Walmart and TikTok to Import Chinese-Style Livestreaming E-Commerce Stateside
TikTok aims to popularize e-commerce livestreaming in the United States in collaboration with potential buyer Walmart Inc. on Friday, building on a successful business model that has taken root among consumers in China.
U.S. retail giant Walmart said it is hosting a livestreamed shopping event on Friday via its TikTok account, where viewers will be able to directly buy products “without ever having to leave the platform,” William White, chief marketing officer of Walmart, said in a Thursday statement.
The TikTok-Walmart partnership comes after the Beijing-based owner ByteDance agreed in September to sell a stake of TikTok to Walmart Inc. and Oracle Corp. The spinoff came in the face of a U.S. government threat to ban the youth culture sensation, citing national security risks. That deal remains in limbo pending a sign-off from the U.S. foreign investment authority.
The Walmart tie-up marks one of the global video sharing service’s first steps into e-commerce livestreaming outside China, a sector where TikTok’s Chinese counterpart Douyin ranks in second place behind dominant player Alibaba’s livestream site Taobao Live.
In China, livestreaming e-commerce exploded into prominence last year, as gross merchandise volume sold via these scheduled events more than tripled to over 400 billion yuan ($61.2 billion) compared with 2018.
Live online shopping generated around $60 billion in global sales last year, according to data from market researcher Coresight Research Inc., with the vast majority of transactions taking place in China. The U.S. market accounted for less than $1 billion but it has enjoyed quick pick-up this year as people who are cooped up at home double down on online shopping.
Live-selling practices — pioneered on U.S. television in the 1980s by the likes of cable channels QVC and Home Shopping Network— have entered a new era with the rising popularity of livestreaming. Amazon launched its own livestreaming platform Amazon Live last year where hosts discuss and demonstrate products.
Social media giant Facebook has also rolled out an e-commerce feature, dubbed Facebook Shops, where vendors list products from their merchants on virtual store shelves. It allows sellers to tag items presented during livestreaming sessions for customers to click on and order.
Selling live online can enable livestreamers to sell out their entire inventory of a particular product line within hours or minutes. But the approach didn’t catch on in China until the height of the country’s coronavirus outbreak earlier this year when consumers found themselves stuck at home.
The technique has remained popular even after as the virus has been brought under control in China.
Douyin, the Chinese name for TikTok, held a 13% share of Chinese e-commerce livestreaming by transactions last year, according to a report from financial services firm Everbright Securities.
Taobao Live led with an 80% share last year. Douyin also faces fresh challenges from its short-video rival Kuaishou and online retailer JD.com., who have forged a partnership for livestreamers to promote JD’s merchants.
Walmart, one of the world’s largest companies by revenue, tentatively agreed to acquire 7.5% of TikTok Global’s operations, the company said in a statement in September.
Walmart said its upcoming livestream sales would help it reach potential new customers, and is a pilot attempt s as TikTok “began exploring a shoppable product.” For its own part, TikTok currently replies on an advertising- supported business model.
Contact reporter Anniek Bao (email@example.com)
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