I am fascinated by the increasing competition between social media platforms and online marketplaces. In a recent piece, I wrote about the concept of omnichannel e-commerce and how the distinction between sales channels is blurring. However, it seems that figuring out who is engaged in ecommerce and who is doing social media is becoming increasingly difficult.
Rumors suggest that TikTok may ban links to external ecommerce websites like Amazon, which could be another step towards having a significant role in the US ecommerce landscape. Despite projected losses of half a billion dollars in the US this year, TikTok expects to increase daily sales on TikTok Shops from $3 million currently, to $10 million by the end of the year. They have a long way to go if they want to compete with Amazon’s huge catalog, even though they’re making progress in attracting sellers onto their platform.
On the other hand , Amazon is entering TikTok’s domain by introducing a TikTok-style shopping feed. The goal is to drive customer engagement and tap into the #TikTokMadeMeBuyIt audience. While TikTok struggles to offer Amazon’s shopping experience and product variety, Amazon has difficulties attracting influencers and getting users to create engaging content. Amazon was even mocked recently on social media for offering influencers “up to $25” per video.
The outcome is still unclear, especially when TikTok will need to become profitable and potentially charge higher fees for their services. However, observing these two titans continuously reshape the e-commerce landscape is truly captivating.
