13.06.2023 | latest update: 07.09.2023 | by Lili
Launched on 4 May in the US, the global integrated marketplace by SHEIN was first introduced in Brazil in April 2023 and is scheduled for expansion all over the globe. Besides SHEIN’s own branded products, the marketplace is also open for local and global third party sellers in the fashion and beauty industry.
Screenshot of the homepage of us.shein.com
Besides a spot at the marketplace, SHEIN also promises to introduce its selling partners to its on-demand production capacities and provide resources for them to succeed in SHEIN’s business model.
According to Sky Xu, Chief Executive Officer of SHEIN, “By bringing new sellers onto SHEIN Marketplace that are aligned with our vision of making the beauty of fashion accessible to all, we are creating increased value for our customers while enabling local businesses to grow with us.”
Founded in 2008, SHEIN (originally ZZKKO) began as an online retailer of womenswear, especially wedding dresses. At first, the company merely aggregated products from Chinese manufacturers and sent them on to international customers.
Later, SHEIN became involved in the design and branding of its garments as well. Thanks to the boost the COVID-19 pandemic gave to e-Commerce, the company has quickly reached the frontline of fast fashion.
Today, SHEIN competes with global fast fashion companies like Zara and H&M, dropping about 2,000 new branded products every week to its marketplace.
Another major factor in SHEIN’s success is its ability to ride the waves of social media, targeting the users of popular platforms like TikTok, Instagram and YouTube. No wonder that the marketplace has adopted the tile format used by social media platforms, and offers frequent promotions to draw in customers.
Screenshot of random SHEIN listings on us.shein.com
Besides garments for women, men and children, the marketplace sells beauty products, sports accessories and beachwear.
SHEIN products are only available online, via SHEIN’s website or mobile app. The company is wildly successful: it reported a revenue of $30 billion in 2022, up from “only” $15.7 billion in 2021.
Currently, SHEIN is the second largest online fashion retailer with a €7,867 million turnover behind JD.com (€13,782 million), and followed by vip.com (€5,968 million) and zara.com (€5,859 million).
The SHEIN app was the most downloaded app in its category in 2022, and its user base grew from 43.7 to 74.3 million in only a year. The majority of its users come from India, Saudi Arabia, Mexico, Brazil and the US, but SHEIN is available almost all over the world. The company has offices and warehouses in several locations, with the most recent one opening in Dublin in May 2023.
Interestingly, SHEIN only focuses on international trade and doesn’t sell to customers in China.
When you think of fashion, the image in your mind is probably of a shiny shop full of glamorous products, and not that of a gigantic waste depot filled with discarded clothing. Unfortunately, the latter is the direct consequence of the former, especially when it comes to fast fashion and its younger siblings, ultra-fast fashion and real-time fashion.
Fast fashion companies like H&M and Zara are producing new clothing at an alarming rate. The consumption of garments has doubled since 2000 and now stands at 62 million tonnes per year - a figure projected to reach 102 million tonnes by 2023. The allure of fast fashion: trendy clothes at an affordable price.
Screenshot of random product listings on us.shein.com
Unfortunately, this increase is paired with a decrease in the lifetime of clothing: in general, a garment is worn for a 36% shorter time before being replaced by a new item. No wonder: trends change quickly, and since the quality of fast fashion clothing is often subpar, it makes more sense for consumers to throw out their outdated, damaged clothes and buy new ones.
Consequently, the amount of waste fast fashion produces is quickly rising (92 million tonnes per year!), not to mention the incredibly high environmental costs of production itself. This includes the excessive use and subsequent pollution of water as well as twice the amount of CO2 generated than by aviation and shipping combined.
And finally, let’s not forget about the poor working conditions. Fast fashion clothing is often produced in sweatshops, where people work for extremely low wages in unhealthy environments. Toxic chemicals are often used during production - and may even make their way into that cute little outfit you’ve bought at a bargain price.
It turns out that fast is not fast enough for the 21 century, thus ultra-fast and real-time fashion were born. Where fast-fashion companies drop about 12-20 collections per year and are mostly based in brick-and-mortar stores, ultra-fast fashion companies like Asos have moved online and present new collections on a weekly basis.
Then we have real-time fashion, spearheaded by SHEIN, where consumers can get new styles almost every day. And for the price they’re going at, why not?
Screenshot of us.shein.com/daily-new.html displaying new arrivals
Lately, with growing demand for a more sustainable global economy, fast fashion companies have tried jumping on the bandwagon of sustainability and eco-consciousness. Unfortunately, many of these fall into the category of greenwashing - trying to dupe customers into believing the company makes an effort to be more sustainable when in reality, they’re not doing much.
With its speed-of-light production rate and rapidly growing reach, SHEIN seems to be a significant contributor to the problems created by fast fashion. However, this is not the only issue with the marketplace.
+++ Update Summer 2023 +++
Human rights and climate activists in France have launched a campaign against SHEIN. They claim that the company’s business model encourages overconsumption while polluting the environment with microplastics. In addition, the activists are worried about the poor working conditions SHEIN provides for its textile workers.
The aim of the campaign is to create stricter regulatory measures regarding marketing and advertising of brands that promote overconsumption. Moreover, brands that release over 1,000 new items per day should be blocked or delisted. SHEIN releases up to 10,000 a day.
With the arrival of third party sellers on the platform, the number of IP infringements is expected to rise even more.
+++ Update Fall 2023 +++
Swedish fast-fashion retailer H&M has launched a lawsuit against SHEIN for copyright infringement. H&M claims that SHEIN copied and used several of its fashion designs without permission, including those for swimsuits, sweaters and shirts. Although the suit was filed back in 2021, it only became public knowledge after photos from the trial were leaked to the press in the summer of 2023.
The case could form a precedent for European fashion companies. As we mentioned above, several Western brands like Zara and Ralph Lauren have already raised the alarm about SHEIN for copying their designs, but H&M is the first large European fashion brand to take the Chinese retailer to court. The outcome of the case could become a milestone in the fight against copyright infringements by Chinese retailers in Europe.
Despite SHEIN’s copyright protection policy, it seems that brands may find counterfeited or lookalike versions of their products on the marketplace. Luckily, online brand protection is ready for the challenge.
Regardless of how fast SHEIN markets new products, globaleyez’s marketplace monitoring service detects potentially IP infringing listings in a heartbeat. Similarly, our image monitoring service finds stolen or copied images on the internet as well as social media platforms - a crucial place for SHEIN to draw in new customers.
With a test purchase, you can gather important information about the seller and the origin of the products, which is especially important when we’re dealing with an elusive third party seller.
Finally, we can enforce your rights and ensure the removal of the infringing content from circulation.
The problems inherent in fast fashion can’t be solved overnight: we need fair and global solutions for these serious overarching issues. Adapted consumption rates, increased recycling and more environmentally friendly production methods are indispensable to curb the social and environmental crisis caused by fast fashion.
Luckily, IP infringements in fast fashion are much easier to deal with. Reach out to us and let’s find the quickest and most efficient way to address the IP issues your brand faces!