Amazon sellers flock to TikTok Shop despite looming US ban | Real Time Headlines

Sarah Potempa, wearing a sparkling dress and a Santa hat on her pink hair, stands with a smartphone in a hair care company warehouse in Waukegan, Illinois forward. It’s time to go to work.

Potempa is a celebrity hairstylist who goes live on TikTok multiple times a week. In what Potampa calls a “packing show,” she will live-stream packing orders for her popular Beachwaver curling iron for six to eight hours at a time.

The Nov. 20 livestream had a party atmosphere, with Potempa taking a break between sending orders while dancing to 50 Cent’s “In da Club.” For the more than 1,000 TikTok users who regularly tune in to Potempa’s show, it’s a combination of entertainment and shopping.

Beachwaver is one of a growing number of retailers flocking to the video app’s shopping service, TikTok Shop. Douyin store Launching in September 2023 Created as a way for users to purchase products without leaving the app, the Chinese-owned app has since become a viable alternative for retailers looking to diversify their e-commerce operations. Amazon.

Through a dedicated “Store” tab, retailers large and small promote a variety of products, including eye shadow palettes, mobile phone chargers, detox teas, treadmills, and more. On TikTok, retailers often offer generous coupons and offer free shipping within a few days. Shoppable posts look like regular videos but are ads for products sold in the TikTok store and often appear in TikTok’s main video feed, the “For You” page. These posts allow users to purchase products without exiting the For You feed.

On Potempa’s show, shoppers compete to place their orders to receive 50% off Beachwaver products, as well as free add-ons with their orders, like face wash or lipstick, as well as the chance to have their username read aloud as Potempa packages their orders. on the screen.

“When TikTok Shop first launched, people hadn’t used it yet, and they were asking, ‘Is this available on Amazon?'” Potamp said in an interview. “I’ll get questions like, ‘Can I buy it elsewhere?’ Now that it’s been out for about a year, we’ve done 1.2 million orders.

TikTok, owned by ByteDance, has cemented itself as an advertising giant and through TikTok Shop, the company has been trying to carve out another revenue stream through e-commerce. The company has attracted such NikePacific Sun and Crocswait. The retailers hope to attract the more than 170 million Americans on TikTok who make impulse purchases while browsing videos.

They’re not the only ones.

Amazon sellers were also persuaded to try the service, promising low fees and deep discounts on products offered by TikTok. In addition to sellers, the company has hired talent from Amazon to fill key TikTok Shop roles in areas such as marketing, creator relations, brand safety, category managers and operations.

According to reports, in the 15 months since its launch, TikTok Shop has become a “huge e-commerce machine” e-commerce databasea market research company. EcommerceDB predicts that TikTok Shop’s total merchandise volume (the dollar value of items sold on its marketplace) will more than double to $50 billion this year. That’s just a fraction of Amazon’s expected 2024 GMV of $757 billion, but TikTok Shop is making great strides.

“Every time you scroll, every other scroll is a store post, so they invest heavily in encouraging in-app conversions,” Caila Schwartz said. salesperson’s Director of Consumer Insights and Strategy for Retail and Consumer Products.

Amazon spokesperson Mira Dix told CNBC in a statement that sellers are engaging with the store “more than ever” and are experiencing greater success. Dix said the company’s optional services for sellers, such as fulfillment services, cost “on average 70% less” than comparable two-day shipping alternatives.

“Our selling partners are incredibly important to Amazon, and we work hard to innovate on their behalf and support the growth and success of these businesses across all sales channels,” Dix said.

April, President Joe Biden signs a law The bill requires ByteDance to sell TikTok before January 19. sued Block this action.

President-elect Trump can save TikTok is immune from a potential U.S. ban. After trying to impose a TikTok ban during the first administration, Trump changed his stance, admitting in a March interview on CNBC’s “Squawk Box” that the app “has a lot of good and a lot of bad.” Trump changed his stance when he met with billionaire Jeff Yas, a major investor in ByteDance.

As the January deadline approaches, TikTok is largely operating its business as usual.

At an October event in Manhattan with business owners and social media influencers, TikTok Shop executives positioned their market as a holiday shopping destination. Nico Le Bourgeois, head of U.S. operations for TikTok Shop, said users have purchased hundreds of millions of items on its e-commerce platform since its launch in September 2023. Le Bourgeois joined TikTok in August 2023 after nearly nine years working in various departments at Amazon, including third-party marketplaces.

Le Bourgeois told CNBC in October that TikTok Shop wasn’t trying to sell “everything” to everyone. He added that TikTok Shop is a product discovery marketplace showcasing “new, cool, and fun” items from brands large and small.

