TikTok set to launch e-commerce business in US with Chinese goods

TikTok is set to launch an e-commerce business in the US to sell made-in-China goods to consumers.

 

The video-sharing platform will make the program available in its biggest market in early August, which will take on fellow US-based Chinese shopping platforms Shein and Temu.

 

TikTok's initiative is akin to Amazon's ‘Sold by Amazon’, and will manage storage, shipping, marketing, transactions, logistics, and after-sale services for manufacturers and merchants in China. 

This move comes as TikTok aims to quadruple the gross merchandise value to $20 billion globally this year. The platform is also building the TikTok Shop Shopping Center, integrating different channels for users to view and buy goods on a single page.  

However, they face challenges from regulators and competitors, including political uncertainty over its future in the U.S., where officials and lawmakers have branded the platform a national security risk. 

Conor McKenna, a partner at Luma Partners, an adtech-focused investment bank, noted that TikTok’s move not only rides the success of Shein and Temu, but also mirrors Amazon's upward trajectory.  

By leveraging its strength in consumer attention and influence, TikTok aims to directly drive commerce, similar to how Amazon used its shopping destination to boost awareness through ads. 

“This distinction sets TikTok apart, as they now have more control over the entire interaction, focusing on delivering a seamless user experience,” McKenna wrote on LinkedIn. 

“If TikTok successfully establishes trust and adoption, it will pave the way for further opportunities with third-party merchants." 

Additionally, TikTok is taking on Twitter by adding support for text posts, in a bid to expand beyond its dominant short-video market and give users more ways to express themselves, while also competing with other popular social platforms.

The new option allows creators to share stories, poems, lyrics, and other written content on the platform.