TikTok Shop has recently seen a surge in popularity in the US, especially in the realm of live streaming e-commerce. Record-breaking sales figures have been achieved, with influencers like @iamstormisteele and @simplymandys raking in over a million dollars in sales in a single live stream. The platform has also witnessed a significant increase in daily Gross Merchandise Volume (GMV) during promotional periods, with brands like 泡泡玛特 breaking the $100,000 mark in a single live stream.
Despite this apparent success, the TikTok Shop ecosystem in the US is facing a complex landscape. The platform’s future in the country remains uncertain due to ongoing regulatory challenges, but TikTok is actively investing in its e-commerce business in the hopes of solidifying its presence in the market and staying competitive amidst potential policy changes.
One of the key challenges for North American sellers on TikTok Shop is the fierce competition and the difficulty in achieving significant sales volumes. While top influencers are thriving, many brand stores struggle to reach GMVs of over $10,000 in a single live stream. The market may seem vibrant, but only a handful of sellers are able to scale up and turn a profit.
The TikTok Shop ecosystem in the US has undergone significant changes over the past year. Initially launched with a limited number of sellers and stringent entry requirements, the platform has gradually opened up to more sellers, including those from China. The criteria for store entry have been relaxed, allowing more international sellers to join the platform and expand their reach in the US market.
However, with the influx of new sellers, the market dynamics have shifted. Sellers are now facing challenges such as price wars, diminishing profit margins, and increased competition for influencer collaborations. The platform has also been implementing new policies, such as requiring a deposit from cross-border sellers and potentially discontinuing shipping subsidies, adding to the uncertainty for sellers.
While influencers have played a significant role in driving sales on TikTok Shop, there is a growing realization that relying solely on influencers may not be sustainable in the long run. Brands and sellers are finding it challenging to establish their own presence on the platform and generate significant sales through self-broadcasts or brand-led live streams. The limited pool of influencers in the US market and the reluctance of traditional celebrities to engage in e-commerce further complicate the situation.
Moreover, the geographical constraints of doing business on TikTok Shop pose additional challenges for sellers. The platform’s algorithmic unpredictability and the preference for locally-based content creators make it difficult for international sellers to gain traction. TikTok Shop seems to favor sellers with a local presence, emphasizing the importance of establishing a strong foothold in the US market for sustained success.
As TikTok Shop continues to evolve and expand its e-commerce offerings, sellers are cautiously navigating the uncertain terrain of social commerce. The platform’s growth potential is undeniable, but the inherent risks and policy uncertainties in the US market will shape the strategic decisions of cross-border sellers in the coming months. Only time will tell how the platform’s future unfolds, and sellers must adapt to the changing landscape to thrive in the competitive world of TikTok Shop.