TikTok to Expand E-Commerce Business to US and Spain
Following prior moves in the UK and Indonesia, ByteDance’s TikTok is now accelerating plans to expand its cross-border e-commerce business. Reports have emerged that it is preparing to explore the Spanish e-commerce market, while several US merchants have participated in small-scale tests of TikTok’s domestic online shopping platform.
TikTok’s e-commerce business kicks off tests in the United States
According to several sources, TikTok Shop US, which has previously experienced various twists and turns, is definitely going to arrive this time. Its launch date will probably be in the second week of November, and a group of local merchants have participated in small-scale traffic tests, according to a report by Chinese media outlet Egain News on November 4. At present, several companies have reached cooperation intentions with TikTok Shop’s US business team. Although there are no restrictions on goods categories, they are required to “be able to deliver goods locally.”
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Affected by local supervision and market conditions, TikTok’s e-commerce team pursues a cautious approach to its actions in the US. The company will focus on recruiting merchants with inventory in the the country. Some of them are local merchants and some are merchants with goods in overseas warehouses. They can therefore provide more stable, safe and quality services for TikTok Shop.
In October this year, several American media reports revealed that TikTok had posted more than a dozen jobs related to logistics and distribution on LinkedIn. This indicates that TikTok plans to build a logistics center in the the US to provide warehousing, distribution and return services for e-commerce sellers, so as to “ensure the rapid and sustainable growth of TikTok Shop.”
TikTok builds a team in Spain
A source close to the firm revealed that TikTok Shop is preparing to enter the Spanish market, according to Chinese media outlet BrandFactory on November 4. TikTok has posted 12 recruitment positions, including Spanish beauty category director, fashion category director and logistics operation director, all of which are based in Madrid.
In terms of the job requirements, beauty and fashion brand executives must have more than 10 years of e-commerce business experience in related fields and more than three years of team management experience. It is also necessary to have a sales-oriented thinking mode, be familiar with TikTok and other content platforms, and to have close contact with brands and distributors.
Earlier, an insider engaged in TikTok-related business told BrandFactory that TikTok’s strategy of exploring new markets has changed. It planned to solve logistics and warehousing locally first, and then start to improve other infrastructure, and local warehouses may be built in Europe and other markets. Recruitment information on a “Spain Logistics Operation Director” released by TikTok confirms this plan.
Spain’s unique economic and geographical conditions may allow TikTok to lay inroads into the wider European market, which the firm has been paying close attention to.
A source said previously that TikTok e-commerce may enter Germany, France, Italy and Spain as early as next year. “Which market to enter first may depend on whether the policy is friendly or not, and then the infrastructure conditions will be considered. At present, it is a strategy for stability. The market explored first may not be the biggest, but it must be the most stable.”
TikTok is full of confidence in its e-commerce business
Apart from the UK, TikTok’s e-commerce business layout is now mainly located in Southeast Asia. In addition to its arrival in Indonesia in 2021, it entered five more countries – Thailand, Malaysia, Vietnam, the Philippines and Singapore – in the second quarter of 2022. TikTok Shop now has seven national sites.
TikTok has always placed high hopes on its e-commerce business. According to a report by Yahoo Finance, TikTok plans to grow its e-commerce gross merchandise volume to $2 billion this year and $23 billion in 2023, according to a person close to ByteDance. The target of 2023 is more than 10 times higher than that of 2022.
However, TikTok’s e-commerce business has not always been smooth. In June this year, the Financial Times reported that TikTok’s UK live-streaming e-commerce business suffered various setbacks.