TikTok Shop has gained even more traction since the president signed a law that may ban TikTok early next year. But if it goes away, Chinese e-commerce giants Temu and Shein could be the biggest winners.
Read the full story on Forbes: https://www.forbes.com/sites/alexandralevine/2024/06/25/bytedance-doubles-down-on-tiktok-shop-despite-threat-of-a-us-ban/
Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1
Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:
https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript
Stay Connected
Forbes newsletters: https://newsletters.editorial.forbes.com
Forbes on Facebook: http://fb.com/forbes
Forbes Video on Twitter: http://www.twitter.com/forbes
Forbes Video on Instagram: http://instagram.com/forbes
More From Forbes: http://forbes.com
Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.
Read the full story on Forbes: https://www.forbes.com/sites/alexandralevine/2024/06/25/bytedance-doubles-down-on-tiktok-shop-despite-threat-of-a-us-ban/
Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1
Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:
https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript
Stay Connected
Forbes newsletters: https://newsletters.editorial.forbes.com
Forbes on Facebook: http://fb.com/forbes
Forbes Video on Twitter: http://www.twitter.com/forbes
Forbes Video on Instagram: http://instagram.com/forbes
More From Forbes: http://forbes.com
Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.
Category
🤖
TechTranscript
00:00Today on Forbes, ByteDance doubles down on TikTok Shop, despite threat of U.S. ban.
00:08TikTok might be fighting for its life to be able to continue operating in the United States,
00:13but that hasn't stopped its China-based parent company ByteDance from betting on its newest growth machine, TikTok Shop.
00:21Since the law was passed that threatens to ban TikTok nationwide, TikTok Shop has grown rapidly.
00:27Data from Root, an app that millions of online shoppers use to track all their e-commerce purchases in one place,
00:33shows a 13% jump in orders from TikTok Shop from April to May,
00:38almost double the average monthly increase of 7% since the beginning of this year.
00:44And that's after TikTok Shop's first quarter of 2024 for Root customers beat out its last quarter of 2023,
00:50when holiday shopping almost always yields the strongest sales on the calendar.
00:56When TikTok Shop was introduced in the U.S. last September, it quickly became the Internet's new favorite dollar store,
01:02setting itself apart from American e-commerce rivals like Amazon by focusing less on common staples
01:08and more on cheap, often heavily discounted novelty items and funky special purpose products reflective of the Internet trend du jour.
01:17TikTok says it had more than half a million shop sellers in the U.S. at the end of 2023.
01:23By the beginning of 2024, it was gunning to grow shop tenfold in the U.S. to some $17.5 billion in sales per Bloomberg,
01:32making it a core part of TikTok's overall business that some estimate to be worth more than $100 billion.
01:39Creator agency founder Eric DeHaan, whose L.A.-based MightyJoy helps brands grow through influencer marketing on TikTok Shop,
01:47told Forbes that, quote,
01:54He noted that one positive indicator of Shop's success was that after TikTok initially covered the costs of steep discounts on many Shop products,
02:02which was a strategy that incentivized customers to buy and brands to join the platform in the first place,
02:08TikTok eased off those subsidies and started taking a bigger cut of merchant sales in April.
02:14He said, quote,
02:22Even after the divest or ban law passed in late April, ByteDance didn't slow down.
02:28Instead, it reportedly halted expansion of TikTok Shop in Europe in May to pour resources into tightening its grip on the American market.
02:36TikTok now appears to be hiring hundreds of employees in the U.S. to support those efforts,
02:41according to job listings for TikTok Shop posted on the company's career page and LinkedIn.
02:46They include TikTok Shop product managers, creator specialists, intellectual property experts,
02:52moderation or recommendation staffers and even personnel, quote,
02:56responsible for establishing and maintaining effective relationships with key regulators in the United States,
03:01and, quote, shaping TikTok Shop's approach to regulator engagement.
03:06Many of the open TikTok Shop job postings say, quote,
03:10The commerce industry has seen tremendous growth in recent years and has become a hotly contested space among leading Internet companies.
03:17Its future growth cannot be underestimated.
03:21Creators and others in the industry also began sensing that TikTok's algorithm was boosting posts that promoted TikTok Shop and throttling posts that did not.
03:30DeHaan said people were, quote,
03:32Suspecting that TikTok is artificially only rewarding shop content to encourage more people to post it.
03:38So it seems like it's a really concerted effort across TikTok to push shop aggressively.
03:44And he said, quote,
03:45Coupling that with people saying that they're seeing a lot more products in their feed than before.
03:50I think it's clear that they're very heavily invested in this.
03:54ByteDance's efforts appear to have paid off so far.
03:58The fact that TikTok Shop has largely gained momentum since President Biden signed the divest or ban bill shows just how little regulatory scrutiny has deterred the platform's popularity in the U.S.
04:10A ban isn't a foregone conclusion.
04:12TikTok could still be sold, though it's unlikely, or the company could successfully fight off the ban in court.
04:18A D.C. appeals court will hear arguments challenging the potential TikTok ban on September 16th.
04:25For full coverage, check out Alexandra S.
04:27Levine's piece on Forbes.com.
04:31This is Kieran Meadows from Forbes.
04:33Thanks for tuning in.