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TikTok Popularizes Products. Can It Sell Them, Too?
The company is beginning to introduce TikTok Shop to all of the app’s users in the U.S., hoping to add a major new revenue stream.
TikTok wooed marketers from companies like Madewell, H&M and Gucci last Wednesday as part of New York Fashion Week, transforming the stylish East Village restaurant Cathédrale with a video wall showcasing fashion trends like “little luxuries” and tall mannequins wearing TikTok-inspired styles.
TikTok has cemented itself as an essential advertising venue for brands aiming to reach its young users. But at the party, the marketers were abuzz about TikTok’s efforts to sell products from the app itself.
The reason: After nearly a year of testing, speculation and some internal upheaval, TikTok this week is rolling out TikTok Shop for all users in the United States. The company will expand the rollout of a Shop button on the app’s home screen, which sends people to a marketplace, and drive traffic to videos that contain Shop buttons for specific products. Both enable users to buy products in a few clicks without leaving the app.
E-commerce is a significant bet for the company, which is hoping to translate the app’s power as a cultural trendsetter into another big new revenue stream. But it is a venture that other popular social platforms, including Instagram, have not succeeded with in the United States.
To make it a hit, TikTok said, it is actively driving videos with shopping buttons into users’ feed. The company is also, for the time being, giving generous discounts and coupons to users who shop and forgoing commissions from many sellers. TikTok said that it had already signed up 200,000 sellers to TikTok Shop and that more than 100,000 creators could make videos and livestream with shopping buttons.
“We have a very aggressive plan to make a splash in the industry and make sure that people out there understand that TikTok is a place for shopping,” Nico Le Bourgeois, one of two executives overseeing TikTok Shop in the United States, said in an interview last week. “We’ll be very present for Black Friday and Cyber Monday through a combination of traffic, free shipping and deals.” He also said TikTok Shop would run ads on the web and elsewhere.
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