The Risk and Opportunity with TikTok Shop

Despite a recent ban in Indonesia, TikTok Shop is likely only going to grow in importance for marketers, especially in high volume categories. Indeed, it looks like it will soon be back in South East Asia’s largest economy as it applies for an e-commerce license. But what’s important here for marketers?

QVC vs Amazon

Amanda Mull in The Atlantic (paywall) says that TikTok Shop encourages TikTokers: “not just to share recommendations but also to more pointedly hawk products, pushing people’s feeds even further toward a low-rent, Gen Z version of QVC”, but is that the intention?

As she writes, this means FYPs are, “clogged with commission-generating sales pitches, listings for potentially counterfeit versions of popular products, and the kind of dirt-cheap plastic doodads that you’ll also see on bargain-basement retailers such as Wish, Temu, and AliExpress.” The counter-point is that those bargain-basement retailers are huge businesses, so there’s nothing wrong with that, it’s just that TikTok Shop would - I assume - rather be the Gen Z version of Amazon.

Standing Out is More Important than Ever

TikTok recently started testing an ad-free version of the app, almost in parallel - and surely not coincidentally - to the launch of TikTok Shop. And there has been a deluge of brands directly selling their products in the feed as they take advantage of this huge opportunity.

On the one hand, this is a new opportunity for brands to sell their products. On the other hand, it means the standard of social commerce content needs to be even better because people can pay to remove it - and other ad content - from their feeds.

In summary?

Brands will need to decide if it’s the right environment for their products as the platform continues to evolve because - as always - context is key.