The TikTok Shop is about to drop.

Having long ago figured out how to monetize the content that appears on the social media site, through advertising revenues, TikTok is now looking for a new source of income, by installing a “Shop” button, on both its landing page and select content providers’ pages. When users click on the button, they either go straight to the purchase page or can access the digital marketplace of all items for sale through TikTok.

For users and consumers, the added button provides a convenient, accessible means to obtain the products that influencers and featured personalities on TikTok are using or wearing. Considering TikTok’s role, as a “cultural trendsetter” and arbiter of coolness, such ease of use and direct access should appeal to consumers. They do not have to search far and wide for the latest gadget or pants style but instead can have it shipped quickly to them, simply by surfing social media, as they would have been doing anyway. Thus for example, if they watch a TikTok that features Kate Middleton, sporting a Madewell blouse, they can quickly click through to purchase the same top from the Madewell section in TikTok’s marketplace.

For content providers on the site, the new button also promises monetary benefits. Various influencers who have made their names on TikTok vie to host their own, dedicated Shop button, so that they can earn royalties on gear that they promote and display. When done well, their offerings align with their content, such as a fitness influencer who promoted water bottles, which led to 2 million views, sales of around 600 units, and thousands of dollars in commissions for the influencer. Currently, in its earliest days, the TikTok Shop already features around 200,000 sellers in the general marketplace, and approximately 100,000 content creators have qualified to host their own buttons on their videos. They can promote either the products available in the marketplace, like the fitness influencer did, or market their own products.

The Shop option is available on livestreams, though that is not the primary focus for TikTok currently. Noting that, unlike Asian consumers, U.S. users appear less engaged in livestream shopping options, TikTok anticipates that by spreading the Shop function to videos available at any time the viewer brings them up to watch, it can expand sales.

In support of that goal, TikTok has undertaken an intense marketing campaign to attract both sellers and buyers. For example, discounts available to buyers drop the prices of many of the items available, but TikTok continues to pay the sellers the same commission. One small beauty brand noted that on TikTok, one of its already popular products was selling for $11 less than the retail price of $39 that it charged on its own website. But TikTok accounted for those differences, and it paid commissions based on the pre-discount, retail price. Therefore, making the products available through TikTok earned the company a “life changing” amount of income.

Although TikTok arguably can, and should, charge sellers more for the right to appear on the site, its goal right now is growth for the TikTok Shop. Thus, in these early days, sellers are competing to get their products up, whether they function as content creators themselves or just hope to be featured in the marketplace.

Discussion Questions

1. Have you used the TikTok Shop yet? Would you plan to, if you saw something you liked on a video?
2. If TikTok starts taking a percentage of sales, how much should it take from sellers?

Source: Sapna Maheshwari, “TikTok Popularizes Products. Can It Sell Them, Too?” The New York Times, September 12, 2023;