TikTok aims to quadruple the size of its global e-commerce business this year and will soon launch its own U.S. e-commerce store. The platform is also leveraging new search capabilities to become a retail e-commerce hub, powering new AI advertising tools, and being involved in a number of new media ventures. Here’s what the platform has been doing over the past month:
e-commerce ambitions
TikTok plans to generate $20 billion in sales through TikTok shops this year. In addition to facilitating live e-commerce and incentivizing retailers through free listings and shipping, the platform plans to launch a fully independent online retail store in the United States. The store will exist within the app separately from the TikTok Shop and will likely compete with Amazon, Shein and Temu.
Analyst Susie David Kanian said on the podcast “Behind the Numbers: Reimaging Retail” that the store could present challenges in logistics and customer experience. “I’m actually a little surprised that TikTok is moving from a social platform that allows in-store sales to a physical retail store. The biggest difference is that TikTok will also own the logistics and inventory. It’s from.”
search news
TikTok is testing a visual search feature that allows users to purchase products by uploading images. Considering TikTok Shop hasn’t become the product search engine some people hoped it would, the feature could give TikTok Shop a much-needed boost.
According to CivicScience, only 3% of U.S. adults initiate product searches on TikTok, down from 5% last year. In contrast, 49% start their searches on Amazon and 34% start their searches on Google. Even Gen Z’s use of the platform to search for products has dropped from 18% last year to 11%.
AI innovation
Last month, TikTok launched an AI ad script generator that could increase the efficiency of ad creation on the platform. AI-generated content means the potential for misinformation and unwanted deviations from brand voice. Additionally, this technology can generate a large number of similar AI-generated ads. Still, the AI marketing tools integrated within the platform present an opportunity for marketers to ponder what AI in advertising might look like in the next few years.
creator update
Last month, TikTok launched “Creative Challenges,” where brands can submit challenges or crowdsource ads from creators. This is a smart move for advertisers and reduces the effort involved in creator-driven advertising. But performance-based payment models can hurt creators in the long run. That said, facilitating creator-sponsor relationships ultimately keeps creators on TikTok.
TikTok has announced a partnership with Gas Station TV to bring TikTok content to the network’s out-of-home (OOH) viewers. Instead of scrolling through his TikTok on mobile at the pump, consumers will see his TikTok content on screen alongside Gas Station TV creators and ads. The partnership will allow TikTok to enter OOH advertising and attract more potential users.
TikTok’s parent company, ByteDance, is capitalizing on the popularity of #BookTok to get into book publishing. With so many users discovering their next book through his TikTok, the platform has found a way to leverage the book itself.
TikTok has surpassed $1 billion in consumer app spending, something no app has ever done before. A large part of this spending is due to her one-time in-app purchase of TikTok coins that can be gifted to creators.
TikTok has entered the music streaming game in Brazil and Indonesia, offering yet another type of media that TikTok aims to take over. In the U.S., music could be an opportunity for him on TikTok, where our projections suggest that ad spend on digital audio services will total $6.79 billion this year.
TikTok has removed BeReal clones. TikTok wants to be in everything, but it still hasn’t been able to keep the BeReal copycat alive.
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