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TikTok Shop explained: How brands and creators use the social shopping tool to drive sales

Posted by Caroline Edwards in Case studies

10 months ago

“I can confidently say we have rapidly scaled revenue as a direct result of being consistent with TikTok Shop,” Coco Cosmetics by Chloe founder Chloe Walsh told CORQ. The brand (which has more than 396,000 TikTok followers) began using TikTok Shop in early 2022 and has “seen huge growth ever since”.

Walsh’s brand is just one of the many companies reaping the rewards of TikTok’s shopping feature. In one week in July 2023, beauty influencer Mitchell Halliday’s brand Made by Mitchell generated $2 million (£1.5 million) in sales.

TikTok Shop poses a key opportunity for brands. It’s no secret that when a product goes viral on TikTok, it can lead to a huge uptick in sales. After all, #TikTokMadeMeBuyIt has 68.9 billion views on the app.

Key takeaways

  • CORQ spoke to brands including Coco Cosmetics by Chloe and TOMM Jewellery about their experiences with TikTok Shop, including its benefits and pitfalls, as well as best practices to find success.
  • TOMM Jewellery noted approximately 20-25% of its revenue comes from TikTok Shop.
  • For creators, TikTok Shop works as an affiliate programme. Brands usually offer a commission of 5-10%.
  • CORQ spoke to influencers Elise Loubatieres (Littlemissplumful), Scott Mousley-Young (MakeupbyScott) and Mandy Huynh (Mandylikes) about how they drive sales on the social shopping tool.
  • Loubatieres generated more than £10,000 in sales for the fashion brand Mooslover in one month.

What is TikTok Shop?

TikTok Shop has been described as a “modern-day QVC”. Brands and creators alike can advertise goods by hosting TikTok Lives, linking products within their in-feed videos and adding them to their Product Showcase tab on their profiles.

Products on TikTok Shop range from beauty to clothing, accessories, books, food and home decor, with many items (including headbands, glassware and makeup bags) being sold for less than £1.

TikTok Shop launched in the UK in late 2021 – the tool’s first market outside of Asia – but is not yet available globally. In August 2023, Fulfilled by TikTok was introduced in the UK, which is a logistics programme that “picks, packs and then ships merchants’ products to the TikTok community”.

While the shopping feature has generated plenty of buzz, it hasn’t all been smooth sailing. According to a 2022 Financial Times article, TikTok abandoned plans to expand the Shop across Europe and the US due to the UK launch failing to meet targets. However, Campaign reported that TikTok disputed these claims.

Still, TikTok Shop continues to expand, with brands such as VIEVE, Benefit Cosmetics, PrettyLittleThing and TALA all part of the programme. TikTok earns a commission from each product sold via TikTok Shop. The commission is reduced to 1.8% during the initial 90 days when merchants upload a product to their shop within 60 days. After 90 days, the commission reverts to 5%.

How brands use TikTok Shop

Glisten Cosmetics founder Natalie Chapple previously told CORQ that discounts, exclusivity and limited stock are key to succeeding on TikTok Shop. Create a sense of urgency – for example, Walsh’s Coco Cosmetics by Chloe brand holds flash sales with discounts.

The platform has been fruitful for Walsh and has enabled her small business to grow and scale up. Her brand is known for its viral Marshmallow Sponge, and it has sold more than 69,000 units of its Marshmallow Makeup Sponge Shape 2 through TikTok Shop.

“It’s such a visual and authentic platform and there is no high production required to create content. It makes it the perfect place to show your products to a wide audience.”

Her brand utilises both TikTok Lives (both scheduled and spontaneous) and in-feed videos with shoppable links. Lives mean the company can interact with customers in real time. “It’s an amazing platform for any brand to build trust and credibility, which ultimately drives sales and brand loyalty.” It is worth noting that brands need to be aware of potential violation breaches to avoid on Lives.

TikTok Shop is beneficial, but it still has its pitfalls. TOMM Jewellery founder and director Lucy Toone told CORQ she hasn’t found it a “totally easy ride”. At the moment, TOMM Jewellery isn’t putting much effort into using the shopping feature.

Toone’s company was one of the first brands on TikTok Shop and began using the feature in January 2022. It contributes to approximately 20-25% of the company’s revenue.

“The general consumer takes seven times to look at a product or brand to gain trust in them to purchase, but the transaction rates are pretty quick with TikTok.”

While TikTok Shop leads to fast-paced sales, it also means there are poor-quality products available. Toone has raised this with TikTok and said: “[TikTok] should have cherry-picked [the brands] a bit more.”

From the consumer perspective, she thinks TikTok Shop is great as it is easy to make returns. However, this can pose a problem for brands if customers “hack” the system.

