Cross-border e-commerce ignites a "new battle"

Author | Huang Yu

Editor | Zhou Zhiyu

If we were to find a keyword for the cross-border e-commerce industry over the past year, "crossing the calamity" might be the most fitting.

The repeated changes in tariff policies, the continuous tightening of overseas regulations, and the accelerated penetration of generative AI have intertwined to reshape the underlying logic of the industry's operation almost simultaneously. Cross-border e-commerce platforms, which once rapidly expanded by relying on low prices, direct mail small packages, and traffic dividends, have been forced to hit the brakes and reassess the sustainability of their models.

The cross-border e-commerce sector, once seen as a "money-making" track, has entered a hardcore competition phase, evolving from an "efficiency story" to "compliance stories," "localization stories," and "branding stories."

As one of the "Four Little Dragons of Chinese Cross-Border E-Commerce" (TEMU, SHEIN, AliExpress, TikTok Shop), AliExpress has positioned "brand going global" as its most important strategy today. After directly declaring war on Amazon last year, AliExpress recently launched its first large-scale recruitment event for brand merchants in the new year, clearly defining "brand going global + overseas management" as the core keywords for 2026.

The Four Little Dragons of Chinese cross-border e-commerce have almost simultaneously entered a strategic adjustment period over the past year. From the "full management myth" to the "return to semi-management," and from price wars to value wars, cross-border e-commerce is completing a collective "crossing the calamity." This reshuffle will determine not only the survival of platforms but also the future methods of Chinese manufacturing and Chinese brands going global.

Focusing on the "Value War"

As the elder brother among cross-border e-commerce platforms, AliExpress was relatively low-key during the industry's explosive growth in the past two years. However, last year, AliExpress suddenly became the one making headlines, upgrading its brand going global strategy from "hundred billion subsidies for brands going global" to the "super brand going global plan," while directly challenging Amazon.

The "super brand going global plan" promoted by AliExpress clearly states: "Let merchants achieve higher transactions in key markets at half the cost of Amazon."

On this path, AliExpress remains determined. According to Wall Street News, after holding its first recruitment meeting on January 7, AliExpress's new round of recruitment conference will be held on January 22 in Shenzhen, focusing on recruiting merchants with brand strength or those capable of deep localization.

TEMU, under PDD, also emphasized the importance of brand going global at the end of the year. PDD's co-chairman and co-CEO Zhao Jiazhen stated that in the next phase, TEMU will go all in on the high-quality, branded Chinese supply chain to achieve platform reconstruction.

Looking back over the past year, the most significant change among cross-border e-commerce platforms has been the collective "correction" of existing models.

According to Wall Street News, to cope with policy risks and enhance risk resistance, the four major cross-border e-commerce platforms in China have taken measures to diversify operational regions, improve operational strategies, promote semi-management models, and increase overseas warehouse fulfillment methods The cancellation of the small package tax exemption policy in the United States and other regions undoubtedly brought significant impacts to cross-border e-commerce platforms last year. The small package tax exemption policy was once a booster for the rapid expansion of cross-border e-commerce. Platforms relying on direct mail small packages, such as TEMU and SHEIN, experienced a golden period of rapid expansion in the United States.

Data shows that from 2015 to 2024, the application volume for "small exemption" goods in the United States surged from 139 million to 1.4 billion.

However, since 2024, countries such as the United States, the European Union, the United Kingdom, Japan, Vietnam, and Brazil have either canceled or proposed to cancel the small package tax exemption policy.

Typically, those relying on direct mail small packages operate under a fully managed model. TEMU, regarded as a "dark horse" in cross-border e-commerce, has become a hotbed for a vast number of new and old Chinese cross-border players seeking gold, and its creation of the "fully managed model" has swept through like a hurricane, becoming the hottest topic in the cross-border e-commerce industry in 2023. Following in TEMU's footsteps, AliExpress, SHEIN, and TikTok Shop quickly launched their own fully managed models.

Now facing challenges related to tariffs and compliance, the fully managed model, once seen as a tool for efficiency and scale, has been the first to encounter challenges, moving to a "marginal position" in the strategies of major platforms. AliExpress, TEMU, and SHEIN have shifted their focus to semi-managed or overseas managed models.

It is reported that after AliExpress launched its semi-managed model providing logistics and warehousing services in 2024, it quickly ramped up its "overseas managed" model. Under this model, merchants only need to connect their overseas warehouse products, while the platform handles marketing promotion, user operations, and local fulfillment, which is also seen as an important service model for localized operational management.

