TikTok planning to rival Amazon with major U.S. expansion

TikTok is reportedly planning to rival Amazon by growing its U.S. ecommerce business, TikTok Shop, tenfold to $17.5 billion this year.

Why we care. TikTok Shop is a prime opportunity for brands as 83% of users make purchase decisions on the platform. If TikTok is planning a major expansion, marketers will benefit from being able to showcase their products to a larger engaged audience in the States, maximizing ROI.

The details. TikTok is preparing to utilize its engaged user base and viral videos to boost merchandise sales on the U.S. TikTok Shop, reports Bloomberg. Although the details of this strategy were recently discussed during internal meetings, it’s important to note that these plans might change depending on the business’s performance.

However, if everything goes as planned, TikTok will pose a challenge not only to Amazon but also to online retail media brands like Temu and Shein.

Why now? TikTok was reportedly on the path to generating approximately $20 billion in global gross merchandise value – although the platform has denied this figure – with the majority of sales coming from Southeast Asia last year. The company is eyeing an expansion of its sales footprint in the U.S. and Latin America. According to two individuals familiar with the matter, TikTok is gearing up to launch its ecommerce operations in these regions in the upcoming months.

What is TikTok Shop? TikTok Shop allows users to make purchases while scrolling through a continuous stream of short videos and live streams within the main social media app. This feature enables both merchants and creators to display and sell products, creating a seamless in-app experience for the TikTok community to explore and buy directly.

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Deep dive. Visit the TikTok Shop Help Center for more information.

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