Photo suppliedLeslie Meredith
After months of testing, TikTok has launched its TikTok Shop feature to 150 million U.S. users, so now you can buy products directly from the wildly popular social media platform without leaving the app. TikTok Shop is a multipronged initiative offering an affiliate program and, in some cases, shipping items from its own logistics centers.
Sound familiar? It should — TikTok Shop is a miniature version of Amazon with products, an affiliate marketing program, fulfillment centers — and one big difference: a sophisticated algorithm that targets users with the content they want to see delivered by influencers and regular folk alike who have amassed loyal followers. TikTok said it hopes to move $20 billion worth of products worldwide this year. For comparison, Amazon posted $514 billion in net revenue in 2022. But we’re looking at an entire generation growing up with TikTok, so big growth is a real possibility.
Today, the shopping feature is limited but promising, with TikTok saying they had signed up more than 200,000 sellers on the Shop product and more than 100,000 creators for the affiliate program. We’ll take a look at Tiktok’s new offering, how to participate and see how the company is preparing for Black Friday, the biggest online retail event of the year.
Brands, merchants and creators can now access tools to sell directly through shoppable content on the TikTok app. You will see shoppable videos and LIVE streams in your For You feed, identified by a gray box that says “Shop” next to an orange and white shopping cart icon. In this box, you’ll often also see an offer: It appears that TikTok is underwriting 50% discounts off items to stimulate purchases. Note that this is different from the existing buy button that takes you to a retailer’s website to purchase a promoted product from a video.
A new Shop tab should soon be appearing at the top of your For You page next to the Following tab, which will take you directly to the new marketplace. You can also search for a product type or a specific product and then select the Shop tab from the scrolling menu at the top of your screen to visit the marketplace. If you do not yet see these options, make sure you have the latest version of the app and then be patient because features are still rolling out.
While brands and merchants can sell directly from their content, profile pages and the new TikTok marketplace, creators can participate in selling merchandise through TikTok’s new affiliate program. You may be familiar with Amazon’s affiliate program. Perhaps you’ve seen a disclaimer on a blog saying that the writer receives a small commission on products sold from the post. That writer had to apply to Amazon’s affiliate program and, once approved, can then use Amazon product links in their posts and get paid when a reader purchases from one of the links. TikTok’s program works in a similar way.
If you’re interested in participating, go to your TikTok profile page and tap the three lines in the upper right corner and then select “Creator tools.” Scroll down to find TikTok Shop for Creator. To apply for the program, you must be at least 18 years old and have more than 5,000 followers. Once approved, you can promote eligible products in your videos, LIVEs and showcase them on your profile. You’ll be paid a small commission based on the price of items when they are purchased from your content.
With the launch of Shop, the platform may collect more data from purchasers, but TikTok has emphasized “all TikTok-protected U.S. user data is stored in the U.S. and managed by USDS,” a reference to fears that data was being shared with the Chinese government.
Compared with Amazon, TikTok takes a smaller commission, about 5% versus 8% of merchandise sold on its platform. Sellers must follow TikTok guidelines or face possible expulsion. For instance, a seller has just three days to ship an order, which is why you won’t see any products available for pre-orders in the Shop.
To boost its online sales during Black Friday, TikTok will continue to fund discounts up to 50% to help it realize its sales goal for 2023. Black Friday promotions will start well before Thanksgiving on Oct. 27 and run through Cyber Monday.
Leslie Meredith has been writing about technology for more than a decade. As a mom of four, value, usefulness and online safety take priority. Have a question? Email Leslie at [email protected].
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