Consumers are finding new ways to knock out their holiday gift shopping this season. And they don’t have to go far to do it — it’s the same place an increasing number of them are already spending their screen time.
TikTok Shop, the social media platform’s latest venture into e-commerce, only came on the scene in the U.S. in September, but it’s already proving to be a viable channel upon which to build brands and drive sales.
Capitalizing on the #TikTokMadeMeBuyIt trend, TikTok Shop has brands queueing up to take advantage of the platform’s built-in, actively engaged audience to create their own shoppable channels directly in the app.
For good reason. The platform’s lucrative, locked-in audience, ease of use and low barrier for entry combine to create an enticing opportunity for many brands, says Victor Lee, president of Advantage Unified Commerce (AUC), a unit of Advantage Solutions.
AUC, a digital agency that specializes in e-commerce, is a TikTok Shop partner and its teams have been working with brands to build a TikTok Shop presence since the marketplace launched. And they’ve had plenty to keep them busy.
“I believe in the premise of different and new, and I tell our clients every single time by not trying something, you’re subscribing to ‘We’re gonna stick with what we’ve always done,’” Lee says. “And we know how that story ends.”
Shoppers, meanwhile, are not doing what they’ve always done. TikTok is awash in Millennial and Gen Z consumers, and they’re increasingly turning to social media to research products and make purchases.
Nearly half of respondents ages 18 to 29 say they plan on buying some holiday gifts on social media apps, according to a recent Shopify-Gallup survey. Further, a whopping 86% of Gen Z shoppers say social media influences their shopping habits, according to an International Council of Shopping Centers report.
These shoppers have met their match with TikTok Shop. The platform’s users spend an average of 90 minutes per day on the app, and they’re more likely to interact with ads than users on other social media platforms, Lee says.
There’s a lot of buying going on. Some 55% of TikTok users have bought something from a brand after seeing their products on the app, and 50% of TikTok users have made a purchase after watching a TikTok Live. According to data from eMarketer’s Insider Intelligence, the platform is expected to have 33.3 million U.S. social buyers this year.
‘You get what you put into it’
Because TikTok Shop is integrated into the app, users are almost guaranteed to be exposed to the e-commerce platform and land on a brand TikTok Shop showcases or run into a TikTok Shop live stream. From there, all they need to do is make a couple of clicks and have products shipped directly to their doors.
“That back-end magic is important because as a consumer, any time there’s a barrier of entry, we give up,” Lee says. “TikTok basically did an experiment, found out it worked, and instead of sticking with the traditional, they embraced the new opportunity.”
Many brands are embracing it, too.
Some have a head start. Those that already have a Shopify site can hook seamlessly into TikTok Shop’s infrastructure to execute transactions. The cost and complexity for new brands to set up is minimal.
“Like most things, you get what you put into it,” says Cory Krehbiel, AUC’s associate director of business development. “TikTok is expecting brands they partner with to fully invest in Shops. If a brand is putting together a quality content strategy with diversified videos and livestreams and invests in their shop, they can expect to see amplified reach, accelerated sales, partnership growth, and build a loyal TikTok community.”
A strategic approach is required
The platform feature’s launch and fast ascent has Krehbiel and his team at AUC immersed.
“We’re TikTok Shop partners, and we know the platform inside and out,” he says. “And we envelop ourselves in each brand we work with. This starts with an audit of a brand’s category and its competitors, understanding tone and brand messaging.”
This upfront assessment is critical. Brands need to know their audience and whether their brand resonates with those who frequent TikTok. In other words, are TikTok users likely to spend money on their products?
Another key question to answer up front: Does a brand’s technology infrastructure support platform participation? If someone encounters a product on the platform and likes it, can they easily buy it?
That assessment shouldn’t take months, or even weeks or days. “We could probably assess many brands within minutes,” Lee says. “Our role is to make sure we understand what they’re trying to do, and ask, ‘Will this tactic be effective for their brand?’”
If the answer is yes, AUC gets to work, handling TikTok Shop onboarding and brand and product setup, page design, shop management and back-end operational support.
From there, the agency develops a content strategy, which often includes creative development, video production, live operations, influencer identification, contract negotiation, recruitment, training and unified analytics to measure consumer engagement in content, traffic, shop activity, conversion to buy, SKU sales patterns and customer reviews.
“Once the content is created, we tailor a full-funnel media plan that includes the optimal mix of video shopping, catalog listing and live shopping ads — all designed with the goal to drive conversions,” Krehbiel says.
Further, he says, outside of a few categories such as fresh foods and alcoholic beverages, brands of all sizes and types can leverage the TikTok Shop platform.
Influencers are increasingly powerful on the platform, and while retailers don’t have to employ an influencer marketing strategy to fully leverage TikTok Shop, it can certainly help them to gain traction and put their products in front of a receptive audience.
“Users build trust with the influencers they follow, allowing brands to generate invaluable user-generated content (UGC), easily showcase product usage and then convert to sales,” Krehbiel says.
To TikTok or not to TikTok?
While there’s a clear upside and plenty of blue sky ahead for the platform, deciding whether to jump in head first is not a no-brainer. Lee warns brands looking at TikTok Shop as a magic bullet for retail, omnicommerce, digital or social shopping success to not get “blinded by trends.”
While some sellers have flourished in the platform’s early days, not all brands can expect to see the same significant returns, simply because the products they sell may not yet be suitable for TikTok Shop or its audience.
Succeeding on the platform also requires time and attention. Brands that want to succeed must actively promote their shops to consumers. TikTok is a content-driven channel, and the content machine needs to be fed.
Whether a brand is creating all its content in-house, using TikTok’s affiliate program or working with an agency to build an influencer strategy, content is king, Krehbiel says. “It’s not a prerequisite, but TikTok recommends posting 20 videos and five live streams each month.”
That can be a heavy lift for brands without a proper budget or agency support.
Big brands also may be at a slight disadvantage because they’re less likely than their smaller, nimbler counterparts to be on Shopify. Legacy brands often have significant, homegrown direct-to-consumer infrastructure that doesn’t allow for an easy back-end API hookup. Further, legacy retailers are often more conscious of their brand integrity.
They also must consider all of the data within their existing systems. “If you move suddenly, you could lose a lot of that legacy data, which reveals a treasure trove of information on consumer behavior,” Lee says. “Instead, I would ask them to pivot a little bit.”
And not just pivot, experiment.
Lee says a legacy brand should not be afraid to try something new because there are ways to experiment safely. And it starts by asking the right questions.
These questions can take time to answer, Lee says. But in the end, standing still without a presence on the platform could prove to be a mistake as progress and innovation often go hand-in-hand with risk.
He urges brands to do their due diligence, and if things pan out, consider an experiment. But they should do it quickly before the next new thing comes around — and they don’t have to go all in when they do, which makes it less risky if it doesn’t pan out.
“The battleground in retail marketing is about attention and conviction, how do I get it and how can I convince you to do something,” Lee says. “There will always be something new and shiny every 12 months or so, it’s human nature in this digital age. The key is to move quickly, efficiently and pivot based on outcomes. If you deliberate too much internally, the next big thing will have come and gone, and you’re back at square one for the next hot trend.”