TikTok abandons plans to bring shopping to the U.S.

While popular in Asia, TikTok has abandoned its plans to bring shopping into the U.S. after its failed launch in the UK. The company had also planned to expand into mainland Europe, but those plans have also been scrapped.  

What happened in the UK. Several team members in the UK working on the launch were either demoted after taking leave, were sick with stress or were removed from client projects altogether. The Financial Times reports:

TikTok has abandoned plans to expand its live e-commerce initiative in Europe and the US, after the social media platform’s foray into QVC-style shopping in the UK was hit by internal problems and struggled to gain traction with consumers […] 

But the expansion plans have been dropped after the UK project failed to meet targets and influencers dropped out of the scheme, three people said.

Many TikTok Shop livestreams have achieved poor sales despite the company offering subsidies and cash incentives to encourage brands and influencers to sell through the app.

Cultural differences. TikTok and the UK have had their share of culture clashes. Last month it was reported that there were complaints about an “aggressive corporate ethos that runs counter to typical working practices in the UK.”

Joshua Ma, a senior ByteDance executive who ran TikTok Shop in Europe, was replaced, as the company investigated comments made to London-based staff that he “didn’t believe” in maternity leave.

At least 20 members of the London ecommerce team — around half of all its original staff — have left since TikTok Shop’s launch, while others say they are on the brink of quitting. Two employees have been paid settlements over working conditions […]

Ecommerce team members in London said they were expected to frequently work more than 12 hours a day, starting early to accommodate calls with China and ending late as livestreams were more successful in the evening, with “feedback reports” to be filed immediately after.

Convenient timing. This news comes just a week after it was reported that the FCC in the US asked Apple and Google to remove TikTok from their app stores after it was leaked that the app was accessing U.S. user data. Since then, TikTok has allegedly committed to making changes. Could the decision to abandon bringing shopping into the U.S. is at least partially related to privacy and data concerns?

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Why we care. Advertisers and ecommerce business owners who were looking forward to promoting their stores using the new shopping feature will need to restrategize. But given the trouble TikTok has been in lately, it wouldn’t be a surprise if more advertisers started moving away from the platform. We’re not sure what big moves TikTok’s parent company ByteDance will be making in response to these developments, but we’ll be watching.