The Rise of TikTok eCommerce & Advertising

TikTok has been integrating eCommerce and advertising into the app to appeal to its millennial and Gen Z audience.

By: Katie Melissa

TikTok eCommerce has grown rapidly during the pandemic, with more than 100 million monthly active users in the US and 732 million globally. Moreover, the platform’s U.S. advertising business has exploded growing more than 500% in the past year. While its main source of revenue is advertising, TikTok has been integrating shopping into the app to appeal to its millennial and Gen Z audiences. The company asserts that 47% of its users claim they have bought a product they’ve seen on TikTok.

Many have dismissed the platform as silly due to the misconception that the demographics of TikTok’s user base are largely teens. In reality, the company says only 17% of its audience is aged 13 to 17, while 42% is 18 to 24. This distinction is meaningful. 

Amazon influencers and affiliates are earning 3-8% commissions on purchases made by their followers shopping through their related affiliate links. These commissions add up when you have millions of followers and you’re promoting a product. The app is becoming a place where people discover new products through the hashtag #TikTokMadeMeBuyIt, boosting brands and increasing awareness and sales.

Now, more and more brands want to advertise on TikTok to reach new and broader audiences they wouldn’t have reached elsewhere. The new ad formats, which are in the process of being rolled out, let brands showcase their products, retarget consumers with products they've shown interest in, and highlight sales and promotions. The new formats include:

  • Collection Ads, where brands can combine their product catalogs and branded videos to lead people to product landing pages.
  • Dynamic Product Ads, which automatically retarget people with products according to their online behaviors.
  • Promo Tiles, which allow advertisers to add customizable sales and promotions to their in-feed ads.
  • Showcase Tiles, which lets creators promote products in their videos with a link to them in tiles below for users to purchase.

Elite Automation is an end-to-end management platform to build your online eCommerce store. Our founder, partners, and management team are sellers with decades of experience and millions in sales collectively. We stay on top of market trends and continually adapt for our clients. Additionally, we are well-connected to major influencers on TikTok and other social media platforms. 

Throughout 2021 we plan on implementing new strategies with influencers to increase our client store's profits even more. Want to learn how we can help you start your own Walmart Store or Amazon FBA business? Schedule a call and we’ll get back to you!