TikTok Coming For That Number One Spot

Marketplaces
Written By Rick Watson

TikTok increasingly is coming for a number of companies at the same time:

* Amazon (TikTok: funding their own Black Friday deals, partner/build fulfillment infrastructure)

* Shopify (TikTok: Building Storefronts for entrepreneurs that cannot link to off-platform stores, their own shopping destination which Shop App would have loved to become)

* Google (adding Wikipedia links into its feed, and increasing usage as general purpose search)

Shopify continues to discuss its previous partnership with TikTok in the past month, but I feel there is more tension there than is being let on.

TikTok is such an asymmetrical competitor that most observers are not even sure how to classify them. Meanwhile, their discovery algorithm continues to pull away from the competition. For users, it is about attention. I think the only one who sees this coming is Elon, who is desperately trying to do what TikTok is doing:

Become the Everything App

If there was one app that monopolized most user attention, it could increasingly command higher revenues from partners to appear in its feed, charge brands and retailers higher advertising rates, and become a shopping destination. The latest move with Black Friday deals is interesting, here are a few notes on it:

* Subsidizing up to 50% discounts starting October 27th

* Going to be funding deals throughout Black Friday and Cyber Monday

Very soon, #tiktokmademebuyit will not be something you think is on Amazon. TikTok Shop rolled out in the US last week, I wrote about recently.

Increasingly, TikTok is setting up a virtuous circle:

* Ways for creators to sell directly (TikTok Shop), and an ecosystem of app partners to connect to software (TikTok App Store)

* Ways for influencers to get paid for referring other TIkTok creators, rather than general-purpose websites (self-referring affiliates)

* Enabling creators to fulfill if they need this assistance.

* Funding great discounts on online, encouraging consumers to shop.

* Increasing user minutes spent

* Continuously improving discovery algorithm

Indeed, the North American market may not have seen anything like this at scale.

The reason it could all work? TikTok is not chasing attention — their attention minutes are growing. And for a marketplace business, that’s the foundation of success - providing services to fulfill that demand.

Rick Watson

Rick Watson founded RMW Commerce Consulting after spending 20+ years as a technology entrepreneur and operator exclusively in the eCommerce industry with companies like ChannelAdvisor, BarnesandNoble.com, Merchantry, and Pitney Bowes.

Watson’s work today is centered on supporting investors and management teams incubating and growing direct-to-consumer businesses. Most recently, in partnership with WHP Global, Rick was a critical resource in architecting the WHP+ platform, a new turnkey direct to consumer digital e-commerce platform that powers AnneKlein.com and JosephAbboud.com.

Watson also hosts a weekly podcast, Watson Weekly, where he shares an unbiased, unfiltered expert take on the retail sector’s biggest players.

In the past year alone, Rick has spoken at many in-person and virtual events as well as podcasts on topics ranging from retail/ecom to supply chain/logistics and even digital grocery including CommerceNext IRL, ASCM Connect, and Retail Innovation Conference.

https://www.rmwcommerce.com/
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