TikTok could have been the world’s high app by downloads and shopper spending in 2023, however it was not the highest by precise utilization. Final yr, Fb once more maintained its No. 1 place by month-to-month lively customers, adopted by different Meta-owned apps WhatsApp, Instagram, and Messenger — all of which have been forward of TikTok at No. 5. Now new information signifies that TikTok’s progress has began to gradual, begging the query of whether or not the app’s transfer into e-commerce through TikTok Store is in charge.
In keeping with new information from market intelligence agency Sensor Tower, whereas TikTok’s progress stays constructive, that progress is decelerating. In 2022, TikTok’s month-to-month lively customers grew a median of 12% year-over-year per quarter, however this determine fell to three% year-over-year per quarter in 2023.
The change comes on the heels of TikTok’s launch of TikTok Store within the U.S.
The video app started testing Store within the U.S. in November 2022 and people exams expanded initially of final yr as extra manufacturers got here on board, together with PacSun, Revolve, Willow Boutique, and wonder model KimChi Stylish, amongst others. Whereas the Store didn’t “formally” launch within the U.S. till September 2023, it was solely certainly one of a number of efforts to translate the affect of TikTok movies — basically the entire “TikTok made me purchase it” meme — into real-world gross sales.
Final summer season within the U.Ok., for instance, TikTok experimented with an in-app procuring part known as “Stylish Beat,” which provided merchandise bought by TikTok mother or father ByteDance. TikTok additionally gives an associates program that permits creators to earn commissions from merchandise, as the AP and others have reported.
However sellers’ embrace of the procuring platform has began to result in complaints, as Enterprise Insider famous in November, with some lamenting that TikTok Store was turning the app into an “ad-filled wasteland” and a “dystopian” area. Elsewhere on the net, Redditors have been debating whether or not TikTok Store has “ruined” the app, which is now full of “folks dropshipping/promoting low cost merchandise,” as one Reddit person put it.
“Personally, I’m beginning to get actually aggravated by how virtually each different video on my [For You Page] is somebody overhyping a product from the Store function to attempt to get it to go viral and make quite a lot of commissions,” wrote Redditor u/megg-salad-sammich in September. “It’s nice that it’s a brand new avenue for creators to become profitable, however I discover myself scrolling much less and fewer as a result of I do know just about each video is simply making an attempt to get me to purchase some random factor,” they stated.
A search throughout Reddit finds many extra threads complaining of the identical factor all through final yr — saying how TikTok is “annoying” now due to TikTok Store and seeing adverts each few movies is a irritating expertise.
Whereas TikTok customers are adapting to their favourite social community turning into a web-based mall, TikTok’s Store Vendor app, which powers its e-commerce initiative, has grown.
Sensor Tower information signifies the Store Vendor’s progress has been “sturdy” because the fourth quarter of 2022, rising 230% year-over-year as of the fourth quarter of 2023. Nonetheless, the app has solely a fraction of TikTok’s lively person base — at the moment 1.4 billion as of the primary quarter of this yr. Store Vendor, in the meantime, has simply round 6 million month-to-month lively customers, the agency reported.
Instagram may in the end profit from the person frustration round TikTok Store, on condition that the Meta-owned app eliminated its personal Store tab in January of final yr and killed off dwell procuring in March. This might probably make it extra acceptable to these desirous to keep away from extra direct calls to motion to buy in-app.
Meta’s transfer was triggered by broader business traits, which appear to not bode properly for TikTok Store’s future. Reside procuring had blossomed through the pandemic, and e-commerce gross sales skyrocketed. However when issues returned to regular, social commerce (together with dwell procuring) was discovered to have made up solely round 5% of whole e-commerce gross sales within the U.S. as of 2022. That appeared to point that U.S. shoppers could not have been as primed to buy immediately from movies, although they are clearly nonetheless influenced by on-line traits.
Nonetheless, customers aren’t but so upset with TikTok Store as to desert the app for Instagram Reels.
Sensor Tower discovered that Instagram’s month-to-month lively person progress has been comparatively constant at “mid-single digits” and hasn’t been considerably impacted negatively or positively because the launch of the TikTok Store Vendor app.
Knowledge from one other agency, Appfigures, additionally helps this conclusion however provides that, though TikTok’s income has been rising, its downloads have been stagnant or dropping greater than rising — a development that’s been happening for over a yr now, together with each globally and within the U.S.
Picture Credit: Appfigures
Picture Credit: Appfigures
