As the reigning North American e-commerce market champion, Amazon faces a new challenger: TikTok Shop.
TikTok Shop has consistently garnered attention since its official launch in the United States on September 12, 2023. According to reports, the daily sales volume of TikTok Shop in the United States and Japan is currently around $7 million. In comparison, Amazon’s daily sales volume was approximately $603 million. Although there is a significant difference in sales volume, Amazon does not hide its wariness of TikTok Shop.
Launch “Inspire”
To maintain its dominant position in the e-commerce sector and prolong user engagement, Amazon has launched a short video feature called “Inspire,” mirroring the style of TikTok. Like TikTok, users can browse product images and videos recommended by Amazon within the app and directly make purchases of the items that interest them.
According to Amazon, users have viewed over one billion product posts since the introduction of Inspire. However, the success of short video-driven sales may not be a perfect fit for Amazon. Most users turn to Amazon to purchase goods rather than browse videos. Amazon earns commissions by promoting products through social media influencers and relies heavily on platforms like TikTok and Instagram.
Compete for Social Media Influencers
Since 2017, Amazon has launched the Influencer Program, using generous bonuses to attract creators. For some, Amazon’s lucrative incentives have been enough to replace regular full-time jobs.
According to data from research company Marketplace Pulse, since 2019, the number of views on TikTok videos promoting Amazon promotions has doubled yearly, with related videos surpassing 400 million views by July of this year. Amazon has recently started providing influencers with more analytics tools to make tracking traffic and online sales easier.”
Summary
There is a mutual competition and imitation dynamic between Amazon and TikTok Shop. Amazon attracts users by introducing a short video feature called Inspire, similar to TikTok, while also vying for social media influencers. Meanwhile, TikTok Shop is actively building its brand image, aiming to be a trusted shopping choice for users.
Despite achieving some success in the short video domain, TikTok Shop needs to establish a logistics supply chain that can rival Amazon.
Amazon and TikTok Shop employ different strategies and have distinct advantages in the e-commerce sector, indicating that the competitive landscape will likely continue evolving.