TikTok is considering introducing in-app shopping tools in Spain and Ireland as it continues to push in-stream shopping in an effort to increase revenue from its app.
TikTok is hoping to restart its shopping campaign in the EU after failing to accelerate in 2022, and launch a larger campaign into these two markets, Bloomberg reports.
According to Bloomberg:
” (tick-tock) The company has told partners, including retailers and creator agencies, in recent weeks to prepare for the debut of TikTok Shops in both countries, according to people familiar with the matter. It is also working to roll out the portal to other European territories next year, but the rollout will be smaller than initially envisioned.”
As previously mentioned, TikTok attempted to branch out from the UK in 2022 to make a bigger e-commerce push in Europe, but was forced to scale back that rollout due to internal conflicts.
According to reports, TikTok Harsh working conditions, The operation, modelled on its China operation, was poorly received among UK staff and ultimately led to a change in local management, which derailed the company’s wider e-commerce efforts, although lack of consumer interest also played a role in the decision to downsize.
But now, with in-app spending on the rise, TikTok sees new opportunities to connect with EU shoppers.
TikTok recently reported that it now has 15 million sellers on its app across markets, with the UK specifically being where TikTok is now the second-largest seller. Online beauty and health retailer.
So if TikTok gets things going, the opportunity is there, and the company is currently working to streamline processes and build in-app purchasing habits to expand its steadily growing market share.
However, the growth rate is not as fast as that recorded by TikTok’s Chinese sister app in its home country.
Douyin, the Chinese version of TikTok, is reported to have generated more than $300 billion in revenue in 2023. By comparison, TikTok generated $3.8 billion in revenue in the same period.
Moreover, Douyin’s revenues are growing rapidly and are expected to continue to do so for some time to come.
As you can see from this chart, Douyin’s revenue has grown from $5.8 billion in 2019 to $387 billion just four years later. Given TikTok’s current revenue is $3.8 billion, it’s easy to see why parent company ByteDance is hoping for growing opportunities, but at the same time, Western audiences are generally resistant to social media commerce and have not shown as much interest in making in-stream purchases as Asian users.
This is reflected in TikTok itself. in Singapore, Malaysia, Indonesia teeth Though the company has increasingly adopted shopping initiatives, it still appears to be a tough sell in markets outside Asia.
No one is sure why this is the case, but it seems that many Western consumers are not very interested in shopping within social apps, preferring to shop on dedicated shopping portals like Amazon.
As an example, TikTok recently launched its own“Great Deals” Event It was meant to compete with Amazon’s “Prime Day,” but it didn’t catch on.
As reported by ModernRetail:
“Across retailers other than Amazon, total U.S. volume growth during Amazon’s two-day Prime Day sale was up 3% year over year. In contrast, total volume growth during TikTok’s Deal for You Days event, which ran from July 9 to July 17, actually decreased 6%.“
Of course, in the United States, TikTok’s potential ties to the Chinese Communist Party could create backlash and concern among consumers, with the US government also imposing forced divestment legislation on the app.
This has likely made some users hesitant to upload payment information, but it will also extend to other Western countries where TikTok has come under scrutiny over its data-sharing and usage activities.
So it’s unlikely that TikTok will ever become an e-commerce powerhouse on the same level as Douyin, but it’s certainly going to try, and while I can’t imagine this will be a transformative change, there’s evidence that TikTok could have a bigger retail presence and greater brand recognition, at least in certain areas.
So will this new EU shopping push pay off in a big way? Probably not, but on the contrary, even smaller scale implementations could have big results.
