Second, it launched its own payment service in January to supplement the existing payment options, WeChat Pay and Alipay.Īccording to Kejie Yi, a content manager at China Marketing Insights, rolling out Douyin Pay should help Douyin keep users on its pages for longer. To resolve these issues, the ByteDance app made two moves: First, it announced in August 2020 that it would block external links on its livestreaming channel, gradually cutting ties with third-party platforms and steering traffic to its stores. However, traffic came at a literal price: not only would merchants be charged commissions on purchases redirected to Taobao, but Douyin would also incur expenses from processing fees to other payment service providers. Up until last year, sellers were able to directly embed links to online marketplaces like Taobao and JD.com in their videos and livestreams. But will it keep up this momentum? Below, we look at Douyin’s evolution from entertainment app to rising e-commerce star - and what these changes could mean for brands and tech foes alike. Now, it has its eyes on a loftier goal of $150 billion for 2021. In 2020, Douyin’s gross merchandise value (GMV) topped $77 billion, more than three times that of 2019. Thanks to the advancement of algorithm-based recommendation technology, “ Douyin’s e-commerce has seen exponential increase in user growth and transactions,” a company spokesperson told Jing Daily. Over the last year, China’s TikTok has been building out services to capitalize on what it calls the “interest-based economy,” a type of e-commerce that connects consumers and merchants through product discovery. This participation in 618 is the culmination of Douyin’s recent e-commerce efforts. Backed by 600 million active daily users, the ByteDance short-video platform went full force with its 25-day “ 618 Good Things Festival ,” offering steep discounts, tens of thousands of livestreams, $1.5 million is subsidies, and even an interactive game that allowed users to buy certain items for practically nothing.ĭouyin’s 618 activities included the release of “The Interaction City” game (left) and a livestream with Chinese singer He Jie (right). Unfazed by these heavyweights, Douyin also entered the ring for the first time. Meanwhile, rival Tmall doubled its number of participating brands, pushing turnover to a jaw-dropping $107.9 billion. From June 1-18, JD.com tripled its total transaction volume to $53 billion compared to 2020, helping luxury names like TOD’s and Bally surge 232 and 600 percent in sales, respectively. With the annual 618 e-commerce shopping event starting a week earlier than usual, tech giants were out for blood. Last weekend marked the end of China’s second biggest shopping festival - the fiercest consumer battlefield in the first half of the year. Already, beauty giants and homegrown brands have implemented the new feature, with the L’Oréal Group seeing $3.4 million in GMV within a week. Like Tmall and JD, Douyin has rolled out its own flagship stores to help ensure product authenticity and boost sales. But Douyin Pay is unlikely to give WeChat Pay and Alipay - responsible for 90 percent of all mobile payments in China - serious competition anytime soon. Other players include JD.com's JD Pay, Baidu Wallet and Meituan Pay.Ramping up its e-commerce initiatives over the last year, Douyin’s GMV in 2020 topped $77 billion, more than three times that of 2019.īy launching its own payment service, Douyin has started to close its e-commerce loop. It provides a glimpse of what TikTok could eventually become, as Douyin started selling merchandise in 2017 and now operates a growing e-commerce operation where hundreds of millions of users shop on a daily basis.īyteDance's expansion comes as China's financial regulators are tightening oversight over financial technology firms, particularly companies such as Ant Group.Ĭhina's third-party payment sector is dominated by Alipay and WeChat Pay, with the former taking 55.39% of the total market in the second quarter of last year, according to market researcher Analysys. The company, which denies the allegation, has been in talks for months with Walmart Inc and Oracle Corp to shift such assets into a new entity.ĭouyin is the main revenue generator for ByteDance. Hezhong Yibao obtained a third-party payment license from the central bank in 2014.īyteDance has been ordered by the outgoing Trump administration to divest TikTok's U.S. Local Chinese media reported on Tuesday that Douyin Pay had been launched.īyteDance founder and Chief Executive Zhang Yiming built up the company's payment capability in China by acquiring Wuhan Hezhong Yibao Technology Co last year. Users of Douyin, which accumulated 600 million daily active users, previously could use Ant Group's Alipay and Tencent Holdings' WeChat Pay, the country's two ubiquitous third-party mobile payment channels, to buy virtual gifts for livestreamers or items from shops on the platform.
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