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TikTok aims for 10x surge in-stream shopping

TikTok sets sights on a tenfold increase in U.S. e-commerce, exploring innovative strategies for a breakthrough year in 2024

TikTok aims for 10x surge in in-stream commerce spending

The year of TikTok commerce

As TikTok navigates its path to e-commerce success in 2024, the big question remains – can it finally captivate Western consumers with its in-stream shopping options? The apps foray into in-app sales follows its success in China, where Douyin, the local version, thrives on in-stream purchases, a model TikTok aspires to replicate globally.

TikTok aims for 10x surge in in-stream commerce spending

Expansion goals

Reports indicate TikTok’s ambition to skyrocket its U.S. e-commerce business, targeting a tenfold growth to reach up to $17.5 billion in 2024. The challenge lies in how TikTok will achieve this substantial expansion, especially considering Western audiences’ historical reluctance towards in-stream shopping.

In-stream shopping challenges

In China, Douyin’s in-app shopping is predominantly driven by live streams, a trend that hasn’t gained the same momentum among Western users. Whether attributed to concerns around TikTok’s Chinese ownership or a general hesitation towards live-stream impulse buying, the social media company faces hurdles in replicating its Chinese success.

Despite challenges, they see promise in user spending within the app. In 2023, users spent $3.8 billion, marking a 15% YoY increase. While U.S. users primarily invested in Coins for virtual gifts, the willingness to spend in-app signals an opportunity for the platform to diversify its revenue streams.

TikTok aims for 10x surge in in-stream commerce spending

To boost in-app spending, the app may consider incorporating food delivery, drawing inspiration from Douyin’s success. Douyin’s expansion into local services, propelled by a content feed featuring local businesses, could serve as a model for the app’s broader utility and revenue expansion.

In its quest for commerce success, TikTok may emulate the strategy of Chinese retailer Temu, enticing consumers with lower-than-cost deals and fostering the thrill of budget-friendly shopping. This approach aligns with its mission to convert user engagement into revenue, not only for the platform but also for its creators.

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