TikTok plans to build a logistics center in the United States to compete with Amazon ?
Recently, according to reports from multiple foreign media, TikTok seems to be preparing to establish its own warehousing and logistics center in the United States.
related reports say that in the past half month, TikTok has posted more than a dozen logistics and warehousing related positions on recruitment websites and LinkedIn, working in Seattle and Los Angeles, and Seattle is also the headquarters of Amazon. Some media and industry insiders analyzed that TikTok is preparing to build a logistics center in the United States.
TikTok's recruitment information further proves these speculations, which shows that "by providing warehousing, delivery and customer returns services, we will help sellers improve their operational capabilities and efficiency, provide buyers with a satisfactory shopping experience, and ensure the rapid and sustainable growth of TikTok Shop." One of the positions requirements are: planning and designing logistics centers and e-commerce solutions, including cargo transportation, order forecasting and inventory management. Another position requires the creation of a new logistics service center “from scratch” that will provide product logistics and delivery services to TikTok Shop sellers by “providing warehousing, delivery and customer returns.”
Judging from this information, TikTok seems to be following Amazon's FBA and establishing its own logistics and distribution system. EMarketer analysts believe that TikTok's move may compete with Amazon: By providing warehousing, delivery and return services to sellers, TikTok can help third-party sellers achieve cross-border sales, which are highly consistent with the Amazon FBA business.
So far, TikTok's e-commerce platform TikTok Shop has not been online in the US market. Previously, the British " Financial Times " reported that TikTok is preparing to cooperate with TalkShopLive to launch its live shopping platform in the United States. It is understood that TalkShopLive has rich experience in live e-commerce and has provided live broadcast technical support for Walmart and Microsoft .
Based on this information, TikTok seems to be preparing to make efforts in the US market and "work a big fight." But so far, TikTok has not given a positive response to outside speculation.
builds a self-built logistics system, which will make up for the shortcomings of TikTok's e-commerce business
It is understood that TikTok Shop will currently provide logistics services in some markets.
TikTok Shop sellers currently have two types of delivery methods, which are divided into "seller delivery" and "TK delivery". Among them, "seller delivery" is the delivery of the goods by the merchants themselves, and "TK delivery" is the delivery of the goods by the logistics method designated by the platform. TikTok will provide relevant supporting services, such as home delivery in some areas, and there will be certain subsidies. Logistics model such as
can help TikTok quickly enter a new market and save investment in logistics. But the disadvantages are also obvious: logistics efficiency and service cannot be guaranteed. This method may be acceptable to consumers in the UK and Southeast Asia. However, in the United States, Amazon and other platforms have been deeply rooted in the past for a long time, and the FBA has achieved next-day delivery in most regions. In order to gain a foothold in the US market, TikTok must build a more efficient logistics model to meet consumers.
Previously, logistics has always been the shortcoming of TikTok Shop. Since there is no logistics layout overseas, TikTok Shop is still mainly used by sellers to ship goods themselves or cooperate with third-party logistics providers. But for cross-border e-commerce platforms, logistics construction is essential to gain a foothold in the market they are deployed. When giants such as Amazon open new sites, logistics is also the first priority.
service capability is also one of the important factors for cross-border e-commerce buyers and sellers to choose a platform. It is precisely because Amazon can provide both parties with comprehensive and high-quality services and solutions that it can dominate the US market. If TikTok wants to take a step further in the e-commerce field, it must improve its service capabilities, and the construction of the logistics system is the first step.
TikTok, is it a new trend or a trap for Chinese sellers?
TikTok has more than 1 billion monthly active users, and market research firm Insider Intelligence expects that about 23.7 million U.S. consumers will make at least once shopping this year through the accompanying links on TikTok or directly on the platform.
. According to the plan of TikTok's e-commerce business department, their GMV this year will reach US$2 billion, and it has completed more than US$1 billion in the first half of the year. The GMV target in 2023 is US$230, which will increase by more than 10 times!
Although TikTok itself has huge traffic and looks bright, there are still certain problems for Chinese sellers to sell goods and monetize through TikTok.
First of all, although some internet celebrities or brands have attracted traffic through TikTok and increased their sales, most of these cases are foreign sellers or brands with a certain degree of popularity. Chinese sellers or white-branded products cannot make foreign consumers feel trust. Most of the time, they can only increase orders through low-priced promotions or even loss-making sales.
Secondly, it is the form of live shopping. For foreign consumers, the acceptance level is not very high. This is obviously different from the Chinese e-commerce market. In the eyes of most foreign consumers, TikTok is just a social entertainment platform, and consumers' shopping habits still need time to cultivate.
TikTok should also be clear about these issues, so TikTok is also increasing its attractiveness by providing support policies to sellers and building logistics centers. It will take time to verify where the ceiling of TikTok's e-commerce business is.
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