%, which indicates a high proportion of returning customers. 

Shein Marketing Channels
Data Source: SimilarWeb, designed by daxue consulting, Shein traffic sources worldwide

Shein’s market strategy: Products and brands

Shein’s official website contains exclusive items selected by Shein stylists and created by designers specifically for the online store, as well as clothes, shoes, and accessories from brand partners. The catalog has convenient navigation for buyers. All products are divided into categories: Men, Women and Children; standard sizes and models Size +; seasonal collections; promotions and sales; fashion trends and style directions.

Shein has an incredibly wide range of products which makes shopping online fun. Consumers never know what they will encounter in the store, and each day goods in stock change. For young, price-oriented consumers do not require a long-lasting professional wardrobe, Shein’s product selection is perfect.

Shein’s market strategy: Hitting the target audience of Gen Z

Its target audience are price-driven customers who love online shopping from all over the world. The most common purchases on the website come from:

  • Gen Z consumers, mostly women
  • Parents of children from 1 to 15 years old

Since Gen Z is the most important target consumer group for Shein, its marketing strategy has to be desirable, unique, and socially acceptable for young people. This demographic represents a significant market segment but requires new marketing strategies.

Today, young people do not respond to the same marketing methods as the previous generations. For instance, 55% of Gen Z cite price as the most important factor when shopping for fashion emphasizing that they are extremely price sensitive. Shein has a wide and fragmented channel mix of website, app, social media, and a wide network of fashion influencers. Compared to other generations, Generation Z relies more on social media and targeted mobile advertising to discover fashion brands. Moreover, Shein’s account on Instagram promotes body positivity and self-love. For young consumers, this is key as well.

Aside from micro-influencers, Shein also collaborates with Western celebrities adored by young people, including but not limited to Katy Perry, Lil Nas X, Rita Ora, Nick Jonas, and Hailey Bieber who represented Shein in 2020.

Shein’s marketing strategy accelerated by COVID-19

During COVID-19, while most American fashion brands’ sales experienced a decline of 20%, the Chinese fashion brand’s sales continued to soar up to triple digits. The lockdown period also allowed many of Shein’s targeted consumers to spend more time browsing the web and shopping online. This was a perfect opportunity for consumers to become aware of brands which led to the steep rise of Shein. At one point in May 2020, Shein’s googles searches were higher than Zara’s searches. The development of digital technology during Covid-19 also allowed Shein to strategize its social media marketing strategies towards their target audience, Gen Z. Through the emerging popular platform, TikTok, Shein was able to connect and build a relationship with their young consumers.

Data Source: Google Trends, designed by daxue consulting, U.S. comparison of google index searches among Shein, Zara, and H&M from prior to COVID-19 to present day

Shein’s marketing strategy on Tiktok

Shein is the #1 brand for TikTok teens. Shopping purchases are driven by a constant stream of coupons and discount codes. TikTok users appreciate the large selection of inclusive sizing, ranging from XS to 4XL. On TikTok, Shein has created armies of fashion bloggers supporting the brand with haul videos of their purchases under the hashtag Shein. Influencers get free merchandise every month for their posts on TikTok. Others earn commissions on sales directed to Shein.com, above the average affiliate rates that other small stores cannot compete with. Many bloggers, influencers, and youtubers alike enjoy working with Shein due to the flat rate per video profit made rather than a “brand exclusivity” contract. This creates an easy and convenient working experience for both parties.

Shein's searches on Tiktok
Source: TikTok, Shein hashtag search results hits billions of views

Shein’s marketing strategy on YouTube

Like Primark, an Irish multinational fast fashion retailer, Shein has created an environment that allows shoppers to feel smart and savvy to find the perfect outfit in style. The sheer range of items sold through the store and the fact that not everything is always in stock create an almost gamified experience. Customers are happy to film themselves unpacking their clothes to try it on and show how they found these inexpensive goods. Sometimes, these products may not be the right size or look cheaper than they appear to be on the Internet, but this risk adds to the fun of a customer’s experience.

YouTube is one of the most popular social media channels selected by Shein to show consumers their products. The exchange model is one of their marketing strategies in which video bloggers and influencers are offered free products in exchange for creating content to promote Shein.

Shein’s marketing strategy: Affiliate program for influencers

Since Shein is a standalone brand and not a platform for sellers like Amazon, customers have the chance to be part of Shein’s affiliate program.

In affiliate programs, people earn commission on all recommended sales simply by referring customers to Shein.com. You can choose between Shein Official Affiliate and Partner Affiliate Platforms.

How influencers earn money from Shein:

  1. They promote SHEIN on social media
  2. A prospect clicks on the posts
  3. The client places an order
  4. The influencers receive commissions
Shein's hauls on Youtube
Source: Youtube, Shein targets influencers with benefits in exchange for hauls

Shein’s secret to success: Understanding the psychology of a new generation

The online apparel market is changing rapidly, and strategies must be constantly updated to beat competitors. Shein’s success demonstrates that its marketing strategy based on a sincere understanding of the new generation works well. In short, Shein adjusts to the needs of its consumers in every way.

Shein also beats its competitors with fast delivery and cheap prices. The company is becoming more and more vertically integrated with leading in-house developments. Average delivery time is 6-8 days. Processing usually takes 1-3 business days. It is also possible to choose premium delivery and receive the goods in 2-4 days.

