TikTok takes aim at Facebook and Instagram with its new shopping features

Shopping on social media is getting bigger and TikTok wants in.
Shopping on social media is getting bigger and TikTok wants in.
Image: REUTERS/Dado Ruvic/Illustration
We may earn a commission from links on this page.

TikTok unveiled new shopping features for brands on Tuesday (Sept. 28), positioning it to compete with the largest social media companies on e-commerce.

The Chinese company, owned by ByteDance, has been steadily rolling out shopping features over the last year, partnering with Shopify and Walmart among others. Now, TikTok is giving marketers a suite of shopping tools including shoppable links, livestream shopping, and product galleries in ads. TikTok Shopping first piloted in the US, UK, and Canada in August.

This functionality pits TikTok against Facebook, Instagram, and Pinterest, which dominate US social commerce, effectively the buying and selling of products through social media. According to the research firm Insider Intelligence, Facebook will sell to 56.1 million users in 2021 on its main app and to 32.4 million on Instagram. Pinterest will attract the third-most buyers with 13.9 million expected, the research firm said.

Mike Proulx, vice president and research director at the research firm Forrester, said in an interview that social commerce is becoming “much more of a native user experience within social media apps.” Forrester research shows 38% of US adults buy products monthly on social media.

Claiming 1 billion global users as of this week, TikTok poses a rising threat to Facebook in one of the most important potential growth areas for both companies.

Social commerce has swept China

In the US, social commerce is still nascent compared to China. Chinese consumers will spend about $351 billion on purchases mediated by social media in 2021, Insider Intelligence projects, while Americans will spend about $37 billion. It’s a growing sector: social commerce sales are expected to rise 36% in the US this year.

WeChat, the ubiquitous chat app owned by Tencent, dominates social commerce in China. But ByteDane tripled its sales on Douyin, TikTok’s counterpart in China, to $77 billion in 2020, according to one Chinese media outlet. While livestream shopping in the US focuses on apparel and beauty, Chinese consumers are accustomed to buying everyday goods like groceries and meals off of influencer-led live streams. It’s uncertain that those habits will translate to the US market, but social commerce is widely considered a promising slice of growing e-commerce sales.

TikTok made me buy it

Since it rose to prominence in the US, TikTok has played a small but growing role as a recommendation engine for shoppers. While dwarfed by direct sales from competing platforms, viral posts on the platform have driven huge sales for a few products: CeraVe skin products, a cleaning paste called The Pink Stuff, catnip called Cat Crack and certain pair of now-famous leggings.

One of the company’s new slogans, “TikTok Made Me Buy It,” has become a rallying cry for creators trying out viral products, but until now the company has not equipped businesses with the tools to actually sell direct to consumers. That’s finally changing as US customers become increasingly comfortable shopping on social.