How TikTok and Shopify are Maximizing E-Commerce Revenue Options
Over the past several years the way we shop has changed dramatically. As social platforms evolve into the new-age shopping malls, a trend largely fueled by the pandemic, consumers will continue to prioritize relationships with brands based on the online experience they provide every step of the way.
In this spirit, in October 2020, TikTok and Shopify announced a global partnership geared to help more than one million merchants reach highly engaged audiences and drive sales by tapping into TikTok’s global scale. Today, they announced new tools and integrations to expand revenue options for retailers and enhanced brand-consumer experiences.
Faster, more efficient, and secure payments
In 2020 Shopify’s Shop Pay helped buyers complete more than 137 million orders in 2020, and by the end of the year, had facilitated nearly $20 billion in cumulative gross merchandise value (GMV) since its launch in 2017.
To help facilitate even greater usage, the company is teaming up with Facebook so retailers selling with Shops on Instagram and Facebook can leverage the tool. In case you’re unfamiliar, Shop Pay functions akin to Amazon’s One-Click purchase product. In this case, users will have the ability to save their email address, credit card, and shipping and billing information in the app so that they can complete their transactions faster and more efficiently whether they are browsing through Facebook or Instagram.
“Through our continued work with Facebook, we’re excited to combine the best in commerce with the power of community, extending the benefits of Shop Pay to even more people buying and selling with Shops on Instagram and Facebook,” Shopify wrote in the official announcement. The article also noted that checkout on Shop Pay is 70 percent faster than a typical checkout, while it also sees a 1.72x higher conversion rate.
Convenient order tracking and sustainable shopping options
According to a recent Twitter report on customer care, seventy-eight percent of retail brand handles that excel at customer support take ownership of customer problems in order to build trust. A significant piece of this involves personalized customer support such as a convenient way to trace and manage the tracking of orders.
“With 430+ million orders tracked over 450 billion miles, our global order tracking service enables consumers to track all of their important purchases, receive updates, and manage orders,” shared Shopify.
Aside from ease and convenience, people are embracing social commerce for the greater quantity of options available that align with what matters most to them. For a large portion of consumers, shopping sustainably is a top priority with making these decisions. Per Shopify, over half (53%) report that they prefer green or sustainable products, which is why Shop Pay offsets 100 percent of the delivery emissions for every order.
Establishing more direct connection between creators and monetization opportunities
TikTok made its foray into the e-commerce world with integrations with Shopify and Walmart late in 2020. Today, the platform’s looking to take its efforts even further with several new tools to facilitate more e-commerce opportunity and maximize its revenue options. according to a new report from The Financial Times the platform briefed advertisers on three new forthcoming updates coming soon to the app. These include:
- A tool that lets its most popular users share links to products and automatically earn commission on any sales
- The ability for brands to showcase catalogs of their products on the platform
- “Livestreamed” shopping, a mobile phone version of television shopping channels, where users can buy goods with a few taps after seeing them showcased by TikTok stars
The push around presentation and experience enhancements is a smart and welcomed one according to several statements shared with FT.
“The product and the content has not matured into a place where sophisticated advertisers really want to commit,” one ad agency executive said. With added features to help simplify listings and formalize commission processes as well as those to deliver on an in-app showcase, this could be the nudge some advertisers are waiting for in order to pull the trigger.
“Culturally, TikTok is well placed for livestreamed commerce to capture the dissolving distinction between content and commerce because it doesn’t feel as polished as other platforms,” added Jack Smyth, Creative Technology officer at WPP’s Mindshare.
While the platform faced a tumultuous and uncertain 2020, one thing is clear – in order to keep its biggest creators, it needs to ensure that they can generate similar income to what they’d be able to on other, more established and lucrative platforms.
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