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TikTok Scales Back Live-Stream Commerce Ambitions, Which Could Be a Big Blow for the App

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TikTok’s facing a significant reassessment in its business expansion plans, with the company forced to scale back its live eCommerce initiative in Europe and the US due to operational challenges and lack of consumer interest.

TikTok has been working to integrate live-stream shopping after seeing major success with the option in the Chinese version of the app. But its initial efforts in the UK have been hampered by various problems.

As reported by The Financial Times:

“TikTok had planned to launch the feature in Germany, France, Italy and Spain in the first half of this year, before expanding into the US later in 2022, according to several people briefed on the matter. 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.”

TikTok has since refuted some of FT’s claims, saying that the reported timeline for its commerce push is incorrect, and that it’s focused on fixing problems with its UK operation before expanding, which is still in its roadmap. But the basis – that its program is not going as smoothly as planned – is correct. 

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TikTok’s UK shopping push has also faced internal problems due to conflicts over working culture and management.

Last month, reports surfaced that TikTok’s parent company ByteDance had been imposing tough conditions on its UK commerce staff, including regular 12-hour days, improbable sales targets, and questions over entitlements.

Now, it seems like the combination of challenges has led to a new growth dilemma for the app – which once again underlines the variance between Asian and western app usage trends.

Social media and messaging apps have become a central element of day-to-day life in several Asian countries, with apps like China’s WeChat and QQ now used for everything from purchasing train tickets to paying bills, to buying groceries, banking, and everything in between.

That spells opportunity for western social media providers, with Meta, in particular, looking to use the Chinese model as a template to help it translate the popularity of WhatsApp and Messenger into even more ubiquitous, more valuable functionality, which could then make them critical connective tools in various markets, solidifying Meta’s market presence.

But for various reasons, Chinese messaging trends have never translated to other markets.

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Meta’s Messenger Bots push in 2016 failed to gain traction, and after its Messenger app became ‘too cluttered’ with an ever-expanding range of functionalities, including games, shopping, Stories, and more, Meta eventually scaled back its messaging expansion plans, in favor of keeping the app aligned with its core use case.

Meta then turned to WhatsApp, and making messaging a more critical process in developing markets like India and Indonesia. That expansion is still ongoing, but the signs, at present, don’t suggest that WhatsApp will ever reach the same level of ubiquity that Chinese messaging apps have.

Which then leads to TikTok, the world-beating short-form video app, which has seen massive growth in China, leading to whole new business opportunities, and even market sectors, based on how Chinese users have adapted to in-app commerce.

The Chinese version of TikTok, called ‘Douyin’, generated $119 billion worth of product sales via live broadcasts in 2021, an 7x increase year-over-year, while the number of users engaging with eCommerce live-streams exceeded 384 million, close to half of the platform’s user base.

Overall, the Chinese live-stream commerce sector brought in over $300 billion in 2021. For comparison, the entire US retail eCommerce market reached $767 billion last year.

Given this, you can see why TikTok would view this as a key opportunity in other markets as well – but as noted, Chinese market trends are not always a great proxy for other regions.

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The decision to scale back its eCommerce ambitions is a significant blow to TikTok’s expansion plans, not only from a broader revenue perspective (and worth noting, TikTok’s parent company ByteDance recently cut staff due to ongoing revenue pressures), but also in regards to revenue share, and providing a pathway for creators to make money from their efforts in the app.

Unlike YouTube, TikTok clips are too short to add mid and pre-roll ads, which means that creators can’t simply switch on ads to make money from their content. That means that they need to organize brand partnerships to generate income, and on Douyin, in-stream commerce has become the key pathway to exactly that.

Without in-stream product integrations as an option, that will significantly limit creator earnings capacity in the app, which could eventually see them switch focus to other platforms, where they can more effectively monetize their output.

Which may not seem like a major risk, but that’s exact what killed Vine, when Vine creators called for a bigger share of the app’s revenue, then switched to Instagram and YouTube instead when Vine’s parent company Twitter refused to provide such.

Could TikTok eventually face a similar fate?

TikTok, of course, is much bigger than Vine ever was, and is still growing. But limited monetization opportunities could end up being a big challenge for the app – while it also continues to face scrutiny over its impact on youngsters, and the potential for it to be used as a surveillance tool by the Chinese Government.

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In isolation, it may not seem like a major move, scaling back its eCommerce ambitions just slightly as it reassesses the best approach. But it’s a significant shift, which will slow down TikTok’s broader expansion. And it could end up hurting the app more than you, initially, would think.

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Snapchat Explores New Messaging Retention Feature: A Game-Changer or Risky Move?

