Focusing on TikTok Shop's performance in the second half of 2023, TikTok Shop's Southeast Asian "Double 12 Big Promotion" has shown its strong dominance in the Southeast Asian market. With the return of Indonesia, during the Double 12 Big Promotion, TikTok Shop's GMV in Thailand, Vietnam, Malaysia, and the Philippines increased by 925%, 614%, 444%, and 377% respectively, which can be said to be a good answer.
In addition, on November 24 alone, the GMV of TikTok Shop in the US exceeded 33 million US dollars, and the average daily GMV exceeded 12 million US dollars. The amazing sales capacity of TikTok Shop in the US attracted countless cross-border merchants to join. TikTok Shop has become a new outlet for cross-border e-commerce.
With the successful conclusion of 2023, TikTok Shop has set a GMV target of US$50 billion for 2024, which is 1.5 times higher than that in 2023. It can be predicted that there will be more opportunities and challenges for TikTok Shop in 2024.
2023, the curtain of social e-commerce will be unveiled amidst the transformation
On March 23, 2023, the U.S. House of Representatives held a hearing on TikTok that attracted the attention of the world. The five-hour hearing caused many cross-border sellers to slow down their investment in TikTok Shop in the U.S. and adopt a wait-and-see attitude.
But the heated hearing did not seem to stop TikTok Shop from moving forward. In May 2023, TikTok Shop officially announced the launch of the fully managed model. From then on, TikTok Shop sellers only need to be responsible for supply issues, and traffic and operations will be solved by the platform.
On September 12, 2023, the long-awaited TikTok Shop in the United States was fully opened. From then on, TikTok users can directly complete the entire purchase process from seeding to ordering, payment, and after-sales service on the platform. TikTok officially opened the curtain of social e-commerce in the United States.
Image source: TikTok
After TikTok Shop's largest site in Southeast Asia, Indonesia, was forced to close, the TikTok Shop Black Friday promotion officially kicked off on October 27, 2023. This Black Friday is not only the first big promotion event after TikTok Shop's full opening in the United States, but also an important node for it to further open up the US e-commerce market.
On December 11, 2023, good news came from the Indonesian site that worried Southeast Asian sellers. TikTok officially announced a strategic partnership with GoTo Indonesia, and the Indonesian site announced its return.
Looking back at TikTok Shop in 2023, it can be said that it was full of ups and downs and dangers. But even with constant twists and turns, TikTok Shop still firmly opened the curtain of global social e-commerce. In just one year, TikTok Shop has established a firm foothold in Southeast Asia and the United States, and every move has stirred up the local e-commerce market.
This is just the beginning. As TikTok Shop enters the stage of refined operations in 2024, it will surely bring even more amazing results.
Occupying 80% of GMV in the US, Internet celebrities are the biggest highlight
With the release of TikTok Shop’s Black Friday promotion report in the United States, everyone has seen the growth potential of TikTok Shop in the US market.
An industry insider said: "During Black Friday, TikTok Shop GMV exceeded $15 million a day. Even with restrictions on the number of merchants and daily orders, TikTok Shop's GMV in the US increased fivefold in the two months from August to October. It is expected to reach $100-200 million per day by 2024. By then, the US alone will contribute $30 billion in GMV to TikTok Shop."
Among them, the contribution of influencers to its GMV is obvious to all. According to data, about 82% of TikTok Shop's GMV in the US comes from influencers' trailers, 5% from live broadcasts, and 15% from self-operated and shopping malls.
Image source: TikTok
In other words, short videos, live streaming and shopping malls are currently the main sources of GMV for TikTok Shop in the US. Among them, online celebrities using short videos as a carrier account for the vast majority of sales and are currently the fastest way to place orders.
Some merchants in the United States have said that a small internet celebrity can achieve a single sales of more than 30,000 US dollars in a short video, and some internet celebrities can even achieve a single sales of more than one million US dollars. The purchasing power of this scale far exceeds that of Southeast Asia.
From this we can see the great influence of Internet celebrities in the US market. Coupled with TikTok's more than 150 million monthly active users in the United States and extremely high user stickiness, the fission-like propagation of its content itself has enabled more products to become popular in a short period of time by relying on Internet celebrities.
