Tick-tock goes the clock on social shopping - but the hands aren't moving as fast as they might

Stuart Lauchlan Profile picture for user slauchlan July 6, 2022 Audio mode
Summary:
TikTok's social shopping push in the UK is the subject of ongoing scuttlebutt. A wider global consumer study makes for interesting reading alongside.

social platforms

It’s a generally accepted truth in the retail sector that social shopping is the way of the future, with the likes of Facebook and Instagram becoming the commerce platforms that can best engage with social media savvy consumers.

But like all such generally accepted truths, there’s always room for this to be open to question.

According to various reports this month, TikTok has abandoned plans to expand its livestream e-commerce push, first piloted outside of Asia in the UK last year. It had been expected that, following this pilot, the initiative would be rolled out to key markets in mainland Europe in the first half of this year, with the US following in the second half.

But it’s now being reported that the scheme hasn't gained the expected traction in the UK, leading to plans being put on hold. The Financial Times quoted an unnamed TikTok employee as stating:

The market just isn’t there yet. General consumer awareness and adoption are still low and nascent.

The TikTok Shop is built around the concept of shoppers being able to purchase items related to the video that they are currently watching. Its Chinese iteration has been hugely successful, with growth rates of around 300% per annum from sales on Douyin, TikTok’s Chinese sister app.

For its part, TikTok insists that it is proceeding with its UK pilot, telling The Drum:

We are always looking at ways to enhance our community’s experience and regularly test new features that inspire creativity, bring joy and innovate the TikTok experience in markets around the world. Brands on TikTok have found a creative outlet to authentically connect with audiences and we’re excited to experiment with new commerce opportunities that enable our community to discover and engage with what they love.

What’s the social reality?

A recent report from global marketing agency Wunderman Thompson, based on responses from 31,000+ consumers across 18 international markets, makes for interesting reading in light of TikTok’s ambitions.

According to its The Future Shopper Report, nearly two-thirds (65%) of global shoppers said they have already bought through social media platforms, a healthy rise from 44% in 2021. Thailand leads the way with 88% of shoppers having used social platforms for commerce, followed by the UAE and India, both 86%.

The US comes in around the global average on 63%, while the UK is in the bottom three of the countries polled, with less than half of consumers there (47%) having engaged with social shopping.

All that could change as 53% of consumers intend to spend more through social media platforms in the future. Those countries that already above average in terms of their social commerce engagement are also those stating their intention to do more, with Thailand again leading the pack.

Meanwhile UK shoppers come out bottom with a paltry 23%, followed by France and Germany, each on 24%

The other finding that makes for interesting/disturbing reading for TikTok is that only eight percent of shoppers polled said that it was a platform that they would be likely to purchase from in 2022. That’s the same level as last year.

Not that other platforms are showing much growth in enthusiasm either.

Facebook remains the most popular choice on 33%, up two percent year-on-year, followed by Instagram on 24%, up one percent.  Both are cited by shoppers as offering the best social commerce experience, 31% for Facebook, 24% for Instagram. 

But TikTok languishes well behind the front runners on eight percent. Only in China does the platform rank as number one, cited by 34% of respondents - but that’s hardly surprising.

That said, the Wunderman Thompson report does conclude:

The fact that Facebook and Instagram have pioneered on-platform social buying perhaps explains why they are, by some distance, the most popular social sites to shop on worldwide. Although the growing popularity of ‘livestream commerce’, especially among younger age groups, positions TikTok as a major growth platform to watch.

Some 46% of global consumers have used livestream commerce to make an online purchase.  In terms of demographics, 16-24 year olds are the most enthusiastic (58%), with the percentages sliding as the age groups rise.

But again, the UK - where TikTok is piloting its initiative -  is bottom of the heap, with 79% of respondents stating they had not used livestream commerce, compared to 77% of Chinese shoppers or 75% of their Indian counterparts who have.

My take

It’s an evolving space in the retail sector and one that’s got a long way to go before reality catches up with the inevitable hype cycle. I’ve made a social commerce purchase via Facebook. I’ve never made one via TikTok and am unlikely to do so. Both of those facts map neatly onto the Wunderman Thompson report findings.

Does that mean that the social commerce revolution isn’t going to happen? Not at all. It’s just not going to grow at the rates so many commentators expect and it’s not going to have global acceptance at the same pace either. As to what TikTok does next, watch this space. (But the firm has one or two more pressing matters to deal with, I should say…)

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