Nov 9, 2023 – TikTok users have been found to spend over $250 million in digital gifts to live streamers within the app in the third quarter of 2023 alone, as reported by The Information. This could be an emerging trend where TikTok is encouraging users to spend money within the app. They have been struggling with the idea of getting users to purchase in-stream for quite some time and it’s finally taking off.
Interestingly enough, TikTok users are continuously spending money on in-app purchases rather than tangible products. The following tools have given content creators the opportunity to generate real income, enhance TikTok views, and strengthen relationships with their community.
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They are paying creators to access their exclusive content on TikTok Series.
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Viewers can send Tips to their favorite TikTok creators to show support.
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Video Gifts are virtual gifts that viewers can send through the comments section of a video. Diamonds are awarded by TikTok based on the popularity of a video.
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LIVE Gifts are similar to video gifts except they can be received only when going live. This helps viewers express their appreciation for a creator.
Since these are all novel features, they are getting a lot of hype which is not expected to last for long. But that doesn’t really matter for TikTok because their main objective is getting users comfortable with the idea of spending within the app. They are pretty successful in getting their objective accomplished by introducing these features.
This will help them achieve their long-term goals of introducing commerce elements to promote in-app product purchases. Product recommendations are embedded in the content culture of the app. So it is only rational for TikTok to make it more convenient for users to shop their desired products directly through the app.
Douyin – the Chinese version of TikTok has achieved remarkable success in China where in-stream product purchases have become the primary means of revenue generation for the company. Whereas, Western audiences are giving TikTok quite a tough time in accepting this development on the app.
The fact that they are spending money on creators and not products within the app reveals that it is not their financial information and security they are concerned about. Instead, they are reluctant to accept a social networking site turning into yet another e-commerce platform.
People expending their finances on the TikTok app is, however, a positive sign for the company. This could gradually convince them to buy products through TikTok as well. The concept of in-stream shops is a great one as it will not only make things more accessible for users but also create new job and business opportunities.
Is TikTok going to take the e-commerce industry by storm too after social media? Is it going to be the next highflier in the world of e-commerce? Let’s wait and watch to find out!