With changes in the external environment, localization has become key to global e-commerce competition. Based on this, AliExpress officially listed "overseas management" as one of the core keys for merchants going overseas last year, with another key being "brand going overseas."

Currently, AliExpress's overseas management has covered more than 30 key markets globally, including Europe, North America, Asia-Pacific, and Latin America. Starting from January 2026, AliExpress will upgrade its overseas management by dividing Europe into three major operational zones to further enhance localized services. In addition, AliExpress will expand its official logistics and warehousing capabilities in Europe, continuing to strengthen the "fulfillment certainty" user experience.

Industry Landscape Reshaping

To enhance "localization," in addition to ramping up the operational model for merchants stocking overseas local warehouses, these cross-border e-commerce platforms have also increased their efforts to attract local overseas merchants, which will undoubtedly further intensify the impact on overseas e-commerce giants like Amazon.

According to Wall Street News, last year, AliExpress actively recruited local merchants in markets such as the United States, Germany, and Poland, while TEMU's "local seller program" has also been launched in multiple countries, including the United States, Mexico, the United Kingdom, Germany, France, Italy, the Netherlands, Spain, and Japan.

It is worth mentioning that in November last year, TEMU intensively signed memorandums of cooperation with postal groups in countries such as France, Italy, and Austria in Europe. This move is also seen as an important part of TEMU's efforts to enhance localization CICC research analysts pointed out that if e-commerce platforms want to grow into local leading platforms, localization is a must. Against this backdrop, leading cross-border e-commerce platforms have begun to systematically promote localization.

Based on the proactive strategic adjustments of cross-border e-commerce platforms and the growth potential of the global e-commerce market, leading cross-border e-commerce platforms have still shown growth resilience despite headwinds from tariffs and regulatory policies.

According to CICC research forecasts, China's outbound e-commerce GMV is expected to grow by 12% year-on-year in 2025, higher than the 11% year-on-year growth rate of China's e-commerce GMV, and ahead of the global e-commerce GMV year-on-year growth rate of about 8%. The main drivers are the four major Chinese outbound platforms, including TEMU, which are expected to maintain a year-on-year GMV growth rate of 25% in 2025, surpassing the industry average.

TEMU has also proven with its performance that last year's "black swan" did not hinder its global expansion pace. At the PDD shareholder meeting at the end of last year, PDD's management revealed that TEMU took only three years to achieve nearly a decade's worth of growth that PDD's domestic main site experienced. This means that TEMU's scale is already close to that of the domestic main site.

Analysts from First Shanghai Securities also pointed out that TEMU showed positive growth momentum in the third quarter of 2025. Following a good performance in the second quarter, the third quarter GMV growth rate turned positive from negative, with revenue entering a healthy growth channel, while the pace of narrowing losses is expected to accelerate.

AliExpress's brand strategy upgrade last year was also an important turning point for its deepening of "brand going global." Over the past year, AliExpress has become a new main stage for brands going global. During the overseas Double 11 and "Black Friday" in 2025, over 300 brands on AliExpress achieved daily sales that were more than twice that of Amazon, with the total sales of brands reaching one million dollars growing by 80% year-on-year.

According to Sensor Tower data, during the "Black Friday" period in 2025, AliExpress's downloads in Europe once surpassed those of Amazon.

However, although AliExpress has gone through a year of "high-profile" operations, in terms of GMV growth, TikTok Shop among the "four little dragons of Chinese cross-border e-commerce" seems to have achieved more impressive results.

According to Wall Street Insights, ByteDance recently released information stating that in 2025, TikTok Shop's GMV is expected to approach $100 billion, ranking fifth among mainstream overseas e-commerce platforms, just behind Amazon, Walmart, Shopee, and eBay, with the highest growth rate.

With the changing global trade situation, there is a consensus that cross-border e-commerce will inevitably shift from growth at all costs to a focus on profitable growth, transitioning from simple "low-price exports" to a "branding" high-value-added strategy.

In this context, going global is transitioning from the "selling goods era" to the "branding era."

Looking ahead, cross-border e-commerce is still in a huge but more complex market. The challenges lie in policy uncertainty, rising compliance costs, and increasing localization investments; the opportunities lie in the fact that global consumers' demand for high cost-effectiveness and diverse supply has not disappeared, but their understanding of "cheap" is upgrading.

In this sense, 2025 may not be the most bustling year for cross-border e-commerce, but it is likely to be a year that determines the long-term landscape of the industry. Having gone through the "year of tribulation," Chinese cross-border e-commerce is transitioning from a speed competition to a true endurance race