TikTok’s new Amazon copycat is full of cheap goods

TikTok’s Shop marketplace, the video app’s biggest bet for new revenue growth, has launched for select users in the US. Initially, the marketplace primarily features cheap products from China. The Shop option is prominently displayed between the For You and Following feeds, offering a continuous scroll of randomly recommended products. Notable items include a potentially counterfeit Nike sweatshirt priced at $2.99 and a “naughty dwarf” statue sitting on a toilet for $6.99. Several listings indicate that the items are shipped from China, which could raise regulatory concerns about user data security if Chinese sellers have access to it.

According to reports, TikTok Shop aims to achieve $20 billion in merchandise sales this year, putting it in direct competition with Amazon. Internally, the initiative has been referred to as a “community commerce” effort, leveraging the app’s ability to bring people together through shared interests. However, the early version of the marketplace lacks the personalized algorithm that TikTok is known for, which has been crucial to its success in engaging user attention.

Similar to Amazon, TikTok Shop faces challenges in categorizing its products. The Home & Kitchen section, for example, displays a range of items, from a mini-car trash can priced at $0.37 to a four-foot computer desk at $16 and a three-piece polyester satin sheet set at $8.43. Many listings contain misspelled brand names and suspiciously low prices, potentially indicating counterfeit sales.

TikTok has dismissed the claims made in the article, stating that it does not accurately represent the TikTok experience. However, the marketplace emphasizes low prices, highlighting discounts and free shipping offers in red and green. The urgency to purchase is created through a countdown clock and displaying the number of times a product has been sold.

The Shop section does not list brands upfront, and product names seem designed for search algorithms rather than human shoppers. For example, one listing advertises a product called “Women’s 3 Piece High Waist Workout Shorts Butt Lifting Tummy Control Ruched Butt Smile Yoga Short Pants.”

One of the most prominent sections in TikTok Shop is “Today’s Deals.” The top promoted product on Bloomberg’s feed was a snail mucin-based face serum, priced at $7.99. However, neither this price nor the original list price of $39 aligns with the $25 price advertised on the official COSRX website. The TikTok seller also claims that the product is manufactured in China, despite COSRX products stating on their packaging that they are made in Korea.

TikTok asserts that there are over 200,000 verified US merchants selling legitimate products on TikTok Shop, including over 150,000 beauty products from major beauty brands. However, a quick search reveals Chinese brands on TikTok Shop that have been banned from Amazon for fake customer reviews, such as Taotronics, VAVA, and Mpow.

TikTok’s user terms and conditions state that it does not guarantee the accuracy or completeness of the content on TikTok Shop and disclaims liability for any such content. When making a purchase, TikTok processes payments through its app, collecting additional user information such as card details, billing address, and shipping address.

This may attract regulatory scrutiny, as TikTok has faced pressure from US governments regarding data privacy practices. Concerns have been raised about the Chinese ownership of the app and the potential for users to be tracked or influenced. TikTok has stated that it is working to isolate sensitive data from its American users and store it in the US. The company claims that user data collected by sellers through TikTok Shop is not its responsibility.