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According to the latest data from dataai, in 2023, social applications on the Android platform will grow significantly, with usage time exceeding 2.3 trillion hours and user spending approaching $9 billion , a year-on-year increase of 13%. Among them, TikTok was named the "Best App Monetization King" for its outstanding performance in effective monetization strategies.
Today, TikTok is accelerating its global expansion. After launching TikTok Shop, the overseas live streaming e-commerce led by it has exploded with huge growth potential. Under this trend, many domestic live streaming e-commerce bigwigs have smelled the business opportunities of overseas live streaming e-commerce, and followed TikTok's footsteps to start a new journey overseas. In the past few years, China's live streaming e-commerce industry has developed rapidly. The strong market vitality it has demonstrated has not only attracted many small and medium-sized sellers, celebrities, etc. to join the live streaming craze, but also spawned a large number of top live streaming anchors, such as "TikTok No. 1" Xiao Yangge, Dongfang Zhenxuan Dong Yuhui, etc. However, as time goes by to 2023, the competition in live e-commerce is becoming more and more fierce, and the traffic is gradually peaking . Compared with the wild growth in the past, live e-commerce has entered a period of stable development. Data shows that in the first half of 2023, the penetration rate of live e-commerce transactions is about 27.8%, and it is expected to reach 31.9% for the whole year, with a growth rate of 26.08%. Compared with the penetration rate of 40.79% in 2022, the growth rate has slowed down again. At the same time, according to FastMoss data, TikTok's US closed-loop e-commerce data is expected to reach 100 million US dollars per day by the end of 2024. In comparison, the overseas live e-commerce industry led by TikTok is undoubtedly an excellent stage for domestic live broadcast bigwigs to expand new growth.
In January this year, a video on the Douyin account "TikTok Business Unit (Three Sheep)" showed that Xiao Yangge's company Three Sheep Network has deployed overseas live streaming sales in Singapore. After cooperating with overseas influencers to launch the first live streaming sales, the Three Sheep account rushed to the top of the TikTok Singapore sales GMV rankings , and put the "Malaysia premiere" of the second overseas stop on the agenda. At present, the Three Sheep IP has completed the construction of a 2 million fan content matrix in Southeast Asia. In the same month, Dongfang Zhenxuan also posted a number of job openings for TikTok-related positions on its official and recruitment platforms, with the monthly salary for TikTok store operators reaching 40,000 yuan. At the end of January, according to China Securities Journal, in response to market rumors that Dongfang Zhenxuan might cooperate with TikTok in terms of overseas supply chain, people familiar with the matter said the news was true . Prior to this, leading live streaming organizations such as Yaowang Technology, Qianxun Culture (Viya and her husband), and Jiaogepengyou (Luo Yonghao) had already started their overseas live streaming sales layout on TikTok, although their methods were different:
Yaowang Technology is developing short video and live broadcast businesses around TikTok in the hope of "rebuilding Yaowang" overseas; Qianxun Culture has recruited many American influencers with millions of fans, and has recruited investment from domestic brands in multiple categories. Jiaogepengyou hopes to achieve a "closed loop" from training, marketing to sales overseas by developing three major businesses.
According to the data from Crawley Index Research Institute, by 2023, nearly 30% of domestic MCN agencies have already started to go overseas, and another 14.9% are in preparation or waiting. TikTok, with its huge native traffic pool, has become the preferred platform for domestic top live broadcast celebrities to go overseas. However, it is worth noting that due to the differences in domestic and foreign social e-commerce environments, the domestic live streaming e-commerce sales method is bound to be "unsuitable" overseas. The huge development trend of social e-commerce is attracting more gold diggers to enter the market. According to ecommerceBD data, the global social e-commerce market size reached US$724 billion in 2022 and is expected to soar to more than US$6 trillion by 2030. Based on the rapidly growing growth potential of social e-commerce, not only overseas social platforms are focusing on the development of e-commerce models, but traditional e-commerce giants such as Amazon are also testing the waters in the field of social e-commerce:
In 2022, Walmart announced the launch of a new platform "Walmart Creator" to increase its investment in social e-commerce; In 2023, after launching the live e-commerce function, Meta announced a partnership with Amazon to launch new in-app shopping features on Facebook and Instagram.
However, compared with the mature domestic social e-commerce market, the development level of the overseas social e-commerce market is relatively low and is still in its infancy: on the one hand, overseas consumers have a low acceptance of social e-commerce and have not yet developed the habit of shopping on social platforms; on the other hand, traditional leading e-commerce platforms such as Amazon have long established powerful logistics networks and warehousing systems overseas, which can achieve rapid delivery, while the development and construction of overseas social e-commerce platforms in this area is obviously insufficient.
