TikTok E-commerce U.S. Site Undergoes Huge Changes: Monthly Turnover Exceeds US$200 Million, With Over 30,000 Sellers

“Do you guys have any reliable pallet resources in the US area?” “I’m looking for popular pallets in the US area, personal care and cosmetics!” “Do you have any pallets for elastic bands and elastic ropes for fitness? Give me a drop. ." "Who has local pallets in the home furnishing category?"

In a WeChat group for exchanges between merchants in the US area of ​​TikTokShop, people are asking various questions every day, from finding pallets to arriving at Renjianlian, from operating details to delivery experience, and it is very lively.

Among the TikTok U.S. store merchants that Brand Factory came into contact with, some came from Amazon, some had previous experience in operating British stores, and some came to the U.S. market to look for opportunities after being frustrated in the Southeast Asian market.

The United States is one of TikTok's most important markets. TikTok has disclosed that as of March 2023, monthly active users in the United States have reached 150 million, which is close to half of the U.S. population. The development speed of TikTok's US stores is "far ahead". Data provided by the data analysis platform EchoTik shows that in July 2023, the number of TikTok stores in the US was about 5,000. By October, it had grown to 30,000. In a short time The number of stores has expanded rapidly in just a few months.

Is TikTok’s US market really so charming?

1Amazon sellers lead the way

In March 2023, Liu Yingfeng, a TikTok seller who had been operating in the Southeast Asian market for more than a year, began to work in the US market, putting up links on TikTok and guiding him to independent sites for transactions. It was also from that time that, in order to facilitate information exchange, he began to invite the American TikTokShop sellers he met into the WeChat group.

"From June to now, the threshold for entering the merchant group has become higher and higher. At first, you can join the group as long as you can place an order and receive payment. Later, you need to place 1,000 orders or even receive tens of thousands of dollars in payment before you can join the group. Even so, five or six groups were quickly formed, covering thousands of people." Liu Yingfeng said.

On September 12, TikTok announced the official launch of the e-commerce service TikTokShop in the United States. Since then, TikTok has launched three models of local stores, cross-border stores, and fully managed stores in parallel, and various parties have started a battle for American users.

While developing side by side with TikTok e-commerce, Liu Yingfeng has also witnessed the growth of some sellers, “Some of the sellers I know didn’t even know how to put products on the shelves at the beginning, but now they can reach the top of the category, and they also do If it’s good, it can sell for 200,000 US dollars in one day.”

According to EchoTik statistics, TikTok's e-commerce market in the United States showed a significant growth trend in October, with total sales increasing from US$140 million in September to US$200 million in October, a year-on-year increase of 43%. In July, that number was $27 million.

TikTok’s American local store ACCU model (Chinese-funded American corporate store) can be said to be tailor-made for Amazon sellers with annual sales of more than 2 million US dollars. Products ranked in the top 100,000 on Amazon will be given priority in the TikTok mall. Liu Yingfeng told Brand Factory that among the sellers who are doing well, about 20% of them are from Amazon. "There is a seller in Zhongshan who specializes in live broadcasts. The GMV of a single live broadcast can reach 4,000-6,000 US dollars, and now it can reach 20,000 US dollars a day."

Tony Yang, founder of 3rdRockMedia, an American TikTok service provider, agreed: "The first batch of people to rush forward are basically Amazon cross-border sellers. Now the traffic on TikTok is cheaper and the gameplay is simpler than Amazon, so those who can play well on Amazon Sellers, after coming to TikTok, find that profits may be better. These people have local shipping capabilities and their products have been verified by Amazon consumers, so they have an advantage. But there may be more work to be done in terms of establishing connections among experts. adapt."

However, Li Yingnan, founder of Red Production, believes that some Amazon sellers tend to get stuck in the inertial thinking of one type of e-commerce, and are not very skilled in product selection, product price and sales cycle control. For Amazon sellers, local stocking capabilities do constitute an advantage after TikTok requires local delivery. Currently, TikTok is still in the traffic bonus period, and product selection and traffic management also need to be adjusted.

Of course, there are also some that are not doing well. Some sellers complained to the brand factory that the number of visits to their store exceeded 2,000, and the video they posted had 7,000 views in the natural stream, but still no order was released. “There are plays but no conversions. I don’t know why. Adjustment."

