The Future of Social Commerce: Can TikTok Shop Compete with Amazon?

July 4th, 2023 by

For those familiar with the latest updates across social media, you’ll have noticed the increase in platforms adopting their own social commerce features. Think Facebook Shop, Instagram’s Shoppable Ads and, now, TikTok Shop. 

2022 shopping behaviours on TikTok reveal that 71.2% of users shopped after stumbling across something on their Feed and 58% used the platform for shopping inspiration. With TikTok’s social commerce features being so highly engaged with, the platform is now looking to expand. 

TikTok Shop social commerce

As a result of the popularity of the platform among users and brands, TikTok has begun planning the roll out of its own fulfilment centres across the US – and eventually the world. The move signifies TikTok’s commitment to e-commerce as its next major revenue stream following the explosive growth of its ads business. 

Through a recent job posting calling for a business solutions and merchant development manager, TikTok says, “By providing warehousing, delivery, and customer service returns, our mission is to help sellers improve their operational capability and efficiency, provide buyers a satisfying shopping experience and ensure fast and sustainable growth of TikTok Shop”. 

While the details are yet to be confirmed about TikTok’s latest endeavour, its application alone will pose a threat to companies like Amazon and Google who heavily rely on intent-based search advertising to drive business on their shopping platforms. 

As well as this, the implementation of TikTok fulfilment centres will provide small businesses with the opportunity to compete with the bigger players within their niches. These businesses will no longer have to invest extortionate amounts of their earnings into web development or outsourcing their own fulfilment centres. Instead, they will be able to hand the logistical reins over to TikTok and focus more of their efforts on boosting their social media presence and enhancing their community.

@basicbookz

#booktok made me buy it!! #bookrecommendations #bookrecs #archersvoice #thingswenevergotover #evelynhugo #hooklineandsinker #loveandotherwords

♬ All Your’n – Tyler Childers

The brands making an effort to enhance their online presence and strengthen their communities on TikTok are those more likely to see an increase in sales and benefit most from TikTok’s social commerce features. Users who feel seen and heard by brands are more likely to make purchases to prove their loyalty. With this, TikTok users are 1.4x more likely to purchase a product or service they discover in-app than users on any other platform. Good presence on TikTok leads to better discoverability which then leads to more purchases. 

Integrating social media with shopping not only creates a desired, seamless customer experience, but also provides us with a glimpse into the future of social commerce – a future that could result in TikTok being seen as a serious competitor to e-commerce giant, Amazon.

Our influencer marketing agency and social agency are located worldwide, with our agency network based in the USA, UK, UAE and China.

If you want to find industry insights, visit our influencer marketing and social media blogs here.

@ Socially Powerful

Posted in Industry Trends, Marketing News, Social Commerce