TikTok Explains Reasons Behind Banning Links To Other E-Commerce Sites
TikTok is reportedly planning to ban links to third-party e-commerce sites like Amazon as it ramps up the shopping platform in the US.
The change is seen as an attempt to force people to use the TikTok Shop if they want to buy a product they see in the application, says The Information. According to the report, TikTok Shop will lose more than $500 million in the US this year.
“TikTok Shop, the app’s nascent shopping service, is expected to lose more than $500 million in the US this year,” it said, citing sources.
The loss reflects TikTok’s heavy investments in hiring, building a delivery network and “supporting merchants that offer double-digit discounts and free shipping,” the report added. In the US, consumers spend about $3-4 million a day on the TikTok Shop. The company expects this number to exceed $10 million by the end of the year.
TikTok, the short video platform owned by ByteDance, launched the online shopping service TikTok Shop in 2021, starting in Indonesia. The shopping platform has become a strong player in Southeast Asia.
Last week, e-commerce giant Sea announced that it will increase investment in its Shopee e-commerce business in all markets as China’s TikTok shopping company expands into new territories.