American local brands are also a force that cannot be ignored on TikTokShop. EchoTik data shows that The Beachwaver was TikTokShop's number one store in the United States in terms of sales in October. In July, it ranked 6th among beauty and care stores, with sales exceeding 10 million US dollars. The Beachwaver is an American curling iron brand founded by celebrity hairstylist Sarah Potempa. It has a history of more than 10 years and has many videos on social platforms such as Youtube, TikTok, and Instagram.

Tony Yang introduced: "Many local American brands are small and beautiful, and their SKUs are relatively single. They may only make jewelry such as necklaces. Even the things are not produced by themselves, but are OEM in China, but they can do it on TikTok. The sales are very good because we already have basic users and have rich experience in building connections among experts." This is very prominent in the TikTokShop women's clothing category. In the third quarter, the stores that placed the most orders were local small and medium-sized brands. In many cases, the founders of some brands are designers themselves.

At present, most merchants choose to self-deliver. Liu Yingfeng said that TikTok will currently provide merchants with corresponding shipping subsidies. “As long as you follow the rules of the platform, you can enjoy the subsidy. A friend of mine can get a subsidy of US$30,000 in one month. But some novice sellers, even emerging If a brand does not have strong supply chain capabilities behind it, it will be difficult for it to survive. Without subsidies, it will have to work hard on its operational capabilities, layout capabilities, and comprehensive capabilities in supply chain and other aspects."

In addition to sellers, some TSP institutions that originally operated in other markets have entered the US market. Red Production is one of them. Previously, Red Production mainly operated in the British market. Now it has devoted most of its energy to building its own brand in the United States. MaGO, which started in the Thai market, has also entered the American market and has achieved certain results. . In addition, Best International’s American store has been launched with 0 followers.

2 Master building connections has become a necessary skill for merchants

"Currently, the average customer price of TikTok's U.S. stores is between 25 and 35 US dollars. Of course, there are also higher prices. Most of the orders are brought by experts, and live broadcasts also contribute, but short videos are The current core." Liu Yingfeng introduced.

Tony Yang said that short video delivery accounts for 70% to 80% of their entire sales. "The entire talent environment, business environment, e-commerce environment, and logistics conditions in the United States are relatively mature. American talent experts are very expressive and are basically born to lead dramas, so they are also very good at bringing goods. good."

At present, one way to quickly create a hit in TikTok in the United States is to build hundreds of experts at the same time and use an "overwhelming" method to quickly hit the market on the premise that the product has characteristics and sufficient goods.

A typical case is the Wyze camera. Wyze was founded by Chinese Zhang Yun in 2017 and focuses on high cost performance. EchoTik data shows that the Wyze store has connected more than 2,800 influencers in a short period of time, covering bloggers in various categories such as beauty and personal care, pets, home furnishings, etc., with various fan levels, and has generated a total of more than 9,900 bloggers. The short videos brought a total of more than 12.4 million impressions. The massive exposure has brought huge sales to Wyze. A single product has sold more than 37,000 in the past 30 days, with a GMV of up to US$1.8 million.

Talent Jianlian is also an important way to make single products popular. SooSlick body shaping clothing, which features plus-size women's clothing, has ultra-low limited-time discounts through Jianlian guru, and relies on a large number of before-and-after videos of trying on the shapewear. In the third quarter, sales of nearly 2 million to 2.5 million U.S. dollars were generated by popular products, ranking third, second only to two women's clothing collection stores.

For TikTok merchants, it seems that building connections with celebrities has become a necessary skill. Liu Yingfeng’s letter of building connections with celebrities shared in the community is very popular. "I have friends who are better at it. They not only contact the influencers themselves, but there are even influencers who take the initiative to ask to see the products."

According to Tony Yang’s observation, the agency’s talent matching business is no longer as easy as last year. “Before, talent matching was one of our services. If merchants couldn’t find experts, I would come to them. If there was a problem, I would solve it. But It’s different now. With AI helping to write invitation copy, and with the expert platform screening experts, merchants with a little bit of operational experience can solve these problems by themselves by spending some time.”