Constrained by the above factors, TikTok, which has always been favored by industry insiders, has also encountered bottlenecks in its overseas e-commerce model. In the early days of going overseas, TikTok focused on accumulating traffic , and its revenue mainly came from advertising monetization. In 2018, TikTok acquired Musical.ly, a social app that was once popular in the United States, and entered the US market. According to TikTok's publicly disclosed data, as of August 2020, TikTok's total number of monthly active users in the United States has exceeded 100 million. In 2021, TikTok took the lead in launching an e-commerce model - TikTok Store in the Indonesian and British markets. However, due to fulfillment and product quality issues, TikTok Store's business in the UK failed to meet expectations , and ultimately chose to slow down the expansion of its e-commerce business in Europe and the United States. It was not until 2022 that TikTok attempted to transform itself into an e-commerce platform in the U.S. market in a "semi-closed-loop model" : it reached a strategic partnership with Shopify, an independent website building platform, to provide a traffic channel for Shopify sellers. However, under this model, TikTok only served as a "traffic transfer medium" and failed to build its own e-commerce ecosystem. Looking at the development of TikTok's e-commerce model, the core proposition of social media e-commerce is nothing more than traffic conversion. Backed by a huge traffic pool, whether it is overseas social media platforms such as Facebook, Instagram, or TikTok, young and highly sticky user groups are their natural advantages. How to transform this advantage into a boost to the e-commerce model, intercept traffic within the platform, transform social needs into shopping needs, and establish their own e-commerce ecosystem is the key to the development of the social e-commerce model. In 2023, TikTok launched TikTok Shop in the United States, fully focusing on the full closed-loop model , and canceled the semi-closed-loop model in September. It is reported that during the testing phase, 200,000 merchants in the United States have entered TikTok e-commerce, and more than 100,000 TikTok influencers have participated in TikTok e-commerce services. In addition, in early January this year, people familiar with the matter revealed that TikTok Shop has set a GMV (gross merchandise volume) target of US$50 billion for 2024, more than 1.5 times the target figure of US$20 billion for 2023, and TikTok plans to expand the scale of its US e-commerce business tenfold to US$17.5 billion in 2024. TikTok, which once had a hard time adapting to the local environment, is gradually building its own e-commerce ecosystem through continuous strategic adjustments, so that the platform traffic is no longer used by external platforms, and an internal shopping closed loop is achieved. In the future, with the continuous development of social media and further innovation in the e-commerce industry, the prospects for global social e-commerce cannot be underestimated. However, at this stage, the overseas social e-commerce environment has not yet developed fully, and there are significant cultural differences at home and abroad. Live streaming KOLs who have left the "hotbed" still have many challenges to solve if they want to replicate the domestic GMV myth overseas. Influenced by historical, geographical, social and religious factors, there are some differences between Chinese and foreign cultures in many aspects, such as values, sense of collectivism, and privacy rights. These differences are reflected in consumers' shopping preferences and the internet celebrity economy in the social e-commerce industry. Therefore, for domestic anchors and organizations, "localization" is undoubtedly the core challenge of going overseas. Take the influencer economy as an example. Compared with domestic influencers, most European and American influencers are not good at shooting e-commerce videos. Their content production focuses more on personal style information rather than products, so the publicity effect may not be as good as that of domestic KOLs. In addition, due to the lack of relevant laws, foreign influencers have weaker contract performance capabilities. If the influencers are unable to perform their contracts, the cost of a lawsuit filed by a live broadcasting organization may even be higher than ignoring the cooperation. With the popularization of the Internet and the rise of digital lifestyles around the world, it is understandable that domestic top anchors and institutions are turning their attention to foreigners' wallets. However, if they blindly copy the domestic live broadcast experience, this will obviously not work overseas.
In the face of cultural differences between different countries and regions, domestic anchors and organizations need to conduct localized operations , which includes not only adapting to local user needs and creating content that conforms to local culture, but also cooperating with local KOLs and understanding the law. Team Building On the one hand, if domestic institutions want to do a good job in influencer marketing, they can set up corresponding overseas social media marketing teams to gain a deeper understanding of the local cultural environment and market demand. In terms of content creation , domestic anchors and organizations can develop diversified content formats. In addition to traditional live broadcasts, the short video craze launched by TikTok can better meet the needs of different consumers. In terms of brand marketing , domestic anchors and agencies can tell good "overseas stories" for Chinese brands and enhance brand influence and expand market share by establishing cooperative relationships with overseas fan communities, media, content creators, etc.
With the rapid development of TikTok's e-commerce, the potential of the overseas live streaming e-commerce market will be further released. Among the domestic anchors and institutions that have successively gone overseas, whoever can do a good job of "localization" will have a better chance of replicating the myth of domestic GMV growth.
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