TikTok Shop Puts European Plans on Hold, Concentrates on US

TikTok has reportedly decided to put its plans for expanding its eCommerce business in major European markets on hold.

Instead, the ByteDance-owned social media platform will concentrate on growing its presence in the United States, its most lucrative market, where it faces potential divestment or ban, Bloomberg reported Friday (May 31).

TikTok’s eCommerce business, known as TikTok Shop, has been experiencing rapid growth and has become one of the app’s most popular features, according to the report. By combining video content with impulse buying in a visually appealing manner, TikTok Shop has set itself apart from competitors. The success of TikTok Shop is based on ByteDance’s own Douyin, which is one of China’s largest eCommerce platforms.

TikTok had planned to roll out its shopping platform in Spain, Germany, Italy, France and Ireland as early as July. However, the company has decided to pause these expansion plans, along with its intentions to bring the Shop feature to Mexico and Brazil, the report said.

The decision reflects ByteDance’s strategy of focusing on the U.S. market to avert a possible ban, per the report.

ByteDance’s leadership recognizes the importance of concentrating on the U.S. market, which boasts 170 million monthly users, according to the report. By demonstrating its value to domestic merchants and consumers, TikTok aims to mitigate concerns that have discouraged some merchants from signing up for the platform. The company has set a goal to grow its merchandise volume in the U.S. up to $17.5 billion this year.

One of the reasons behind TikTok’s decision to pause its European expansion plans is the potential regulatory scrutiny it may face, similar to what it has encountered in the U.S., the report said. The company understands that a full-scale European expansion could invite regulatory challenges, and it wants to avoid such complications. TikTok is currently under investigation by the European Union (EU) regarding its lighter version of the app in France and Spain, which is being scrutinized for potential addiction risks.

A TikTok spokesperson told Bloomberg that the company is “guided by demand.”

“We’ve seen the positive impact of TikTok Shop, and we’re excited to continue experimenting with this new commerce opportunity,” the spokesperson said in the report.