TikTok Shop has rapidly gained traction despite entering the market late.
Launched in the United States in 2023, it has attracted 47 million shoppers who collectively spend $32 million daily, according to Capital One Shopping.
The platform combines Temu’s low prices with the social shopping experience of Instagram and Facebook, making it a formidable player in e-commerce.
In 2024 alone, TikTok Shop gained an estimated 11.9 million U.S. buyers, surpassing competitors like Meta and Pinterest during the same period, according to Emarketer.
“All these companies should be real nervous because TikTok Shop starts from this huge strength of customer retention,” said Jason Goldberg, chief commerce strategy officer at Publicis Groupe, a marketing firm.
Unlike other social shopping platforms, TikTok Shop keeps buyers within its app, while competitors like Instagram direct shoppers to external websites for purchases.
TikTok also leverages its algorithm to recommend products just as it does content, showing ads based on user engagement habits rather than just shopping behavior.
“Every time you look at something, every time you pause on something, every time you click or swipe on something, that’s cutting code in the background on this algorithm and making it smarter,” said Richard Crone, founder of Crone Consulting, an e-commerce firm.
In April 2024, Congress passed a law mandating that ByteDance, TikTok’s China-based parent company, sell its U.S. operations to an American firm or risk a ban.
Lawmakers argue the app poses a national security threat, a claim TikTok denies.
The app briefly went down for a few hours before the law’s initial January deadline, but President Donald Trump granted a 75-day extension through an executive order.
ByteDance now has until April 5 to secure a U.S. buyer.
