How TikTok Will Mature as the Next One-Stop Shop

TikTok turned five years old last month, which might be a surprise to many who thought the social media platform only emerged last year. And while it certainly gained enormous popularity and global appeal during the pandemic, this little app has come a long way from its humble beginnings as a lip-syncing app, or for anyone brave enough to call it the "new Vine" (RIP).

Helping boost its meteoric rise to international fame was the platform’s content; mostly dance challenges, memes and other sorts of creative user-generated content that relied on pop culture or zeitgeist knowledge. Where once there was the Ice Bucket Challenge — a fairly harmless viral awareness campaign that took place largely on Facebook — TikTok has, too, spawned a number of borderline dangerous viral trends. Most recently, the “Milk Crate Challenge,” featuring people climbing up on top of a very insecure pyramid of milk crates.

While it may be criticized and questioned for its viability as a serious media platform, any backlash it receives seems par for the course for a successful platform. And TikTok is proving to be a true pillar of social media — and shopping — success, rather than a one-hit-wonder.

Innovation and Partnerships as Key Drivers for Commercial Success

Not only is it now providing the same levels of fame and follower fortune for its creators as the YouTubers and Instagrammers that have gone before, TikTok is turning into a serious commerce channel in its own right.

YouTube and Instagram still command the big bucks when it comes to advertising, product placement and endorsement, but TikTok’s attractiveness to brands is clear. Earlier this year, the State of Mobile report from App Annie noted that people were spending more time on TikTok than on Facebook. In September, TikTok had also overtaken YouTube watch time, in both the U.S. and U.K.

Key to staying relevant in the social sphere is to innovate at speed. TikTok is no exception, with a dizzying array of innovations, partnerships and new approaches emerging every day. Some have said it’s the ideal medium for the attention-span-lite generation, but that would do it an injustice. The snappy, sharable format and lively content has been responsible for its rapid growth as a serious contender. And it's this innovative spirit that, applied to the platform’s commerce offering, will make it a true retail presence.

It will be interesting to see how TikTok manages to maintain its more anarchic reputation, compared to the social establishment, when going after the customer dollar. Both the platform and its creators will be keen to maintain their cachet, but will inevitably need to see volume sales to make a profit.

One trial in May 2021 involved a limited e-commerce partnership with Hype, the streetwear label (not to be confused with TikTok’s Hype House), itself treading the tricky line between mass-market success and maintaining its niche appeal. Still in the prototype phase, it’s just one of a variety of options being tested by the platform.

More established is TikTok’s link with Shopify, sealed in October 2020 when the company still had President Trump’s threat of a forced sale hanging over its U.S. operations. The latest development in this partnership gives brands the ability to soon add a shopping tab to their TikTok profiles and sync their product catalogues to create a mini storefront, linking directly an online store to checkout. Recent research suggests that almost half of TikTok users have purchased after seeing a product or service advertised, which is very promising and probably a number we can expect to continue to rise as that platform enhances its shopping offering.

Meeting TikTokers’ Expectations

Unlike the early iterations of commercial content via YouTube when there were concerns that audiences wouldn’t appreciate a sales pitch cropping up in content, the TikTok audience seems wholly receptive to shopping on the app, and the best content generates mass participation and huge virality.

In 2020, e.l.f. cosmetics developed a campaign with the Movers & Shakers agency to create the #eyeslipsface challenge, becoming the fastest-ever TikTok campaign to reach 1 billion views. The company capitalized on the success of this campaign with its subsequent e.l.f. x Chipotle collaboration (yes, you can buy guacamole and chips-inspired makeup), once again making it available on TikTok.

Notably, e.l.f. Beauty made the actual product available for sale via the NTWRK app, a kind of mobile QVC for Gen Z. This platform features exclusive products and original content from creators, seamlessly blending a shoppable entertainment environment. Brands manage to retain that sense of exclusivity while driving sales, with products coming out in scheduled "drops" rather than hosting a rather dull always-open storefront. Without a directly shoppable platform, this is TikTok’s missing link.

TikTok has clear ambitions to become an e-commerce titan, as well as a leading content platform and tastemaker. The template has already been set by the Chinese-only Douyin, which garnered sales of $26 billion in its first year. One thing is certain: TikTok, its creators and its audience all have an appetite for a shopping experience as slick and snappy as its videos.

Caroline Buckingham is client strategy director at digital marketing agency Croud.