Is Selling on Tiktok Shop Worth It in 2024

Thinking about selling on TikTok? In this easy-to-follow guide, we'll dive into whether it's a good choice for your business. Find out the advantages and challenges of using TikTok to sell products and see how it compares to other platforms. Let's explore the world of TikTok selling together!

As of 2023, TikTok had over 1 billion monthly active users globally. This figure underscores the platform's immense popularity and reach, making it one of the most widely used social media applications in the world. The app's user base has been growing rapidly, attracting a diverse audience across various regions and demographics.

TikTok has approximately 143 million active users in the United States. This is a very large number, especially considering their very captive audience. Social media, throughout the last few years, has continued to grow and become a place to get lost, relax, conduct research, read the news, get a few laughs, and more recently SHOP.

Will TikTok Shopping Overtake Amazon?

Let’s compare the two in a more in-depth look:

TikTok's e-commerce and shopping integration has been successful, with a significant portion of its users engaging in shopping activities on the platform. For instance, 71.2% of TikTok shoppers reported making a purchase when they found something of interest, and 58% used TikTok as a source of shopping inspiration. Moreover, 55% of TikTok users have bought something from a brand after seeing their products on the app, and 50% made a purchase after watching a TikTok Live. These statistics indicate a high level of engagement and purchasing activity among TikTok users

For Amazon, we know that it has a vast user base, with over 200 million people enrolled in Amazon Prime as of the first quarter of 2023. This indicates a significant level of engagement, as Prime members typically spend more time and money on Amazon than non-Prime members. In fact, Prime members on average spend $1,400 annually on online shopping. By the end of 2022, it was estimated that 67% of all US households had a Prime membership, highlighting the platform's extensive reach.

When it comes to the average order value, this can vary widely on Amazon depending on the product categories and the type of buyers. Prime Day statistics, for instance, have shown that consumers are willing to spend significantly during special sale events. The average annual spend of Prime members ($1,400) gives some indication of the platform's ability to drive sales. We do not have the data yet available for TikTok, but believe it to be less than that of the average spend on Amazon, at least for the time being.

Regarding the number of households with an Amazon account versus a TikTok account, as mentioned earlier, 67% of US households had Amazon Prime memberships by the end of 2022. While specific numbers for TikTok accounts per household are not readily available, it's important to note that TikTok's user base consists largely of a younger demographic, and its use might not be as evenly distributed across households as Amazon's services. When you take into consideration the amount of people with TikTok one can have several assumptions.

This data highlights the different strengths of each platform. Amazon's large and committed user base, exemplified by its Prime members, demonstrates its power as a sales and e-commerce platform. In contrast, TikTok's strength lies in engagement and content interaction, which can be critical for brand visibility and marketing.

Which Platform is Better for Shopping - Amazon or TikTok?

The Power of TikTok in Market Reach and User Engagement:

TikTok has revolutionized social media marketing with its massive global user base and unique short-form video content. It excels in reaching younger demographics and creating viral content, offering unparalleled opportunities for brand visibility and awareness. The platform's algorithm is exceptionally effective at distributing content quickly and widely, making it an ideal space for brands aiming to make an instant impact.

Amazon Seller Central: A Marketplace for Serious Buyers

Amazon Seller Central, on the other hand, caters to a more intent-driven customer base. Visitors on Amazon are often in a ready-to-buy mindset, leading to higher conversion rates for sellers. This established e-commerce platform provides a more direct link between marketing efforts and sales, a feature less prevalent on social media platforms like TikTok.

Challenges in Brand Building on TikTok:

While TikTok's dynamic environment fosters creativity, sustaining a long-term brand presence on the platform can be challenging. The focus on trending content means that consistent effort is required to maintain relevance, which might not always align with long-term brand-building strategies. TikTok is also a point of contention for many parents and politicians around the country. There is a very high risk of being shut down at some point by the US government, specifically 3-letter agencies, because TikTok is regarded by many in the intelligence community as Chinese Spyware. The parent company, ByteDance, is 20% owned by Chinese investors, 60% by other global investors, and 20 % by employees. Many assume the CCP is involved with backdoors into the app, which makes its future in this country uncertain.

Amazon’s Tools for Brand Building and Protection:

Amazon offers comprehensive tools for brand building and protection, such as the Amazon Brand Registry. These tools help safeguard intellectual property and establish a credible brand presence, which are key components of long-term brand success and customer loyalty. The brand-related tools on TikTok are not as good, and not as Ironclad. The trademark and counterfeit preventative tools that exist on Amazon as the backbone of the brand registry are not available on TikTok.

The Unmatched Logistics and Fulfillment Services of Amazon:

Amazon's Fulfillment by Amazon FBA service is a game-changer for sellers, offering access to a vast logistics network. This not only ensures fast and reliable shipping but also significantly enhances customer satisfaction, a crucial aspect of successful online selling.

Superior Customer Service on Amazon:

Amazon's customer-centric approach, with its emphasis on easy returns and refunds, builds a strong foundation of trust and loyalty among customers. This level of customer service is often hard to match for businesses operating independently on platforms like TikTok. Honestly, the Amazon level of customer service and trust cannot be beat…

TikTok's Role in Trendsetting and Virality:

TikTok's influence in creating viral trends cannot be overlooked. Brands that effectively leverage these trends can experience substantial boosts in visibility and sales. However, this requires agility and a responsive approach to marketing.

SEO Benefits: TikTok vs. Amazon

When it comes to SEO, Amazon's internal search engine is tailored to match products with buyers, while TikTok's strength lies in content virality and engagement. Both platforms offer unique SEO benefits, but Amazon's approach is more directly linked to sales conversion. Amazon does have the benefit of indexing very high on google, which will help both your personal website and the product success through Amazon and Google shopping. Win for Amazon.

Ephemeral Trends on TikTok vs. Amazon’s Stability:

The rapidly changing nature of TikTok can be challenging for brands seeking consistency. In contrast, Amazon offers a more stable platform where successful products can maintain steady sales, supported by robust search and recommendation algorithms.

Why Amazon Might Be the Superior Choice for Brand Owners

In summary, while TikTok presents unique opportunities for quick brand exposure and audience engagement, Amazon Seller Central offers a more holistic ecosystem for sustained brand growth, including brand protection, efficient logistics, and stable sales. Amazon's infrastructure and customer service make it a preferable platform for brand owners focused on long-term business development.

Final Thoughts

Choosing the right platform for selling and brand building depends on a brand's specific needs and strategy. However, for those seeking a comprehensive and stable environment for long-term growth, Amazon Seller Central emerges as a more fitting choice. Leveraging the expertise of a full service Amazon consulting agency can further enhance your strategies and success on the platform.