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TikTok partners with Shopify

Date

21/12/2020

Written by

Airnow

Unless, like us, you’ve been distracted by watching the Queen's Gambit on Netflix, then you’ll have noticed that TikTok recently announced a global partnership with Canadian eCommerce platform Shopify. The partnership was made available on the 27th October in the United States, and will be introduced to other markets in North America, Europe and Southeast Asia next year.

With the introduction of Facebook Shops, as well as the spike in e-commerce as a result of COVID-19, it was only a matter of time before TikTok reacted to their rivals moving into the e-commerce space. It seems all these companies are looking to get their own slice of the ecommerce cake, which has so far been dominated by Amazon.

TikTok’s announcement can be seen as part of the burgeoning trend of ‘social commerce’ - where social platforms use their social networks as a social commerce marketplace for buying, selling and providing more shoppable content formats to sellers and influencers.

Facebook Shops

In May, Facebook introduced ‘Facebook Shops’ to Facebook and Instagram, enabling businesses around the world to set up a single online store to sell their products with no fee on the social media sites. The initial stage of the Facebook Shops rollout was brought forward and extended because of the COVID-19 pandemic, and the stores will appear on business pages, Instagram profiles and through targeted ads.

COVID-19 & the growth of e-commerce

As the COVID-9 pandemic continues to reshape our world, consumers have turned to shopping online in greater numbers and frequency, sparking an acceleration in the already present shift away from physical stores to online shopping. According to data from IBM’s U.S. Retail Index, department stores are expected to decline by at least 60% over the full year. Meanwhile, e-commerce is projected to grow by nearly 20% in 2020.

This has sparked a race amongst e-commerce firms who are scrambling for a slice of the action.

One of these e-commerce firms is Shopify.

From e-commerce to social commerce

We already know that building a successful brand means that merchants need to be wherever their customers are spending their time. And where are customers doing that? Well, a lot of people, it transpires, are spending a whole lot of time on social media sites, and this has only increased during the lockdowns that have swept the world in 2020. One of the fastest growing of these sites in Europe is, of course, TikTok, which is growing exponentially to the tune of 17 million locked-down users spending over an hour a day on the app in Britain alone.

This, of course, represents a huge opportunity. If harnessed correctly, this massive audience could be the perfect platform from which to grow commerce. After Facebook’s announcement, the TikTok-Shopify partnership could be seen as yet another development in what appears to be a new battleground for app marketers: social commerce.

The power of blending e-commerce and social media

When you consider the power that combining e-commerce and social media has, it’s no surprise why so many of these firms are battling it out for their own chunk of the market. The value for marketers is that the blend of e-commerce and social media allows for customers to discover brands through social content, and find products that they would not otherwise search for on a standard e-commerce site.

The process of “discovery through social content” is of paramount importance for smaller businesses that do not have the capacity to cover the costs required to advertise on an e-commerce site such as Amazon. While the customer journey is often longer and less direct, it also allows for greater brand exposure in many other ways. For example, brands may be able to create a more bespoke shopping experience, bringing the customer closer to the brand and creating loyalty in the long run.

Of course, the social factors of social media platforms also make for an interesting dimension for marketers. Brands have the opportunity to produce interactive, sharabale campaigns that help product launches go viral. Breaking the traditional means of marketing (through group-buying discounts and interactive contests) makes for a welcome change that can lead to a highly engaged consumer base.

TikTok & Shopify’s partnership: the features

The key difference between social commerce and regular social media marketing is that rather than trying to drive referral traffic from social media to a specific website or online store, with social commerce the entire shopping experience happens without the customer ever leaving the social media site.

The TikTok channel allows merchants to create and connect their TikTok For Business account to deploy In-Feed shoppable video ads directly within Shopify. Sellers can select which products they would like to feature, and video ads are automatically generated that drive them to their Shopify stores for conversion. There are a variety of ready-made templates that have been created with the intention of driving commerce that any seller can have access to.

Shopify and TikTok have also announced that they will be collaborating in the coming months to test new commerce features that will further encourage sellers to expand their paid and organic reach on video and on profiles.

The continued integration of the two sites will no doubt bear much fruit for the two companies, as well as a host of sellers who are likely to take full advantage of the new features available. Here’s a quick run down of the main features involved:

  • Highly integrated “1-click” pixels: Installing and connecting TikTok Pixels has never been easier, in just one click sellers can track conversions.

  • TikTok Campaign Hub: Sellers are able to create campaigns, target audiences and track performance all in one place.

  • Easy Creative Content: TikTok is all about videos, and the new TikTok channel allows Shopify sellers to quickly and easily create high quality TikTok videos in minimal time that will instantly catch on with the community.

  • Freebie: Eligible sellers can claim a freebie worth $300 in ad credit to help kickstart their first campaign.

What does this mean for the future of social commerce?

In the space of just a few short years, shopping journeys have gone through revolutionary change, from the now age-old ‘search, click, buy’ to a more dynamic form of commerce defined by fluidity. Nowadays it is likely that dozens of factors are influencing the decision-making process of a customer which have been developed over a much longer period and are far more complex, spanning multiple channels.

Social commerce is the newest of these channels, and its prevalence has no doubt been accelerated as a result of the rapid digital adoptions that the COVID-19 lockdowns have engendered. This series of events have meant that the market is thought to be worth 89.4 billion right now, and it is projected to grow to $604.5 billion in the next seven years. So, with those kinds of figures, you can expect the social commerce market to be ever more pervasive in our society as time goes on.

An interesting marker for what the future might hold for the social commerce market can be found when looking at the Asian market, which is a few years ahead of the West when it comes to social commerce. In China, the goliath app WeChat is perhaps the biggest indicator of where things will head in the West.

China has already reached a point in its social commerce journey where not only are customers using social media and apps to purchase products, they are also using social media platforms to engage with brands at every level of their purchasing journey. The breadth of services that WeChat provides has led to it being named the ‘end-all’ platform. Within the app, brands can present anything from content, payment methods, and social interactions to live streaming, personalised e-commerce experience and customer service, providing the ultimate, personalised service to its customers.

The growth of social commerce could be seen as the beginning of the homogenization of all aspects of modern life onto fewer and fewer mega apps. The dawn of Facebook Shops, and TikTok’s partnership with Shopify, is perhaps a real sign of things to come in the West.