“[Returns] can be quite an issue because people know they can say it never arrived, even when the tracking clearly shows it did and TikTok will override my decision not to refund it [even though] I can see it in their hands in the tracking picture,” Toone said.

“We lose money monthly because TikTok has all the power to refund our customers.” She stated products such as earrings should not be refundable due to hygiene, but TikTok Shop does not have this policy.

When it comes to working with creators, brands can offer different affiliate options. This includes: the Shop Plan, which offers a flat commission rate for all of its products; an Open Plan, which offers specific commission for particular products; or a Targeted Plan, which consists of selecting certain creators to promote specific products.

Creators and TikTok Shop

For creators, TikTok Shop is available to TikTokers who have more than 1,000 followers, have posted a video in the past 28 days, are aged 18 or older, and have an account “in good standing”.

TikTokers can request samples from brands to promote the products. TOMM Jewellery offers 10% commission for creators and approves about 5-10% of sample requests. Coco Cosmetics by Chloe’s commission rate ranges from 5-10%, depending on the product.

Creators promote an array of products on TikTok Shop. Actor Anoushka Chadha has sold ramen noodles as well as whey protein and beauty products, lifestyle creator Eniyah Rana’s Product Showcase includes abayas and makeup products, and Channon Mooney promotes fashion and beauty goods.

Lifestyle creator Elise Loubatieres (Littlemissplumful) told CORQ she generated more than £10,000 in sales for fashion brand Mooslover in one month by posting videos wearing its activewear jumpsuit styles – which she then earned commission on. One of her videos from June 2023 has more than 319,000 views and 8,000 likes.

Loubatieres started using TikTok Shop earlier this year and is part of both the TikTok Creator Fund (which pays creators based on views) and the TikTok Shop affiliate programme, which provides agents that advise on and coordinate campaigns with brands. She also receives bonuses when hitting and surpassing sales targets.

“As a creator, TikTok Shop has become a great way of sharing products that I love and gaining [a] passive income from these. It’s also made the process a lot easier for my followers to purchase my recommended products without having to leave the TikTok app.” She noted that brands are increasingly asking her to use TikTok Shop links in her sponsored content.

Beauty creator Scott Mousley-Young (MakeupbyScott) started using TikTok Shop in August 2022 and his videos about “big brands” on TikTok – including P. Louise and Made by Mitchell – perform the best. “If I post a video [about] Made by Mitchell, I’m guaranteed to get quite a few sales.”

Interestingly, one of the products Mousley-Young has seen the most success with is a keyring light that costs approximately £3.50, having sold approximately 600 of these in one day. Mousley-Young said that posting about trending products will generate the most sales, and he has friends who sold thousands of bottles of the viral Nature’s Spell rosemary hair oil.

Mousley-Young sells products through in-feed videos, three- to four-hour TikTok Lives, and Lives for brands. He doesn’t do much TikTok Shop content during the final week of the month (as people tend to be spending less) but when payday arrives, he hosts TikTok Lives three times a day and posts as many videos as possible. Posting at the beginning of the month is key, as some brands offer a higher commission.

Each creator CORQ spoke to had success with different brands. Beauty creator Mandy Huynh (Mandylikes) tends to promote the same products consistently and has the best success when selling influencer Holly Boon’s brand HNB Cosmetics’ foundation and concealer, as well as BPerfect Cosmetics’ highlighter collaboration with Love Island winner Ekin-Su Cülcüloğlu. For Huynh, these products align with her usual content, which is focused on glowy makeup and skincare.

Huynh began using TikTok Shop in November 2022 and started using it more regularly in April and May 2023. She noted: “You don’t want to be too sales-y when it comes to constantly pushing products to your followers.”

What do creators want to see next? Huynh has enjoyed using the feature and believes it’s a brilliant idea, but would like larger retailers to join TikTok Shop. Loubatieres wants more commission perks, as well as access to campaigns with brands via TikTok Shop, rather than simply working on a commission basis. For Mousley-Young, one pitfall is the lack of consistency. “You can have a great day, but then make no sales the next day.”

However, Mousley-Young (nearly 20,000 followers) noted TikTok Shop has offered him a lot of freedom. “[I’ve] been able to make a living without having the massive followings that everyone else does.”

As with anything, TikTok Shop isn’t perfect. It’s a new tool that is paving the way for social-first shopping.

In the words of Walsh: “There are many setbacks still about TikTok Shop and my main advice to any business owner is what works for one brand, doesn’t mean it has to work for you.

“Carefully consider if using TikTok Shop is right for your business and how it works. Bear in mind there are restrictions on what you can sell, payment options are restricted and it’s not available in all countries.”

By Caroline Edwards, CORQ news and features writer.