Since TikTok’s creation, huge brands have been flocking to the site to promote products and services. In the UK specifically, TikTok has become a staple for ecommerce businesses with its sales last year having grown 93% year on year, making it the perfect place for businesses to run their e-commerce businesses. This success isn’t surprising, as the platform has offered consumers a new way to find products they like and purchase them in real-time. We have seen platforms like Instagram try to replicate this with only a fraction of the success.
With so many businesses joining the app every year, it has become its own powerhouse in the e-commerce industry in the UK with its high engagement rates and its unique selling formula, which combines selling with entertainment and endless scroll features. This has affected the e-commerce industry significantly, with more businesses making a complete transition to TikTok shops to maximise their success.
In this guide, we investigate how the algorithm works and the impact that UGC has had on generating more sales. Continue reading to learn more about the platform.
TikTok’s Unique Marketing Features
TikTok’s unique features help to explain its success as an entertainment platform and an e-commerce platform, and why businesses have flocked to TikTok to sell and distribute products.
Algorithm Discovery
TikTok’s sensitive yet accurate algorithm can be thanked for its overall and e-commerce success. Rather than videos and products being pushed out to those who have no interest at all in them, the algorithm ensures that videos are delivered to those who are specifically interested. This can be someone interested in HGV lessons getting TikToks for an HGV course. This accurate targeting can organically reach a qualified audience, making the chance of sale or engagement higher.
In addition to this, the high chance of virality on TikTok can make it easy for small businesses with a low budget to become big overnight, leveling the playing field. When products are linked on these TikToks, this makes the checkout process smooth and quick, lowering thinking time and cart abandonment rate.
Influencer and Creator Economy
Influencers and creators, although not specifically unique to TikTok, are a key feature of the app. Because of the high chance of virality, TikTok has thousands of influencers and micro influencers with loyal audiences, which is great for companies to give or pay to promote products. Not only does it target specific performances, but it also provides a more authentic way to advertise that can resonate more with users and potential buyers.
Impact on Consumer Behaviour
TikTok has had a huge effect on buying habits. When at one time, consumers may have had to follow a link to leave a site or even leave the house to buy a product, TikTok shops’ in-app feature has meant that consumers can buy products with a few clicks, furthering impulse buying. Alternatively, the virality aspect of TikTok has created a culture of trend hopping with trendy items, with the hashtag ‘TikTok made me buy it’ further promoting the products, especially as they are recommended by peers.
Challenges for E-Commerce Businesses on TikTok
It’s not all plain sailing for e-commerce businesses on TikTok though, as there are challenges that they’ll need to overcome. There is a lot of competition on the platform with there being over 8 million businesses with an account, so it can be difficult to get noticed if you’re a startup.
Traditional ads won’t work on TikTok either, which means that polished ads will need to be replaced with authentic user-generated content (UGC) that matches TikTok’s 5-second brain style. Failing to produce this type of content can result in low engagement, as TikTok consumers won’t feel connected to your business and the products you produce.
TikTok also provides limited access to customer data, making it difficult for businesses to analyse behavior or build long-term relationships. This is a weakness compared to SEO campaigns, for example, which allow you to track your progress on GA4 and Search Console so you know how many users you’re getting and the revenue you’re generating.
Also read: How to Start an eCommerce Business from Scratch
The Future of Social Commerce on TikTok in the UK
Live shopping has become a major revenue driver, with brands getting higher conversion rates through interactive, real-time sales when compared to clicks on Google SERPs. This is because they are reaching an audience that will actively be interested in their products and complete purchases.
When it comes to TikTok, it has truly opened the door for businesses to reach a niche market with growing success. Brands are leveraging this platform to blend entertainment with creating a seamless shopping experience, as users on the platform can watch your UGC and then click onto your products to complete fast purchases. The platform contributes roughly £1.6 billion to UK GDP with this number looking to continue to grow for the foreseeable future.
Also read: 7 Tips to Become TikTok Famous