Some merchants even said: "In the US area of TikTok Shop, as long as you find the right local influencer, it is not a problem to get hundreds of orders a day."
Three key points for matching with influencers to help brands seize the TT bonus
At present, the common way to create a hit product on TikTok Shop is generally as follows: the merchant first establishes a connection with the influencer, provides a small number of samples to the influencer, and asks them to try to make content and publish it. After observing the content release situation and judging whether the product has the potential to become a hit, the merchant will prepare a large number of stocks and cooperate with a large number of influencers to mass produce cooperative materials.
Therefore, in the process of creating hot products on TikTok Shop, influencers become a key factor. So on the TikTok platform with a huge user base, how can you quickly screen out the right influencers to bring products to you?
01. Determine the type of influencer
Before starting to match influencers, brands need to understand which type of TikTok influencers are suitable for the product type. Only by finding matching influencers can you accurately reach the audience and effectively guide fans to click on the corresponding products to place orders. For example, for home appliance products, you can cooperate with lifestyle influencers such as Lifestyle and Vlog.
If you are not sure which type of influencer is suitable for your product, you might want to take a look at what type of influencers your similar brands or competitors are working with, and use this as a reference for the types of influencers they are working with.
For example, when a swimsuit brand that focuses on North America chooses influencers, it can refer to high-quality brands in the same industry. For example, the marketing strategy of Cupshe, another swimsuit brand exported to the global market, is shown in the figure below. It can be found that the swimsuit brand exported to the global market mainly cooperates with small and medium-sized fashion influencers. Among them, medium-sized influencers with 50k-500k fans account for the highest proportion and are the most favored type of influencers by the brand.
Image source: Krispy Kreme
02. Confirm whether the influencer has opened the TikTok shopping cart
As mentioned above, currently about 82% of TikTok Shop's GMV in the US comes from influencer trailers. Therefore, when cooperating with TikTok influencers, you also need to confirm whether the other party has opened TikTok Shop permissions.
However, at present, most TikTok Shop merchants in the United States need to cooperate with a large number of Internet celebrities at one time. As for whether TikTok e-commerce permissions have been opened, it is too time-consuming and laborious to contact the Internet celebrities themselves or confirm through the channel homepage. It is best to use tools to improve the efficiency of Internet celebrity screening.
03. Confirm the influencer’s interaction rate
The reason why TikTok Shop in the US region can quickly make products popular through influencers is mainly due to its extremely high monthly active users and user interaction rate. Therefore, when choosing influencers, the interaction rate is also an important factor in judging whether the influencer can achieve the purpose of bringing goods.
However, the interaction rate of an influencer channel cannot be judged by a single number. It also needs to be judged by combining multiple data of the channel. For example, will a million-dollar influencer with an interaction rate of 1% have a worse sales performance than a 10,000-fan influencer with an interaction rate of 10%? In fact, a million-dollar influencer with an interaction rate of 1% has 10,000 fans, while a 10,000-fan influencer with an interaction rate of 10% has only 1,000 fans. In addition, the million-dollar influencer has an invisible influence, so its sales performance is likely to be much higher than that of a 10,000-fan influencer.
Therefore, what we mean by the interaction rate of internet celebrities here does not refer to the "absolute value" of the interaction rate, but the "relative value" of the interaction rate, that is, the interaction rate performance of the internet celebrity among internet celebrities with the same level of fans.
Although the United States is one of the world's largest influencer marketing markets, there are only a limited number of influencers with the ability to bring goods on the TikTok platform. Currently, almost all American influencers with the ability to bring goods are being bombarded with cooperation messages from Chinese sellers, and some influencers even have multiple products waiting to be promoted.
Therefore, Nox recommends that merchants can turn their attention to Internet celebrities with a smaller fan base who are willing to try to bring goods. Although these Internet celebrities have less cooperation experience, they have advantages such as weak bargaining power, low cooperation costs, and high cooperation, and are also a good choice for many merchants.
summary
In 2023, the excellent performance of TikTok Shop in the United States has given a shot in the arm to cross-border sellers who are anxious about the closure of the Indonesian site. It is believed that in 2024, with the development of refined operations of TikTok Shop, TikTok Shop's monetization journey in the United States will continue to accelerate towards the goal of an annual GMV of US$50 billion, and Internet celebrities will still be the most important catalyst.
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