On Sept. 12, Tiktok officially rolled out a new e-commerce business after months of programming and testing. This site will include many different businesses uploaded by users and catered to customers based on their online presence interests. It is open to everyone to use and share, and is activating a new system of revenue.
“The app seeks to replicate the success of other popular China-founded shopping platforms Shein and Temu,” says the Wall Street Journal.
This rollout is similar to what Asian-based apps have done time and time again. WeChat is the Chinese company that created the “everything app.” The “everything app” is intended to be a site where users can not only get entertainment, but shop, book appointments, text and complete mobile payment. This is the very app that Elon Musk had been attempting to create with his “X” project.
Tiktok also wants to monetize the site to a far higher degree. This app is seeing a lot of changes from becoming solely an entertainment app to a place where users can create stores for their products and buy products through the “For You” page.
When “influencers” or regular TikTok creators post about a product they like to use, it can be difficult to identify whether or not the videos about products are ads or genuine appreciation.
There are federal laws in place that restrict people on social media from posting without mentioning that it is an ad or product. However, this is hard to regulate because TikTok isn’t an American company and their shops are still very new to the site, so the app hasn’t been flagged for this issue yet.
TikTok is an app that can get away with this project for many reasons. There are over a billion users on the site, from young children to far older people. The app’s “For You” page is directly linked to each user’s personal interests. This opens up many different opportunities for monetization.
The app can also offer users items and products that would be catered to that person based on their own preferences. This is done with the goal of creating a unique social media app that, with the shop, becomes a network. The user-centered algorithm gives developers a leg-up in knowing the products to place on which users feed.
According to the New York Times, “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.”
Their intention at the moment is to acquire more customers to make purchases using this platform. Offering high discounts and coupons often for first time customers gives them an opportunity to test off the service. Even for TikTok content creators, a first time customer’s purchase is nearly free as long as a video is created on that product for their page. This is intended to bring more attention to a product and to use videos as a product review and advertisement.
Nico Le Bourgeois, an executive for the TikTok app, says, “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.”
These intentions for TikTok have been on the way for a while. TikTok Shop users are still adjusting to this new feature. Since the app’s goal is to keep users on the app, satisfying the user’s needs appears to be their priority.
