Shulou(Shulou.com)11/24 Report--

"A small shop is a big story", watching TikTok Shop rush into the American market.

Author: Fei Fei |

Editor: Tang Shi |

In November last year, TikTok Shop landed in the United States, and applications for residency rose rapidly. According to professional forecasts, more than 90% of American small businesses will open stores in TikTok this year, and most American consumers will choose to shop at TikTok. Various facts suggest that TikTok may become the fastest growing platform this year.

But another fact is that Amazon is still the strongest e-commerce platform in the world, so can TikTok, which started with short video service, challenge Amazon's dominance? Can China produce a world-class e-commerce platform?

01. Downloads reached the peak, sweeping the US market.

No matter in any overseas market, TikTok has become a super App. Let's take a look at a set of data. Last year, TikTok had the highest number of downloads worldwide, with 672 million downloads, according to professional statistics.

Specific to the U. S. market, TikTok downloads are also very considerable, with 99 million firmly at the top of the app rankings, and over time, the number of downloads continues to rise.

The large number of downloads means that TikTok has become a huge source of traffic, so TikTok has become a must for merchants. In addition, TikTok Shop opened up the United Kingdom, Southeast Asia, the United States and other regions last year, which greatly stimulated overseas businessmen. As far as small businesses are concerned, among the sample data surveyed, the number of small businesses opening stores on TikTok in the United States this year is expected to exceed 90%.

On the consumer side, the United States is a more mature country for e-commerce consumption, and consumers' online shopping habits are more obvious. Survey data show that at least 78 per cent of US consumers will choose to shop on TikTok Shop this year. In addition, consumers are also very sticky to TikTok Shop, and most consumers pay a monthly fee to buy members, which shows from the side that TikTok is indeed very popular in the American market.

The favor of small businesses and consumers to TikTok constantly forces enterprises to adjust their business. Most enterprises also believe that the emergence of TikTok Shop in the United States market will have a positive impact, and will invest corresponding funds to carry out marketing promotion.

02. Can you challenge Amazon?

Going out to sea has become a choice for many enterprises to seek the growth curve in the past two years. In fact, going to sea is a spillover of China's advantages in manufacturing, supply chain and other aspects. Compared with overseas markets such as Southeast Asia and the Middle East, China does have a strong advantage in these links.

However, it is a pity that there is no real world-class e-commerce platform in China as far as cross-border e-commerce is concerned. TikTok downloads in the world is very considerable, but TikTok Shop only opened last year in the United Kingdom, Southeast Asia, the United States and other sites, the time is still relatively short. So, based on a huge user base, can TikTok Shop challenge Amazon's dominance?

Let's take a look at the supply side first. in the American market, it is not difficult to register a small store on TikTok Shop. If you are an individual user or a small business, you only need a mobile phone number and email address in the United States, or register directly with your TikTok account. If it is a corporate identity, it needs to be verified by a corporate license and a driver's license.

It is worth mentioning that there is no fee to register a small store on TikTok, in this case, coupled with the relatively easy registration process, this helps to increase the number of small businesses.

On the consumer side, TikTok had 140 million registered users in the United States as of July last year, with an average of 27.3 percent placing orders on TikTok last year. According to the 2022 North American Consumer Trends report, as of the first quarter of last year, there were 313 million Internet users in the United States, which means there is still a lot of room for TikTok users to rise. With the increase in the number of users, more users will choose to shop in TikTok.

By this year, the proportion of TikTok users shopping in small stores is expected to rise to 37 per cent. Compared with the Amazon platform, 89% of consumers will first search for products on Amazon before buying, and 86% of consumers will buy directly on Amazon.

The base is relatively small, but it is developing rapidly.

From the above data, it is not difficult to see that TikTok Shop is a long way from Amazon in terms of the number of registered users and consumers' dependence on the platform. But it is worth noting that as the cross-border e-commerce platform that China is most likely to "arm wrestle" with Amazon, TikTok Shop is growing at an unusually rapid pace.

Let's take a look at a case. At the end of last year, TikTok Shop launched a global year-end promotion season, which was the first of its kind since the launch of TikTok Shop. The whole event linked the markets of the United Kingdom and six Southeast Asian countries, including Malaysia, Singapore and the Philippines, and attracted more than 60,000 merchants around the world.

The participation of a large number of merchants and users directly led to a surge in GMV sales, with TikTok Shop's cross-border e-commerce business up 136 per cent and orders up 77 per cent. During the whole period of the event, the total length of live broadcast exceeded 2.72 million hours. If the total live broadcast time is calculated on the basis of 24 hours per day, the cumulative live broadcast time will be changed to years, and it will last for more than 300 years.

Considerable data means that TikTok Shop can directly reach registered users and turn users into consumers through live streaming, short videos or shop windows. At present, compared with Amazon, the global e-commerce leader, TikTok Shop is still a long way from the world-class platform, but TikTok has a huge user base, which provides imaginative space for the sustainable development of e-commerce small stores.

04. "small shops make a big difference" to boost global trade

As mentioned above, TikTok Shop launched the first major promotion activities, and achieved good results, which also shows that TikTok Shop must have a deep understanding of the local market. TikTok Shop connects the markets and resources of six countries, which requires TikTok Shop to have the ability to integrate global resources.

For small and medium-sized businesses, relying on transnational e-commerce platforms such as TikTok Shop, cross-border trade can also be carried out around the world, which greatly expands the scope of business and provides more opportunities for a large number of small and medium-sized businesses to carry out global trade.

From this point of view, although TikTok Shop launched small e-commerce stores, the small shop business contains a "big universe". If you open a store, the goods can be sold all over the world, and will become a platform for countless small and medium-sized businesses to expand their global business.

Facing the future, with the rapid growth of TikTok registered users and the rise of social e-commerce around the world, TikTok Shop's live streaming with goods, window and other modes will bring more room for imagination for cross-border small businesses from around the world.

This article is from the official account of Wechat: new Research (ID:chuxinyanjiu), author: Feifei

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