TikTok to Expand E-commerce in More Countries Amid US Business Uncertainty
ByteDance-owned TikTok is gearing up to broaden its e-commerce footprint, with plans to launch in Italy, Germany, and France, and further expand into Japan and Brazil this year. The popular short video platform's in-app retail feature, TikTok Shop, is reaching out to Chinese sellers to establish stores in these new markets. Merchants targeting Italy are expected to have their stores up and running by the end of this month, while the launch dates for Germany and France remain uncertain.
The platform's distinctive "yellow shopping cart" icon, set to be activated in late March or early April in Italy, symbolizes TikTok's social commerce strategy. This approach involves marketing items for sale through content, with influencers curating and promoting products in various markets where TikTok Shop operates. The launch of TikTok Shop in Japan is anticipated in June, with the exact date for Brazil still pending.
TikTok, headquartered in Singapore and Los Angeles, has not yet commented on these developments. The platform's expansion into new territories underscores ByteDance's unwavering response to the US sell-or-ban law, recently upheld by the country's Supreme Court. This law poses a significant challenge to TikTok, which boasts 170 million American users, amidst growing concerns about national security risks associated with its Chinese ownership.
Despite the uncertainty surrounding its US operations, TikTok has listed numerous e-commerce job openings in Italy, France, and Germany, as well as in Tokyo and Sao Paulo. In Germany, TikTok is set to introduce the "Fulfilled by TikTok (FBT)" model, where the platform will manage storage, packing, and shipping on behalf of sellers. This approach was first introduced in Britain in 2023.
Following its launch in Spain and Ireland in December, TikTok's expansion into more European countries was initially planned for last summer but was delayed due to increased scrutiny from the US government. The latest expansion drive will see TikTok Shop operating in over 10 countries, including the US and Mexico.
In the face of US uncertainties, TikTok has outperformed competitors like Shein and PDD Holdings-owned Temu. TikTok Shop's sales in January surged by 153 per cent year-on-year in the US, surpassing Shein's 26 per cent increase and Temu's 28 per cent growth. TikTok is making significant strides in transactions exceeding US$25, a key segment for Shein, with its market share in that category growing by 16 percentage points.
In the segment of transactions under US$25, where Temu typically excels, TikTok Shop saw a 7 percentage point increase in January compared to the previous year. The platform's expansion into e-commerce across multiple countries reflects its commitment to diversifying its offerings and reaching a global audience.
TikTok expanding e-commerce operations to Italy, Germany, and France
Launch plans for Japan and Brazil in the pipeline for this year
TikTok Shop's social commerce approach with the "yellow shopping cart" icon
Source: SCMP