Mixed headlines continue for retailers as economic uncertainty deepens. But the Gen Z-TikTok effect, bold new partnerships, and an exploding retail media market offer opportunities for brands in 2023. Those that remain nimble will come out on top.

TikTok Makes Them Buy It: Gen Z’s Social Commerce Habits Are Shaped by Chinese Players

Gen Z’s favorite platform has started testing TikTok Shop with select US merchants. The company’s latest corporate reshuffle and hiring plans point to a focus on commerce, which will offset a lowered ad revenue outlook. US ecommerce livestreaming and owned fulfillment centers are on the horizon—building on the #TikTokMadeMeBuyIt phenomenon (30 billion views and counting) to entice young shoppers.

TikTok is poised to crack the elusive US social commerce nut:

• TikTok parent ByteDance pursues global growth. The ecommerce gross merchandise value on Douyin (China’s TikTok) quadrupled to $100 billion from 2019 to 2021. TikTok took this “made in China” model to Southeast Asia and the UK and is now aiming for the US.
• US social commerce will grow twice as fast as China’s through 2026. Almost all new US digital buyers will be Gen Zers, whose shopping habits are still evolving.
• Early US leaders like Facebook and Instagram pull back. Companies are moving away from social commerce and doubling down on core advertising. TikTok’s share of users who are social buyers will surpass Facebook’s in 2024, per our forecast.