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Snapchat Explores New Messaging Retention Feature: A Game-Changer or Risky Move?

In a recent announcement, Snapchat revealed a groundbreaking update that challenges its traditional design ethos. The platform is experimenting with an option that allows users to defy the 24-hour auto-delete rule, a feature synonymous with Snapchat’s ephemeral messaging model.

The proposed change aims to introduce a “Never delete” option in messaging retention settings, aligning Snapchat more closely with conventional messaging apps. While this move may blur Snapchat’s distinctive selling point, Snap appears convinced of its necessity.

According to Snap, the decision stems from user feedback and a commitment to innovation based on user needs. The company aims to provide greater flexibility and control over conversations, catering to the preferences of its community.

Currently undergoing trials in select markets, the new feature empowers users to adjust retention settings on a conversation-by-conversation basis. Flexibility remains paramount, with participants able to modify settings within chats and receive in-chat notifications to ensure transparency.

Snapchat underscores that the default auto-delete feature will persist, reinforcing its design philosophy centered on ephemerality. However, with the app gaining traction as a primary messaging platform, the option offers users a means to preserve longer chat histories.

The update marks a pivotal moment for Snapchat, renowned for its disappearing message premise, especially popular among younger demographics. Retaining this focus has been pivotal to Snapchat’s identity, but the shift suggests a broader strategy aimed at diversifying its user base.

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This strategy may appeal particularly to older demographics, potentially extending Snapchat’s relevance as users age. By emulating features of conventional messaging platforms, Snapchat seeks to enhance its appeal and broaden its reach.

Yet, the introduction of message retention poses questions about Snapchat’s uniqueness. While addressing user demands, the risk of diluting Snapchat’s distinctiveness looms large.

As Snapchat ventures into uncharted territory, the outcome of this experiment remains uncertain. Will message retention propel Snapchat to new heights, or will it compromise the platform’s uniqueness?

Only time will tell.

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Catering to specific audience boosts your business, says accountant turned coach

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Catering to specific audience boosts your business, says accountant turned coach

While it is tempting to try to appeal to a broad audience, the founder of alcohol-free coaching service Just the Tonic, Sandra Parker, believes the best thing you can do for your business is focus on your niche. Here’s how she did just that.

When running a business, reaching out to as many clients as possible can be tempting. But it also risks making your marketing “too generic,” warns Sandra Parker, the founder of Just The Tonic Coaching.

“From the very start of my business, I knew exactly who I could help and who I couldn’t,” Parker told My Biggest Lessons.

Parker struggled with alcohol dependence as a young professional. Today, her business targets high-achieving individuals who face challenges similar to those she had early in her career.

“I understand their frustrations, I understand their fears, and I understand their coping mechanisms and the stories they’re telling themselves,” Parker said. “Because of that, I’m able to market very effectively, to speak in a language that they understand, and am able to reach them.” 

“I believe that it’s really important that you know exactly who your customer or your client is, and you target them, and you resist the temptation to make your marketing too generic to try and reach everyone,” she explained.

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“If you speak specifically to your target clients, you will reach them, and I believe that’s the way that you’re going to be more successful.

Watch the video for more of Sandra Parker’s biggest lessons.

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Instagram Tests Live-Stream Games to Enhance Engagement

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Instagram Tests Live-Stream Games to Enhance Engagement

Instagram’s testing out some new options to help spice up your live-streams in the app, with some live broadcasters now able to select a game that they can play with viewers in-stream.

As you can see in these example screens, posted by Ahmed Ghanem, some creators now have the option to play either “This or That”, a question and answer prompt that you can share with your viewers, or “Trivia”, to generate more engagement within your IG live-streams.

That could be a simple way to spark more conversation and interaction, which could then lead into further engagement opportunities from your live audience.

Meta’s been exploring more ways to make live-streaming a bigger consideration for IG creators, with a view to live-streams potentially catching on with more users.

That includes the gradual expansion of its “Stars” live-stream donation program, giving more creators in more regions a means to accept donations from live-stream viewers, while back in December, Instagram also added some new options to make it easier to go live using third-party tools via desktop PCs.

Live streaming has been a major shift in China, where shopping live-streams, in particular, have led to massive opportunities for streaming platforms. They haven’t caught on in the same way in Western regions, but as TikTok and YouTube look to push live-stream adoption, there is still a chance that they will become a much bigger element in future.

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Which is why IG is also trying to stay in touch, and add more ways for its creators to engage via streams. Live-stream games is another element within this, which could make this a better community-building, and potentially sales-driving option.

We’ve asked Instagram for more information on this test, and we’ll update this post if/when we hear back.

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