TikTok challenges Facebook with e-commerce platform

Een smartphone met het TikTok-logo
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The video app TikTok has set its sights on e-commerce to initiate the next phase of its growth. In doing so, the app is going in direct competition with Facebook.

 

Automated commission on products

A number of new applications will go live on TikTok in 2021. This information got leaked to the Financial Times (FT), among other sources. The plans are by no means official, but the video platform has already started informing its advertisers.

 

The most notable of these is a tool which will allow popular TikTokkers to link products they recommend and automatically earn a commission on every purchase made through that channel. Besides, brands will be able to showcase their product catalogue on TikTok.

 

An advertiser quoted by the FT sums it up as follows: "It's 'old school' affiliate marketing." But with an additional boost: TikTokkers can link to any product, even if they do not have a formal partnership with that brand.

 

On a collision course with Facebook

These are all clever things, but they are not innovative. With these novelties, TikTok is mainly entering into direct competition with Silicon Valley giant Facebook, which offers a series of similar tools through its subsidiary Instagram.  

 

TikTok does have some catching up to do. In the industry, the advertising platform is still often regarded as a "work in progress", although it is moving forward at a fast pace. Last week, the video app was able to announce its first deal with WPP, a major advertising agency.

 

1 billion monthly users

In addition, TikTok, which is owned by the Chinese company ByteDance, is still picking up the pieces from its confrontation with former US President Donald Trump. However, with newly elected President Joe Biden, the threat from Washington seems to have subsided and advertisers are no longer worried.

 

After all, TikTok's greatest asset is its enormous user base, which other platforms can hardly reach. In its presentations to advertisers, TikTok itself states that 40 per cent of its users do not have a Facebook account, and even 63 per cent do not have a Twitter profile. Not bad for a platform that has about 1 billion monthly active users.