By Arriana McLymore and Sheila Dang
NEW YORK (Reuters) – U.S. TikTok users have spent heavily on merchandise from various vendors on e-commerce platform TikTok Shop so far this holiday shopping season, according to TikTok estimates and a Reuters analysis of spending habits measured by Facteus data. .
Trends show that TikTok Shop, launched in the United States in September 2023, has likely gained e-commerce market share at a critical time. TikTok Shop serves as an e-commerce channel for major brands such as elf Cosmetics, Ninja Kitchen, among other products.
TikTok Shop said in a press release in late November that its sales reached $100 million on Black Friday, the day after Thanksgiving, when bargain-seeking U.S. consumers spent heavily online. Previously, it reported that the number of people purchasing products on TikTok Shop each month had almost tripled. Reuters could not independently verify his claims.
A US federal appeals court on Friday upheld a law requiring Chinese company ByteDance to divest TikTok to the United States by early next year, or face a ban. A ban on the popular short video app, if it happens, could also extend to the TikTok Shop.
“TikTok Shop is a new distribution channel and brands are doing very well with it,” said Erik Huberman, CEO of marketing agency Hawke Media, which has clients selling products through the feature. “Honestly, there is no alternative. It will be a waste of revenue.”
Like rivals Shein and Temu, TikTok Shop features products from third-party suppliers, some of which ship items from China, competing fiercely on price. Each of the platforms has attempted to attract more U.S. sellers with lower fees to improve shipping speeds.
Capitalizing on the popularity of the social media app TikTok, TikTok Shop merchants typically use ads and sponsored “influencers” to market their products to TikTok's 170 million U.S. users.
TikTok Shop merchants fulfill buyers' orders directly, sometimes using third parties or TikTok's e-commerce fulfillment services.
For shoppers like Jasmine Whaley, 31, of York, Pennsylvania, TikTok Shop has provided a new place to find clothing, skin care products and Crocs (NASDAQ:). She spent nearly $700 on the platform this year after seeing videos from influencers and advertisers about products.
TikTok has “cracked the code” when it comes to curating content and products it likes, Whaley said. Her orders from the TikTok store are often delivered to her faster than the orders she places on Amazon (NASDAQ:), she said.
For merchants and influencers, TikTok Shop offers what it calls “LIVE,” live video streams from which shoppers can purchase merchandise directly.
Nico Le Bourgeois, head of TikTok Shop's U.S. operations, said in a statement to Reuters that the number of live sessions held monthly had almost tripled over the past year in the United States.
According to third-party data firm Facteus, U.S. spending on TikTok Shop exceeded spending on Shein and Temu in the seven days leading up to Cyber Monday, Dec. 2, a day of intense online shopping. Facteus said its data comes from 140 million debit and credit cards, representing 7% to 10% of all U.S. spending.
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