Photo credit: antonbe
According to reports, TikTok could launch an online retail store in the United States as early as next month.
The e-commerce store would sell goods from China and allow the company to compete in the e-commerce segment. Amazon, Shein and Temu would be the biggest competitors for the redesigned “TikTok Shop”. The report of traffic lights suggests TikTok’s store will sell kitchen appliances, toys, and other household items. These items would appear on the “TikTok Shop” tab that currently exists in the app, where companies pay a commission to sell their products to TikTok’s user base.
TikTok’s opportunities to break into the e-commerce market in the US are still evolving. The TikTok Shop launched in November 2022, but the platform has yet to gain significant traction. TikTok is also experimenting with what it’s calling “Trendy Beat” in the UK. Products are sold and shipped from a Singapore based company owned by ByteDance. TechCrunch spotted A trademark application for the US Trendy Beat feature, so it is likely an extension of the UK test.
E-commerce has been hugely successful for TikTok in Asia, where the industry as a whole is growing astronomically. Southeast Asia in particular is a hot spot for the company. TikTok is aiming to quadruple the size of its e-commerce company to $20 billion in gross merchandise value by 2023 $4.4 billion in sales last year.
“It’s very, very difficult to get European or North American consumers to buy on these social networks,” said Forrester Research analyst Sucharita Kodali told Yahoo Finance. “It’s just not the way we shop, it’s maybe a little bit the way we discover, but that’s not how we shop.”
The e-commerce market in the United States is already well saturated with established players. Even brick-and-mortar retail giant Walmart struggled to get its e-commerce business off the ground after Amazon had dominated the landscape for so long. This required buying an e-commerce retailer and adapting its store to Walmart’s needs. It’s also difficult to persuade consumers to buy items from an untested store – especially when it comes to items they can get elsewhere. TikTok faces a major challenge in these markets, particularly due to its regulatory scrutiny.