Moreover, Shein actively supports an active community of like-minded shoppers through its channels. Their website and mobile stores include extensive expert reviews as well as a style gallery through which shoppers can share their clothes and tag products with their style sources.

Netizens’ criticism of Shein

However, Shein is also facing criticism from consumers. Lots of other customers have warned of frustration on the forums. For example, in Trust Pilot, 43% of people rate a brand as “bad”. In addition, there are many YouTube videos showing Shein’s clothes come in the wrong size or fit differently as seen from the photos. On social media, consumers brought product quality concerns with clothes falling apart and received with odd smells.

China market tactics that Shein applied in the West

As a Chinese company that has become wildly popular around the world, it’s no surprise that some Chinese market strategies have seeped into Shein’s global strategy. In a way, Shein helped test the waters for Chinese brands looking to expand abroad, to see what market strategies they can take abroad, and what won’t work. Here’s a look at what Shein market strategies worked and don’t work in the West.

What works:

  • Micro-influencer marketing. Shein’s influencer marketing strategy is similar to KOC marketing in China. This mutually beneficial partnership allows the brand to expose itself to new audiences with its fashionably, trendy clothes while giving many small influencers a chance to receive free clothes in exchange for their opinions and social media exposure.
  • Pricing. Shein’s pricing matches that of Taobao, which is lower than other fast fashion but is not available outside of China. Because of the price, Shein was able to expand quickly, making a large amount of each item, which thereby allowed the brand to produce in bulk and even further lowering costs.
  • Discounts. Similar to many Chinese brands in the domestic market, Shein frequently offers discounts. Discount for purchasing through an influencer, discount for downloading the app, and a portion of their website that offers rotating sales.
  • Social Media Presence. Shein has over 250 million followers on multiple social media platforms which contributes to its success allowing consumers to discover their brand and engage with audiences. Its digital social media presence is also highly connected to their influencer marketing strategy that targets younger shoppers and help builds its reputation through clothing hauls and reviews.

What sort of works:

  • Body positivity. there are still dedicated sections for plus sized clothes, and the brand has taken a stance on body positivity. However, at a time when many Western apparel brands are pledging to stop photoshopping models, Shein is using overly photoshopped images to fit unrealistic beauty standards. Shein’s large consumer base consists of younger teens which counteracts the progressive movement towards loving one’s own body and sets an impractical goal to look up to.
a Shein model with clearly photo shopped features. Shein's market strategy
Source: Screenshot posted by Reddit user, a Shein model with clearly photo shopped features.
  • Social responsibility. Despite Shein’s clear social responsibility statement on their website affirming that it does not use child labor, many consumers still feel that the brand is not being transparent about production outsourcing. Shein’s lack of transparency in speaking out against their workers’ rights and child labor undermines its’ social responsibility statement. As of September 2021, Shein published a supply transparency statement regarding forced and child labor. It has also implemented a recycling program for unwanted clothes and partaken in campus events. Its initiatives are meant to show consumers that they are aware of its actions as a company, however, no specific metrics or reports have ever been publicized.
  • Customer Data. In exchange for more discounts and bonus points, Shein encourages shoppers to provide their personal data. Shein collects data from customers using their social media apps and sites to track their shopping behavior, as well as customize their preferred clothes at lower costs than competitors. In 2018, data breaches in Shein’s Australian site by hackers affected 6.2 million people which led many consumers to become wary and distrustful.
  • On trend. Although this is quite linked to the use of customer data, Shein established a big data system to collect and analyze trends wanted through search optimization. In partnership with Google, Shein even has its own customized tool through Google Trends Finder to capture information about popular fashion items. In turn, this guides Shein’s production design, volume, and suppliers that makes Shein one of the largest-growing fast fashion brands in the West. One key feature of Shein’s marketing strategy is its ability to strategically use micro-trends as a form of appeal to younger price-sensitive consumers’ interest that quickly fades concealing the impact of their environmental footprints left behind.

What does not work:

  • Lack of cultural sensitivity. “Politically correct” means something else in the West than it does in China, and in the West, cultural appropriation belongs to the “politically incorrect” category. One major slip-up Shein made on this front was appropriating Muslim prayer mats to be ‘rugs’, which received angry backlash from consumers. On another instance, Shein was selling the Buddhist swastika sign on jewelry, however in Western cultures, the swastika is more closely related to anti-Semitism. Although the jewelry piece was made in the design of the Buddhist swastika, with the angle as the key difference, consumers can’t help but relate the symbol to the Nazi swastika.
  • Too many ads and notifications. A common complaint of Shein is that it sends to many notifications, and has too many ads within the app. This is a cultural difference between internet usage in the West vs. China – while Chinese prefer website that are busier and are less bothered by notifications, Westerners like clean-cut and simple websites like Google, and prefer less notifications and ads.
  • Trademark infringement.  Unlike other fast-fashion brands, Shein releases new products on a daily basis, with 20 times new items more compared to Zara and H&M. They are able to achieve this by drawing from smaller business and big corporations alike. Such behavior led many designers and brands, including Dr Martens and Levi Strauss, to sue the company for trademark infringement.

Author: Daiane Chen

This analysis of Shein’s market strategy in the west is a part of our 7 Continents initiative where we provide market research and consulting for Chinese brands in the west. Learn more about 7 Continents and find similar case studies here.


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