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TikTok Shop likely gained market share in U.S. e-commerce

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TikTok Shop uses influencers to boost sales

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TikTok Shop spending tops Shein, Temu in the 7 days to

Cyber

Monday

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Court upholds law requiring ByteDance to divest TikTok or

face

ban

By Arriana McLymore and Sheila Dang

NEW YORK, Dec 7 (Reuters) - U.S. TikTok users spent

heavily to buy merchandise from a range of vendors on the

e-commerce platform TikTok Shop so far this holiday shopping

season, according to TikTok estimates and a Reuters analysis of

spending patterns measured by data from Facteus.

The patterns show that TikTok Shop, which launched in the

U.S. in September 2023, has likely gained market share in

e-commerce at a critical moment. TikTok Shop serves as an

e-commerce channel for major brands such as e.l.f.

Cosmetics, Ninja Kitchen, among other products.

TikTok Shop said in a press release in late November that

its sales had reached $100 million on Black Friday, the day

after Thanksgiving, when bargain-hunting American consumers

spent heavily online. Previously, it said the number of people

purchasing goods on TikTok Shop each month had nearly tripled.

Reuters could not independently verify its claims.

A U.S. federal appeals court on Friday upheld a law

requiring Chinese-based ByteDance to divest TikTok in the U.S.

by early next year or face a ban. A ban of the popular short

video app, if it happens, could extend to TikTok Shop, too.

"TikTok Shop is a new distribution channel and brands are

doing really well on it," said Erik Huberman, CEO of marketing

agency Hawke Media, which has clients that sell products through

the feature. "Honestly, there isn't an alternative. It will be a

lost revenue stream."

Like its rivals Shein and Temu, TikTok Shop

showcases merchandise from third-party vendors, some which ship

items from China, competing fiercely on price. Each of the

platforms have tried to lure more U.S. sellers with lower fees

to help with shipping speeds.

Capitalizing on the popularity of the TikTok social media

app, TikTok Shop merchants typically use ads and sponsored

"influencers" to market their products to TikTok's 170 million

U.S. users.

Merchants on TikTok Shop fulfill shoppers' orders directly,

sometimes using third-parties or TikTok's e-commerce fulfillment

services.

For shoppers like Jasmine Whaley, 31, of York, Pennsylvania,

TikTok Shop has provided a new place to find clothes, skin care

products and Crocs. She's spent almost $700 on the platform this

year after seeing videos from influencers and advertisers about

merchandise.

TikTok has "cracked the code" on curating content and

products that she likes, Whaley said. Her TikTok Shop orders

often are delivered to her more quickly than orders she places

on Amazon ( AMZN ), she said.

For merchants and influencers, TikTok Shop offers what it

calls "LIVE," live-video streams from which shoppers can

purchase merchandise directly.

Nico Le Bourgeois, head of U.S. Operations for TikTok Shop,

said in a statement to Reuters that the number of Live sessions

hosted monthly has nearly tripled over the past year in the U.S.

According to third-party data firm Facteus, U.S. spending on

TikTok Shop exceeded spending on Shein and Temu in the

seven days leading up to Cyber Monday, Dec. 2, a heavy online

shopping day. Facteus said its data comes from 140 million

consumer debit and credit cards representing 7% to 10% of all

U.S. spending.