Insight Flash: Leverage CE Data to Understand How TikTok Shop’s Growth Could Impact Industries and Brands

TikTok Shop, the online marketplace of the social media platform TikTok, has generated a lot of buzz since its September launch. For some companies it offers another avenue to market and sell their products. For others, it poses a threat as smaller brands and independent sellers can quickly generate a large audience. Leveraging CE’s transaction level data, we examine which sectors and brands could be most impacted by the growth of TikTok Shop.

Industry Cross-Shopping Behavior and TikTok Shop

TikTok Shop, the recently launched online marketplace of the viral social media app TikTok, has been making headlines since its US launch in September. Some have already started heralding TikTok Shop as a long awaited competitor to Amazon Marketplace. Others have seen it as an opportunity to build their brands. Leveraging CE’s U.S. transaction data, we can examine shopper behavior to see which brands might be impacted the most by the newly launched marketplace.  

*Calculated as the number of cross-shoppers divided by total number of shoppers for the 35 day period ending 11/05/23.

Fast Fashion & Intimate Apparel Cross-Shopping Behavior and TikTok Shop

Focusing on subindustries with the highest customer overlap with TikTok Shop during the 35 days ended 11/05/23, we can see that Fast Fashion, Intimate Apparel/Accessories and Online Retailers top the list, as they are likely to be among the most dependent on influencer marketing to engage new customers and have the largest overlap between their target audience and the typical TikTok user. For brands within these subindustries, TikTok Shop could represent an opportunity to grow their customer bases. However, the ease with which independent sellers can reach large audiences could represent a threat to established brands within the space. 

Narrowing down specifically into the Fast Fashion and Intimate Apparel/Accessories subindustries, JustFab tops the list at nearly 7% of its customers also making a purchase at TikTok Shop, though Boohoo and Fashion Nova are not far behind at 5%. The data highlights how these brands, which at the time of writing have yet to appear on TikTok Shop in the U.S., could face a tough challenge as their customers explore other brands within the space.  Perhaps it’s only a matter of time before some of these brands join TikTok Shop, as JustFab and Fashion Nova have already shown a willingness to sell on social media platforms such as Instagram’s Shops.

*Calculated as number of cross-shoppers/total shoppers for the 35 days ended 11/05/23.

It remains to be seen how much traction TikTok Shop can gain in the U.S., but the possibility for brands to be impacted by the growth of another online marketplace is already starting to become apparent. 

Consumer Edge is the leading provider of alternative data for consumer spending behavior, and the only provider of global revenue signals. Our data offers insights into not only the tumultuous world of ecommerce but hundreds of industries, subindustries, tickers, and symbols. If you’d like to benefit from using Transact US or other products for industry data year-round to track trends and dynamics like these, reach out to insights@consumer-edge.com.

References

About the Authors

Michael Gunther is the VP Head of Insights for the CEIC. Explore more of his insights here and follow him on LinkedIn.

Harsh Masher is an Insights Analyst for the CEIC. Explore more insights here.