We reported earlier that TikTok is planning to launch its competitor to Amazon and others with its e-commerce platform known as TikTok Shop. Now, we can report that there is a development in this regards that Amazon and others won’t like because it directly hurts them. We have been made aware that TikTok is planning to ban e-commerce links from outside the platform so that users are forced to purchase products from its own platform as and when it launches.
The Information reports that “TikTok is planning to ban links to outside e-commerce links, such as Amazon” and adds that “The reported move is seen as a way for the company to force people to use TikTok Shop if they want to purchase an item that they see on the app”. The same report mentions that “TikTok Shop is on track to lose more than $500 million in the U.S. this year. The $500 million loss reflects the company’s deep investment in hiring, creating a delivery network and subsidizing merchants that offer discounts and free shipping.”
As per the report, “By banning outside e-commerce links, TikTok would prevent creators from promoting things like kitchen items and furniture that are available on their Amazon storefront. If someone buys an item listed on an influencer’s Amazon storefront, the influencer makes a small commission. With these reported changes, creators would no longer be able to do so”. This could also be a preparation for TikTok’s own TikTok Shop launch which will mean that creators can only link to TikTok Shop products and not make the user go out of the platform.
Also, the report says that “TikTok has been working to attract merchants to its platform. For instance, the company’s employees look at bestselling items on Amazon, then reach out to the merchants to convince them to join TikTok Shop while offering them zero commissions for the first three months”. Obviously, TikTok is on a customer acquisition spree right now for the successful launch of its TikTok Shop in the US so it is quite prepared to spend as much as possible and gain as much ground to Amazon as it can.