Short-video social media platform TikTok may be on the verge of challenging Amazon on its home turf with plans for logistics and fulfillment services. More than a dozen job openings posted on LinkedIn over the last two weeks showed intent for an eCommerce supply-chain system that could directly rival Amazon. The move underscores the company’s commitment to eCommerce as a significant driver for growth.
TikTok’s ads business has recorded explosive growth in the US over the last few years. The firm may now be looking to magnify the TikTok Shop experience by bringing warehousing, delivery, customer service returns, and related services to its customers.
Focus on Cross Border Reach
While the advertised positions are US-based, the company is looking to build an international eCommerce fulfillment system. The recruitment posts cite international warehousing, supply chain systems, and customs clearance for domestic and cross-border eCommerce activities. Further implementations would include parcel consolidation, goods transportation, and managing free returns.
Building its own eCommerce supply chain ecosystem could give the company more control as well as allow it to boost profits within the US and around the world.
“The workflow will be like this. An internationally famous creator has established a major following on the network and is now partnered with manufacturers and wants to give exclusive drops to their fans worldwide. These creators are not necessarily international retailers but need to act like them,” thinks Rick Watson, a Strategy Consultant who analyzed this development on LinkedIn.
Still – it’s not all copycat. It doesn’t appear that the company plans to build a transportation unit like Amazon. This means the future might include partnerships with vendors in order to address shipping, parcel consolidation, and transportation.
The Shift to Social Commerce
Live commerce has been one of the most dominant trends in the eCommerce sector. This technique (which has been fueled by the pandemic since 2020) – entails using content creators and influencers that consumers trust to promote products. Brands that utilize live stream shopping have seen an entertainment-based shopping experience that improves product understanding and engagement. This in turn helps drive sales and brand loyalty for the vendor sponsoring or hosting the live stream.
According to LinkedIn user Brian Eddy, ‘path to purchase’ is one key reason why brands are choosing direct-to-consumer strategies.
Could TikTok succeed where Meta has failed?
For quite some time now, TikTok has been exploring a live shopping launch in the U.S. It made a deal with Shopify last year to pilot a shopping feature in the United States along with Canada and the UK. More recently, there have been reports the firm is looking to partner with U.S. live commerce platform TalkShopLive to launch a similar service in the U.S.
But just how does the company plan to conquer the U.S. market? Especially given its botched live shopping launch in the UK – and more so at a time when both Facebook and Instagram have unceremoniously folded their live-stream shopping ventures.
Dean Ferrari is in charge of product at LOGIE and is excited about developments in the space. He thinks it all narrows down to lessons learned from the success of live commerce in the company’s Chinese backyard.
“When analyzing these developments and other similar news, I think TikTok is trying get ahead of the competition and cut a niche for itself in the social commerce space. Meta’s attempt appeared to be lackluster and not as ‘all-out’ as one would have expected. So, when you think about ByteDance’s (TikTok’s parent company) Chinese grounding; where social commerce has seen immense success and set an example for the world – it makes a lot of sense. I think the company has a strong conviction that this area is going to see massive success in the U.S. and is thus positioning as such,” asserts Mr. Ferrari.
Rick Watson adds via a LinkedIn post that “TikTok will need to set standards and build connectivity to all players — including Amazon Logistics, Shopify Logistics, Maersk, Flexport, and many others.”
Let us know of your thoughts on live commerce and developments that are shaping the industry. Which moves pack the biggest punch? Which players are winning or losing? The comments section below is all yours.