Once again, if you’re looking for the next moves at TikTok, first look to Douyin, its Chinese sister app.
Today, The Information has reported that TikTok’s looking to open a new series of live-stream studios in Los Angeles, where creators will be able to film content in a more professional environment, kind of like WeWork, but for streamers.
As per The Information:
“[TikTok] is planning to open several locations in cities including LA where creators can livestream and sell products, according to three people familiar with the project. Each location could accommodate multiple studios and dozens of creators a day.”
The initiative is part of TikTok’s ongoing push to make live-stream commerce a thing, after seeing massive success with shopping streams in its Chinese homeland.
Indeed, on Douyin, sales via shopping live-streams are now its biggest revenue driver, and as with this new TikTok initiative, Douyin also hosts a range of live-stream studios, as do various Chinese marketing agencies, where creators can go to film their broadcasts in a more customized environment.
Centralized hubs like this also afford Douyin another key advantage, in being able to pitch these creators on products to sell, with manufacturers coming in to showcase their offerings to these collective groups of Douyin stars.
TikTok has already been moving in this direction, with TikTok itself creating custom products, based on in-app trends, then selling them via its in-app shop in selected markets.
That streamlines product delivery, by working with its own fulfillment centers, while also enabling TikTok to cash in on the latest trends with custom merchandise.
Building dedicated studios will facilitate more opportunities like this, while also enabling TikTok to help these streamers grow their audience, as part of its ongoing shopping push.
Which remains the broader focus.
As noted, TikTok has been pushing commerce streams in Western markets for years, but they haven’t gained significant traction with users as yet.
Yet, even if Western consumers aren’t looking to buy, Eastern users are, with TikTok users in Singapore, Malaysia, and Indonesia increasingly adopting its shopping initiatives.
So even if you don’t see an influx of shopping streams in the app, that doesn’t mean that they’re not happening, but at the same time, TikTok would love to make shopping a more embedded user behavior. And when you also consider the expanding use of the app as a discovery tool, the linkage between entertainment and purchases makes a lot of sense.
TikTok’s expected to test out various new initiatives on this front in 2024, including expanded shopping options like food delivery (which has also been a hit with China), and the development, potentially, of AI-characters as live-stream hosts.
AI hosts, like the ones pictured above, have become much more popular in the Chinese market, with these simulated characters able to stream 24/7, sometimes selling thousands of dollars worth of goods every day.
It feels like the generally lower adoption of commerce streams on TikTok means that we’re not quite at the stage where these will become a thing in Western nations as yet. But then again, maybe AI hosts will reduce the pressure on viewers, while enabling them to still capitalize on live-stream offers, saving brands money as a result.
Essentially, TikTok isn’t giving up on live-stream commerce, and you can expect to see many more in-stream shopping initiatives from the app yet.
Though with some users already complaining that the app is getting too commercial, it could also turn Western audiences away. Which is another risk of TikTok’s ongoing expansion push.