To say it’s been an interesting twelve months for TikTok would be an enormous understatement. It feels like a lifetime ago now, but this time last year, the company faced the threat of being banned by the United States of America (and perhaps much of the western world along with it). At the time, President Donald Trump and his administration believed that TikTok was nothing more than a front for the Chinese government, which allegedly used the app to spy on the phones of American teenagers. Since Trump lost the 2020 Presidential Election to Joe Biden, things have changed. There no longer appears to be an imminent existential threat to TikTok, so the company has started making plans for the future. Some of these plans apparently involve trying to persuade you to buy products through the app.
According to reports that have been published in the USA within the past few days, testing for the proposed roll-out of a new e-commerce arm for TikTok has already started. ByteDance, the company behind the incredibly popular app, has selected a handful of brand partners to work with in an attempt to push their products through the app and persuade their young audience to buy them. One of them is the streetwear clothing label Hype, with more names expected to be announced in the near future when an official statement is released. ByteDance has a strong track record of success in this area, having made billions of dollars last year selling products through Douyin, the China-only version of TikTok. If they could make $26bn in China alone using the platform, which is the figure we’ve seen, we can only begin to imagine that they might be able to make in the rest of the world.
Although most of the reporting on this matter comes from the US, the trial itself is believed to be taking place in the United Kingdom, where the e-commerce features are already available to a small number of users. There are screengrabs circulating online of Hype’s TikTok page displaying products, prices, and buying options for eager users to tap on and interact with. If this move is successful, it will be another feather to ByteDance’s bow before it makes its first public offering later this year. Previous statements and documents released by the company indicate that it foresees a big future for itself within the e-commerce industry, perhaps handling up to $185bn in revenue each year.
Their ultimate success or failure in this endeavour will depend on whether they can approach the new commercial aspect of the app in a way that will appeal to Generation Z. The average TikTok user belongs to that generation, and they’re notoriously hard-to-reach when it comes to electronic advertising. They’ve grown up around digital marketing schemes, and they’ve learned how to avoid them. Marketing experts have been frustrated in their attempts to communicate effectively with them for the past three or four years, but through TikTok, brands might soon have a route to get in front of them in a way that they’re more prepared to accept.
The move will have its critics – especially among those who feel that social media is inherently harmful even without a committed commercial arm. The way that users hold and refresh news feeds in apps like Twitter and Facebook has been compared to the way that gamblers use a similar method to spin the reels of online slots, and is thought to stimulate the same part of the brain that hopes for “instant hit” dopamine rewards. That might be acceptable when we’re talking about online slots because they’re targeted at adults. TikTok is extremely popular with teenagers, including teenagers younger than 18. Users of that age wouldn’t be allowed to open an account with Rose Slots for New Zealand Players, but there are no restrictions on them opening a TikTok account. To critics, TikTok, Facebook, and other social media platforms are using online slots tactics on audiences who ought not to be old enough to be exposed to them, and that’s problematic.
TikTok will, of course, reject any such assertion. They’ll tell you that they’re just providing a new way for users to stay in touch with the products and brands that interest them, and there’s no law against teenagers buying clothing or any other non-restricted product that interests them. In the background of all this, online retail has reached a new high of five trillion in sales per year based on figures from 2020. There’s a clear incentive for more and more companies to become involved in this sector, and TikTok’s captive user base could give ByteDance an advantage that many of its competitors could only dream of.
Even with these plans in place, though, there might be a bump in the road coming for ByteDance. These new commercial platforms will only be successful so long as it remains legal to keep track of a user’s interests and push products and adverts at them that they might be interested in. This is the way that Facebook has been handling marketing and promotion for years, but it might not be able to do so for much longer. Recent changes in Apple’s policies will make it difficult for Facebook and its associated apps to track activity on Apple-made hardware – especially iPhones – and this will make Facebook’s approach less effective. If Apple is willing to do this to Facebook, it’s willing to do it to anybody. TikTok won’t be exempt from that if Apple decides that ByteDance’s approach is predatory, and other companies might follow where Apple leads. Even if they don’t, iPhone users account for a huge proportion of TikTok’s customers. Without them, the new marketing opportunities that ByteDance hopes to present might lose a lot of their appeal for their commercial partners.
It might be some time before TikTok’s new e-commerce functions reach the United States of America, and if there are problems with it in the UK, it might not get there at all. Until we have clarity on the issue, though, beware of the sudden appearance of any infomercials while you’re browsing TikTok. They might not have ended up in front of your eyes for reasons as innocent or organic as TikTok would like you to believe.
