The popular short video app Tik Tok enters into an e-commerce deal as the scrutiny of the US government continues over concerns of national security.
Tik Tok enters into an e-commerce deal with Shopify, allowing merchants to create shoppable video ads
The Canadian e-commerce platform Shopify announced that it made a deal with Tik Tok to allow merchants to create their shoppable video ads to encourage customer engagement in online stores. The partnership was announced on Tuesday as negotiations with Walmart to buy a 7.5 percent stake in the video app came to a standstill. Walmart’s deal was a part of the government-forced deal to rescue Tik Tok from the ban by the Trump administration.
Shopify stated that its merchants would be able to select a product for promotion on the app. Subsequently, video ads will be automatically generated that would be visible on Tik Tok user’s video feed, thereby driving customers to online stores for checkout.
Status of Tik Tok’s negotiations with Walmart unclear as it enters the e-commerce space
ByteDance, the Chinese owner of Tik Tok is already running a social media marketplace on Douyin, its twin video app catering to the Chinese market. Currently, purchasing products through the social media marketplace is not as common in the US. Although Pinterest and Facebook-owned Instagram have entered this space and, last year, Tik Tok started making it easier for businesses to link to themselves on the app.
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In a prepared statement, Tik Tok said on Tuesday that Shopify would be a perfect partner to help them grow and expand their commerce capabilities globally. Presently, it is unclear what this deal would mean for Walmart’s negotiations with Tik Tok. Both Walmart and Shopify are on good terms and are working jointly against Amazon in June on a deal to enable Shopify’s business to be listed on Walmart.com.
ByteDance proposes a partnership with Walmart, Oracle, and several American investors to prevent Tik Tok’s US ban
President Donald Trump had said over the summer that he would ban Tik Tok unless Byte Dance sold its US assets to an American company. He stated national security concerns due to Tik Tok’s Chinese ownership and the possibility of spying on the user data by their government.
In September, ByteDance proposed a partnership with Walmart, Oracle, and other American investors to relieve the national security concerns about the app. President Trump expressed his support for the idea but there is no formal approval from the officials yet. The attempt to ban Tik Tok was also delayed until the next week after the US presidential election since the company sued in federal court to stop the order.
