TikTok is often invoked in discussions about the next “x” (insert theme). That includes “social ad channel” among other things, given the brand advertising tools and Snapchat-like lenses and filters it’s only starting to roll out. But in that same commerce-oriented breath is eCommerce.
This is the thinking behind TikTok’s new partnership with eCommerce powerhouse Shopify. Listings from Shopify’s one million merchants now have amplified-distribution to TikTok’s 100 million users. That includes qualitatively-greater reach as well as quantitatively-unique access to TikTok’s Gen-Z base.
More specifically, the way this will play out is that Shopify merchants can create and manage TikTok marketing campaigns from the familiar haven of their Shopify dashboard. Once they activate the TikTok channel app from Shopify’s App Store, they can tap directly into TikTok’s Business Ads Manager.
At launch, Shopify merchants who activate this channel will be able to create ads that apply their existing product images, and link back to their stores. They’ll also be able to track conversions and target TikTok users by demographics and behavioral profile; or apply contextual targeting for video categories.
The ads themselves are automatically formatted into native TikTok in-feed video ads, which should help them to integrate naturally into the UX. The level of that integration will expand over time and could include other in-app shopping functionality like letting users buy items directly from an influencer video.
Shopify’s TikTok channel launches this week for merchants in the U.S, followed by other markets in 2021 including, Canada, Europe and Southeast Asia. To kick off the partnership Shopify is offering merchants a $300 TikTok ad credit to get started with the program and develop the workflow “muscle memory.”
This deal marks the second big channel relationship that Shopify has established in the last four months. As we’ve examined, its partnership with Walmart let it tap into the scale of the Walmart Marketplace. This gives its merchants significantly-more reach which can boost perceived value, ROI and retention.
After the success of that Walmart program, Shopify has the taste of scale in its mouth — beyond the notable scale it already achieves on its own. TikTok is next on the list of scale-boosting channel partners, and we predict that more will emerge in the coming months (we’re looking at you Snap).
These channel partnerships also follow closely behind Shopify’s own user-facing app launch. It similarly has the goal of boosting the reach and distribution potential of its merchants. These merchants are Shopify’s core constituent, so most of its ongoing moves trace back to the goal of keeping them well-fed
This driving force for Shopify has higher stakes in the current eCommerce boom. As we examined yesterday in light of PinnacleCart, eCommerce has seen 30 percent year-over-year growth. After hovering around 10 percent of U.S. retail spending for the past decade, it’s now at about 15 percent.
We’ll continue to keep a close eye on the rapidly evolving state of eCommerce, especially TikTok’s “wild card” status, and Shopify’s continued conquests to gain more distribution scale.