“You see it, you like it, you buy it. It’s not a search,” he said. “It’s a very different way of shopping.”

Le Bourgeois declined to comment on the impending TikTok ban, but a company spokesperson at the event said TikTok Shop is not slowing down.

“The sellers here, the creators, they are making a living on TikTok,” the spokesperson said. “We will continue to work on this. This is a huge opportunity for us.”

According to statistics, about 63% of Western consumers plan to purchase goods from Chinese shopping apps during the shopping season salesperson. These include TikTok, Alibaba’s AliExpress, Shein, Temu and fast fashion company Cider.

On Saturday, TikTok said its U.S. Black Friday sales topped $100 million, with homewares, fashion and beauty products being the most popular categories. Canvas Beauty is the best-selling hair care and beauty product on the TikTok Shop, and the company said it generated $1 million in sales within two hours of the app going live.

Retailers and sellers, some of whom count TikTok as the lion’s share of their online sales, told CNBC they are sticking with the platform despite the possibility of it disappearing.

While it’s impossible to ignore the discussion surrounding TikTok’s possible ban in the U.S. as a brand that relies heavily on the platform, Yay’s Snacks COO and co-founder Rachel Cheng said she doesn’t believe TikTok will be banned under the Trump administration Disappear because it won’t appear to be the president-elect’s main focus.

Yay’s Snacks, which makes crispy Cambodian beef jerky, was one of the first companies to join the TikTok Shop when it launched. Yay’s CEO and founder Marlin Chan, a former YouTuber, often posts humorous TikTok videos promoting his snacks, which are based on his grandmother’s original recipes. Among the films were a series of parodies of the show Undercover Boss. The videos have helped Yay’s amass tens of thousands of TikTok fans, who continue to buy the jerky, Cheng said.

Cheng said TikTok sales once accounted for nearly 90% of Yay’s total revenue, and the app’s monthly sales peaked at $75,000 last November. Yay’s prepares to pivot to Amazon Have your own website If TikTok is banned, Cheng said, as long as TikTok “is still here, we will do everything we can to stay ahead.”

“If we were sitting here worrying about what’s going to happen next, we would never be on TikTok Shop,” Cheng said. “We enjoyed it while it was hot.”

Scrub Daddy, known for his smiley-face-shaped sponge, became popular on TikTok during the coronavirus pandemic and has more than 4 million followers. it is Popular videosDemos of its Damp Duster sponge have been viewed 30 million times, according to the app, while its best-selling product on the TikTok Shop has been purchased nearly 76,000 times. This number does not include items returned after purchase.

Scrub Daddy CEO Aaron Krause began to lose faith in traditional marketing after appearing on “Shark Tank” in 2012.

“We did TV commercials, we did some outdoor advertising on billboards, we did some radio,” Krause said. “I realized I was just throwing money in the air.”

Krause said the company turned to social media marketing, primarily on Instagram, which proved to be “the first pot of gold.” Scrub Daddy set up an account on TikTok in 2020 and has partnered with influencers to promote its products, including Vanessa Amaroa popular account for house cleaning content, has over 5.7 million followers. After Amaro introduced the sponges to viewers, Scrub Daddy sold 30,000 units in one weekend, Krause said.

TikTok’s “algorithm only allows you to get millions of views from a hysterically crazy video,” he said.

In recent months, TikTok has encouraged retailers and sellers to host hours-long live broadcasts multiple times a week as a way to connect with shoppers. Many brands have invested in building their own studios to record shows, or hired talent to host shows.

Scrub dad snatched away Longtime QVC host Dan Hughes In 2023, he was fired from the home shopping company.

TikTok Shop was a hot topic at an Amazon seller conference in New York in October. ‘How to Scale Your Brand’ session with TikTok Shop drew a packed room of sellers who listened to e-commerce strategists Rafael MH Talk about brands potentially making $8 million to $10 million in sales from TikTok in less than a year.

“Amazon faces a lot of competition,” MH said. “TikTok is a free opportunity to attract attention and make sales.”

Michelle Barnum Smith, who advises online businesses, said many Amazon sellers have now embraced TikTok after initially being slow to join.

Barnum Smith said, “I was a dirty gold miner standing on a street corner in New York and saying, ‘There’s gold in those mountains,’ and people were like, ‘Yeah, of course,'” where, Or their friends are there and they’re like, ‘I have to go there.

Barnum Smith said Amazon sellers now have an “extreme fear of missing out” on joining TikTok, even if TikTok ceases to exist in the United States next year.

“Whatever the future holds for TikTok Shop, they’re happy to take the money now while the revenue is still good,” Barnum Smith said.

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