In a bid to attract shoppers grappling with inflation, popular social media app TikTok is planning to offer significant holiday discounts in a month-long campaign starting in late October. The company aims to kickstart a price war with retail powerhouses Amazon and Walmart through its new online marketplace. TikTok, owned by ByteDance Ltd., is offering subsidies of up to 50% to entice sellers to participate in its Black Friday program set to run from October 27th to November 30th. The move comes as TikTok looks to make a splash during the busy holiday season when US consumers are projected to spend up to $284 billion, according to Deloitte.
TikTok, known primarily for its short, viral videos, boasts over 150 million monthly active users in the US. The company recently launched its Shop marketplace tab in the country, further expanding its commerce business which represents its most promising new source of revenue growth. Bloomberg reported that TikTok aims to generate $20 billion in merchandise sales on the platform globally this year.
While some merchants have found success promoting their products through video campaigns on TikTok, they also note that shoppers are more inclined to complete their purchases on established platforms like Amazon and Walmart. By subsidizing steep discounts, TikTok hopes to familiarize US shoppers with spending money directly through its app and encourage them to spend on its new marketplace.
This year, Black Friday and Cyber Monday are expected to play a crucial role in shoppers' holiday plans, particularly for those seeking deals due to inflationary pressures. According to a survey by United Parcel Service Inc., consumers are likely to be attracted to compelling discounts during the festive season.
TikTok's Black Friday-specific sale will begin on November 23rd at 8 p.m. Eastern Time, while its Cyber Monday sale will run from November 28th to November 30th. The app is already positioning itself as a hub for affordable products, many of which are sourced from China. Ahead of the official launch of the shopping tab, TikTok offered free shipping and 20% off coupons to users. The new marketplace showcases prices prominently in large font and highlights available discounts.
TikTok has verified over 200,000 US merchants on its Shop platform, including more than 150,000 validated beauty products from top brands. The company hopes that its holiday discounts and user-friendly shopping features will drive significant consumer engagement and strengthen its position in the rapidly evolving e-commerce landscape.