TikTok: The Next Player in eCommerce?

Key takeaways

• 79% of consumers think TikTok Shop will take business away from Amazon.
• The biggest draw to paying for a premium TikTok membership would be free shipping. 
• Consumers are willing to spend an average of $12 a month on a TikTok Shop premium membership similar to Amazon Prime.
• 92% of small-business owners plan to include TikTok Shop in their marketing strategy. 

Coming soon: ordering packages from TikTok Shop

You know about TikTok’s memes, dances, and dares. But soon, this popular social media platform will expand its services to include shopping.

The company hasn’t revealed all that’s to be included, but consumers expect its features and services to rival those of Amazon.

With another source for order fulfillment and deliveries on the horizon, what does it mean for shoppers and businesses? We asked over 1,300 sellers and customers to tell us what they hope the future of TikTok holds for them.

What customers want

Consumers expect a lot from their favorite online shopping sites. What TikTok Shop should offer depends on who you ask.

In good news for eCommerce businesses, TikTok plans to open US fulfillment centers so they can store goods, get them to consumers quickly, and offer easy returns.

In fact, the model looks a lot like Amazon’s and may include similar features like package tracking.

But we found that different age groups have different expectations for the new TikTok offering.

Younger shoppers (Gen Zers aged 18 to 24) want an option similar to Amazon Prime that streams original content. Gen Z also anticipates using TikTok Shop the most out of any generation surveyed. Meanwhile, millennials (aged 25 to 41) hope for the free shipping they know and love with Amazon.

And online businesses may not want to focus on baby boomers (Americans aged 58 to 76) when it comes to marketing on TikTok. They’re expected to use the app less than anyone else to do their online shopping.

Those willing to pay for a Prime-like subscription on the platform found $12 a month to be a fair price, on average.

With Prime costing $14.99 per month, it’s no wonder nearly 80% of consumers expected a similar service to cut into Amazon’s share of the market if TikTok were to offer it.

But the amount people would pay for a premium membership varied by generation. With baby boomers willing to spend the most for a TikTok alternative to Prime: up to $15 a month.

Consumers are clearly excited about trying out TikTok Shop when it becomes available to customers in the US. But 39% said they’d only subscribe if they could first do a free trial. This was of equal importance to Gen Xers and millennials.

Baby boomers are more open to buying sex toys on the app than any other generation with theoretical TikTok Shop purchases. They were also 30% more likely than Gen Z to buy medical marijuana on TikTok and 20% less likely than Gen Z to use it to buy prescription medications. 

These findings suggest that baby boomers feel more comfortable buying items for intimate or personal use online. Why? Maybe they value their privacy more or feel more embarrassed when making certain purchases in person.

No matter the reasons for differences between generations, only time will tell what products and features will be available on TikTok Shop and how much it will end up costing users. 

Key takeaway: Whether consumers want a new way to buy sexy gifts or stream their favorite shows, TikTok Shop may be used differently by generation.

What do brands want?

Businesses of all sizes may benefit from social media marketing, and TikTok is no exception.

Let’s find how entrepreneurs think a TikTok shopping experience will affect their business.

It’s no secret that social media influences shopping with trends from outfits of the day (OTD) to recipe challenges.

That’s probably why the business owners we surveyed saw TikTok Shop as a new avenue to expand their digital footprint.

Brands that engage TikTok users have a direct line to eager shoppers for a much lower cost than traditional television or print advertising.

Maybe that’s why medium-sized businesses were willing to invest 69% of their marketing budget into this newer ad platform.

These businesses were also 5% more likely than smaller businesses to include TikTok Shop in their marketing plans.

Key takeaway: Medium-sized businesses were more interested in using TikTok Shop for marketing than smaller businesses.

TikTok’s possibilities for consumers and brands

Our study reveals that people will embrace TikTok’s upcoming shopping tool, especially if it offers the products and features they know and love.

Many consumers want free shipping or to stream original content, much like what they already enjoy with Amazon Prime. 

eCommerce business owners are also eagerly anticipating the new shopping platform. Most saw it as good for their brand and wanted to budget it into their marketing plans. 

With so much interest from sellers and consumers alike, TikTok Shop might just be the new Amazon!

Methodology

Between two surveys, we explored consumer and business owner sentiment towards TikTok Shop. We had 1,358 responses (1,009 from consumers and 349 from business owners) in total.

About Circuit for Teams

The TikTok shop launch likely means more people doing more of the online shopping they love. Circuit for Teams helps you keep tabs on all your customer deliveries and optimize the fastest routes for multiple drivers.

Fair use statement

If you found our TikTok Shop insights useful, please feel free to share them or use them for noncommercial purposes. We only ask that you give a link to this page.