For CEO/CMOs thinking about this, the answer is YES. As of late 2023, there are over 500,000 merchants that sell on TikTok Shop. However, what’s really worth noting is just how much revenue merchants are driving on TikTok Shop!
TikTok is a unique channel in that it both builds awareness and drives sales (unlike Amazon which captures awareness, or Meta/Instagram, which are less effective at larger awareness building but very effective for bottom-of-funnel demand capture). TikTok has the potential to be the next large platform shift in marketing channels, and there are already signs of brands building 8-figure businesses with TikTok Shop as the primary channel of spend.
I mean, just look at the top 10 sellers in the US on TT shop in the last month:
Note that some brands doing well on TikTok Shop are “TikTok shop native” while others are household DTC/omnichannel DTC brands!
At first glance, it makes sense to focus on Gen Z (ages 12 to 27) - almost 45% of TikTok’s user base falls into this age range. This translates to around 75 million potential buyers—whether Gen Z themselves or their parents—out of TikTok’s 170 million U.S. users as of April 2024.
The platform’s easy integration between content and commerce deems it an environment ripe for sales, and early movers are seeing the benefits. So for those who haven’t taken the leap yet, the clock is ‘Ti(c)king’, so to speak!
At this stage, the platform offers enviable advantages:
The Global Opportunity: Launching TikTok Shop in Regional Markets
TikTok’s e-commerce growth isn’t limited to one region. In Europe and Asia, categories like skincare, supplements, and fashion are experiencing a surge in sales driven by TikTok Shop. Across the board, early adopters in these regions are benefiting from local influencers, highly targeted video content, and TikTok’s viral potential.
So for US brands looking to tap into a specific region, TikTok Shop offers a tempting opportunity.
Let’s take the UK as a case study.
Since TikTok Shop’s introduction in the UK, about 50% of UK’s TikTok users reportedly make purchases via the app.
According to OpenBorder’s analysis, US TikTok Shop stores that have expanded into the UK are seeing UK revenue account for roughly 34% of their US TikTok Shop revenue, with a median of 30%.
In the beauty category, the results are just as glamorous—UK stores are driving 30% of US store revenue on average. Notably, the current TikTok Shop leaders in the UK makeup market are local players, who have gained significant traction in a very short period of time.
But of course, expanding into a new market comes with multiple hurdles.
Establishing a TikTok Shop account in the UK requires more than simply duplicating your existing US store.
For instance, you’ll need to:
This becomes particularly complex when managing international supply chains and meeting delivery timelines for UK consumers. For instance, shipping timelines can also be tricky, especially when coordinating with international carriers, which may not meet UK consumer expectations for fast delivery. Additionally, returns pose another layer of complexity, as processing them from abroad can lead to higher costs and slower refund times.
Customers can fulfill in 2 ways:
For TikTok, understanding which local influencers have a good foothold in the UK is key to running effective promotional campaigns that actually convert, because user-generated content is the most authentic medium through which shoppers decide whether or not to buy an item.
Gymshark’s marketing approach makes for an intriguing read.
The UK based gym clothing brand managed not only to break into the US market but also earn a majority of their revenue from the region (£179.6 million in sales).
Gymshark has excelled on TikTok, amassing over 4.2 million followers and 65.7 million likes. Their TikTok strategy emphasizes User-Generated Content (UGC), with the hashtag #gymshark reaching over 8 billion views.
In 2018, Gymshark launched the 66 Days to Change Your Life challenge. Participants set personal goals, shared initial photos/videos, and updated their content after 66 days for a chance to win a year’s supply of Gymshark products.
Launching on TikTok Shop UK requires a significant investment of time and effort if done independently. From setting up compliance to overseeing fulfillment, the DIY approach can stretch a brand’s resources thin. Many brands find that balancing all these tasks takes significant internal bandwidth, leaving less room for growth-focused activities.
That’s exactly why we’ve built this step-by-step guide to help you streamline the whole process for you.
Before you begin, gather the following:
These will be required during the registration process.
Once your business is verified, head to the TikTok Shop Seller Center to create your seller account. The Seller Center is your control hub, where you’ll manage product listings, view order details, track performance, and handle store operations.
You can start adding products even if your account verification is pending.
Consider joining TikTok’s Affiliate Marketing Program. This allows creators on TikTok to promote your products, earning commissions from sales, which can help increase your visibility and sales.
So, you can either sell your products directly or send free samples to creators who’ll make videos showcasing them. They earn a commission for sales generated through their content.
You have two options for collaboration:
The Find a Creator feature helps you match with creators based on their sales and engagement metrics. You can see who might be a good fit based on their past performance.
Another useful aspect is Sample Requests. Creators can request samples of your products, allowing them to create content without upfront costs to you. You can track which products were sent and what content is in progress, making it easier to manage.
Pro tip: Use this Google Sheet to track your progress
Once your store is up and running, you’ll want to test different content types, pricing strategies, and ads. TikTok’s analytics dashboard provides insights into what’s working and what isn’t, allowing you to optimize your strategy continuously. Conduct A/B tests to see which content resonates best with your audience and fine-tune accordingly.
The simplest way to get started: create videos that directly link to your products. It’s quick and effective. Shoot a video, add the product link, and post. Users can buy straight from your video, making the sales funnel almost instant.
Live shopping is still catching on in the US, but it’s huge in other markets. You can showcase products in real time, engage directly with your audience, and pin products for immediate purchase during the live session.
The Shop Tab is where users browse and discover new products. Ensure your product is listed here, optimize the title, and consider running ads to promote visibility.
Pro tip: You can also create deals and flash sales that are featured in TikTok’s “Deals Tab.” This helps get your product in front of users already looking for discounts.
Of course you can post videos daily, but make sure you’re also utilizing TikTok’s affiliate system. Good affiliates create content that sells, and you can run ads on these videos using a Spark Code.
Be smart about who you partner with. Give your product to creators who have the potential to drive sales, not just anyone. The right content can be a game changer.
Once you have great user-generated or affiliate content, don’t just leave it there. Use the Spark Code to get ad rights and run ads behind those successful videos. More views = more conversions.
TikTok Shop is rapidly growing, with millions of active users and early-mover advantages for brands. The platform is incentivizing spending to seed their platform, offering low CPMs and significant exposure potential. For some categories like supplements, skincare, and jewelry, TikTok Shop has already proven to be a profitable channel.
While TikTok Shop may not be the biggest sales driver compared to channels like Amazon, brands that get in early can build their flywheel and capture valuable organic traffic. Having a strategy that includes multiple channels will help brands maximize their reach and sales potential.
As TikTok looks to aggressively establish credibility as an advertising platform through a select set of leading US brands, there couldn’t be a better time to capture meaningful CPM arbitrage and entrench yourself as a market leader in the UK!
Ride the wave - Launch TikTok Shop UK with OpenBorder
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