According to the Wall Street Journal, as more and more United States consumers purchase shampoo, jewellery and clothing commodities through TikTok Shop, retailers are beginning to move into the platform to expand their customer channels. Ralph Lauren and Olaplex Holdings entered the platform at the end of last year, while Ulta Beauty, the largest United States beauty retailer, opened a shop in March, following the footsteps of the pioneers Crocs, Revolve Group and Olya, to join the competition for short video shopping consumers.
Olivia Tong, Managing Director of Raymond James, said: “You need to understand the market, and consumers are now clearly focused on social media and online.” As rising prices have led consumers to move on with their wallets, retailers wish to reach more consumers through the hot application of TikTok with a view to increasing sales. TikTok Shop has been red since landing in the United States at the end of 2023. According to the data provider Consumer Edge, consumer spending on TikTok Shop in the first three months of the year increased by 46 per cent over the same period last year. Retailers see TikTok Shop as an effective way to reach young shoppers, but data show that the fastest growing population at the beginning of the year was in the middle and older age groups, where consumption growth exceeded that of young people in age 45. Data from the electrician data provider, Charm.io, show that a wider appeal helped TikTok Shop to achieve $4.9 billion in sales in the United States in the first quarter, almost twice as much as during the same period last year.
Nevertheless, Marshall Cohen, Chief Retail Adviser to the Market Research Company, stated that within six months as at 22 March, TikTok Shop accounted for only about 1 per cent of the total retail value and about 3 per cent of the electricity company’s sales. He also indicated, however, that TikTok Shop was expanding at an alarming rate, and that its retail market share was expected to double in a year and to account for 10 per cent of the market in 2028. According to Marshall Cohen, “it is clear that consumers have seen TikTok as one of the few platforms to discover new things and establish brand links”. While TikTok Shop is well received, many challenges remain. In January this year, byte beats entered into an acquisition agreement with Oracle, Silver Lake Capital and the consortium of MGX, which obtained 80 per cent of TikTok’s business in the United States, while byte beats retained 19.9 per cent to ensure its future in the United States, yet concerns remain about its privacy and security. Some consumers are cautious about remaining in touch with byte beats and sharing payment data.
Profitability is another challenge. Analysts questioned whether the aggressive consumption culture of TikTok needed a substantial discount to translate the rolling browsing into sales, and that continued promotions could erode retailer profits more than traditional Internet stores. The United States fashion shopping site Revolve launched its TikTok shop shortly after TikTok Shop became online in 2023. Mike Karanikolas, co-founder and joint CEO of Revolve, stated that the platform had since become an important tool for brand discovery and had made an important contribution to corporate income generation. Although TikTok Shop represents only a small fraction of the $1.23 billion sales of Revolve in 2025, Mike Karanikolas believes that this figure is still considerable. He stressed that “it remains, in a sense, significant, after all, not zero”.
Retailers who have not yet entered TikTok Shop are studying how to use the platform for their operations. Academy Sports & Outdoors are among them. The Chief Finance Officer, Carl Ford, indicated that the sporting goods chain was developing a digital shop and was scheduled to be launched later this year. Ford believed that the platform would benefit both brand discovery and income growth. Through the direct display of sports clothes and outdoor equipment on TikTok Shop, Academy aims to capture shopkeepers who may never have visited a real store. “I think it’ll have incremental effects,” Ford says.