After the MCN signs a contract with the talent, the commission from the goods brought by the talent will be divided. However, the reality is that some American talent with strong creative ability are unwilling to do this, because on the talent platform, countless people chase the talent every day. I want him to help recommend products by sending free samples and commissioning.

TikTok is also continuing to strengthen its control over influencers. Sources say that starting from November 15, TikTok will strictly review the personal real-name authentication issues of influencers in Thailand and the United States to ensure one person/one ID/one account. As soon as the news came out, the merchant group was in a panic, worried that the experts who had already established the alliance would shrink back because of the real-name issue.

Li Yingnan said: "Many American influencers have several accounts, but their personal information can only be verified by one account, which will have an impact on the number of influencers who can bring goods. In addition, TikTok does not We will always give the same amount of traffic to the same group of celebrities, and you will basically find that the celebrities are iteratively changing within 3-6 months.”

Tony Yang believes that in the short term, it may have an impact on store groups and virtual accounts, but in the long term, if you want to earn commissions, you must have your real name and identify real experts who are keen on bringing goods, which is a great benefit to the entire ecosystem. A good thing.

3 Virtual warehouse sellers are being eliminated

"I can make 1,000 US dollars a day, and the worst I can do is close the store and lose a month's money. It's enough to earn so much in the past." A seller said in the TikTok merchant WeChat group.

Soon, a group of friends comforted us: "This is just the beginning. If we do a good job of compliance, we will be stable in the long run."

When TikTokShop first opened up cross-border merchants, most people chose to use domestic virtual warehouses in order to test products and reduce costs. The brand factory learned that the so-called virtual warehouse delivery means shipping from China in small packages to the United States, but only the logistics information for the United States will be displayed. Under normal circumstances, the basic shipping fee of a virtual warehouse is about 10-20 US dollars, and if it is shipped from a local warehouse in the United States, the shipping fee is about 6 US dollars. The virtual warehouse mainly saves the storage costs of overseas warehouses and reduces certain stocking risks.

But soon, officials noticed the problem of non-compliance. Since last month, audits have become stricter and stores have been closed. As a result, more and more merchants have realized that to prepare goods for overseas warehouses, they must comply with platform regulations. "If the store is closed, the funds may not be returned within a short period of time, which will have an impact on subsequent operations."

Tony Yang said that TikTok has very high compliance requirements, not only that it cannot use virtual warehouses, but also needs to prepare goods in the United States. Even the pictures uploaded in the store cannot be in Chinese, and packaging, waybills, etc. cannot be in Chinese.

Liu Yingfeng said that some of the merchants he knows have lost hundreds of thousands, and some are still waiting for payment from the platform. “The most important point is that if your store remains listed, you will not be able to operate it in the future. In the past, All layouts are zero, so we must ensure the stability of the store, which is the most important thing.”

Hong Production, which has been operating a TikTok store in the UK for more than two years, attaches great importance to compliance issues. Li Yingnan said: "The United States is a country with relatively strict tax requirements, and the composition and rules of tax are also more complex, including state tax, federal tax, corporate income tax, personal income tax, etc. It seems that these taxes are very complicated, but when If you calm down and handle the tax issue well, you will find that it is part of the cost, so you will not force it. Even if the platform has subsidies and dividends, and you want to make money through subsidies, it will not last long. Yes, we still need to have a long-term operation plan, and at the same time add local American pallets, further optimize product quality, and solve product copyright issues, in order to go further."

In the process of communicating with merchants, Brand Factory generally believes that TikTok in the United States seems to be very lively now, with various stores, but in fact there are not many people who can continue to do it. "Currently, many people are looking for goods locally. They are buying goods that others have prepared in U.S. warehouses. Some of them are actually Amazon's last stock. Out of stock is short-term. Find your own supply chain and stock up in the United States. , is the right way.”

Tony Yang proposed an ideal operating model to brand factories, "China-US matching", in which Chinese merchants solve supply chain problems domestically, prepare products for production and stocking, and even handle basic operations such as customer service. Partners in the United States mainly handle compliance activities such as building alliance experts, live broadcasting, overseas warehouses, tax returns, etc. that need to be done locally to reduce risks even further.

TikTok is non-stop opening up the vast world of live broadcast e-commerce overseas. Those sellers and service providers with persistence and core competitiveness can accompany it to go further.