TikTok Shop Will Reinvent Social
How brands can master the shift from E-commerce to A-commerce
3 minute read
This article is a part of our continuing series, “Why TikTok is the Future of Everything” about the ways in which TikTok is reinventing how we socialize, search and shop.
TikTok has been secretly working on something called “Project Aquaman.” It’s part of a wider global plan to parlay their cultural influence into commercial domination as they double down on social commerce. Expected to reach $61.5 billion next year, shopping on social is about to get easier as TikTok Shop launches in the US next year. To leverage this shift, brands need to start thinking differently about content and creators alike. Both will need to work harder as feeds go full funnel.
Social content drives social commerce
Social commerce is growing at breakneck speeds. By 2025 it’s expected to reach $1.2 trillion globally, up from $492 billion in 2021. Considering 64% of social media users surveyed by Accenture users say they have already purchased from a feed, brands have a tangible revenue opportunity before them. TikTok is likely to accelerate adoption more than any of its competitors as the TikTokification of social media continues. The platform’s users are primed to purchase with 83% saying TikTok plays a role in their purchase decisions.
Views for TikTok videos with the hashtag #TikTokMadeMeBuyit increased 502% in the past year alone, signaling a strong correlation between shopping and social content. The impact of that association will only grow as younger consumers normalize the process of buying on TikTok for the older generations who followed them there in the first place.
A-commerce is the new E-commerce
As we’ve previously written, the TikTok algorithm keeps us scrolling for 80 minutes a day on average – more than Facebook and Instagram combined. Imagine the upside for brands when the algorithm is optimized for products as well as it is for content. Employing something akin to automated A/B testing, the TikTok algorithm takes educated guesses at what it thinks you might like, testing its own predictions and getting smarter along the way. This algorithmic form of commerce (A-commerce) is a win for brands and TikTok alike driving higher conversion rates and more relevant shopping experiences.
As TikTok tracks more data, AI informs the algorithm for even tighter targeting. This is precisely why TikTok expanded their ad products to include pixel tracking, which now pulls in data from more than half a million websites and online stores. While the technology itself is nothing new, having it available at scale on a cultural powerhouse like TikTok, can generate massive revenue and serve as a stronger form of attribution for marketers.
While change is in the air as we head into 2023, one thing will remain constant –– the importance of optimizing content around TikTok’s interest-driven algorithm. It’s what keeps us scrolling and soon it will be what keeps us shopping. Brands with a deep understanding of their customer’s passion points have the edge here, as they are more likely to create content that authentically resonates, boosting both relevance and revenue.
TL;DR
Given TikTok’s increasing influence over competitors and its cultural cache among younger consumers, the platform is likely to accelerate adoption of social commerce across the US.
As TikTok doubles down on social commerce, brands will need to rethink the role of content and creators alike.
Tapping into the power of their not-so-secret weapon, TikTok’s algorithm will evolve to keep us shopping as effectively as it keeps us scrolling. Brands that know what resonates with their customers have the edge as relevance translates to revenue.
In our next issue, we continue our focus on TikTok and explore the impact and opportunity social shopping will bring to brands, and what's needed to win. For more on how TikTok is reinventing how we socialize, search and shop, read our three-part series "Why TikTok is the Future of Everything”