If you’re selling on TikTok Shop, or if you consider doing it, you’ve probably heard the big news: Referral fees will increase from 2% to 8% per transaction. TikTok Shops will also cut some of the subsidies they previously offered. While some immediate reactions following the announcements were dramatic, with people claiming the death of TikTok Shop, I feel that most people still see the platform as a viable channel.
My opinion is that TikTok Shop is a unique channel, with a strong value proposition. The lower fees were a tactic to increase the number of sellers on the platform and grow the marketplace. However, it isn’t for every business and some will be more impacted by the new fees than others. I also believe that the importance of the subsidies cut was downplayed, and will have significant consequences this year.
Let’s see how these fees compare with other marketplaces and what I think will be the consequences for businesses.
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