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New Report Shows In-App Spending on TikTok Continues To Rise

While TikTok’s in-stream shopping push hasn’t taken off as the company had hoped, consumers are spending money in the app, which should keep its expanded opportunities on this front open for some time yet.

According to new data from data.ai, TikTok users spent $3.8 billion in the app throughout 2023, up 15% year-over-year, and highlighting the massive opportunity that TikTok has to become a broader marketplace.

TikTok spend data 2023

And it’s not just in Asian markets where that spending is occurring.

As per data.ai:

Consumers in the United States are tied with iOS users in China for the amount of TikTok’s life-to-date revenue they’ve contributed. Both have generated approximately 30% of it alone, and together comprise 60% of the total, or about $6 billion. After that tie for #1, the top five markets are rounded out by Saudi Arabia at #2, Germany at #3, the United Kingdom at #4 and Japan at #5. Those four countries combined contribute about 13% of the app’s IAP revenue.

So while China, where TikTok has been a big success, is still seeing strong consumer activity, Western users are also spending in the app.

According to data.ai, which tracks app activity, TikTok Coins are the biggest money earner for TikTok at present. TikTok Coins enable users to purchase virtual gifts in the app, who can then trade them for real world currency.

TikTok Coins

Evidently, TikTok is creating a purchasing ecosystem to support artists in the app, though as noted, that hasn’t translated into a broader eCommerce marketplace, which TikTok has been pushing for, in order to capitalize on its opportunity.

In-stream shopping is now the main source of revenue for the Chinese version of the app, called “Douyin”, with in-app purchases now a common expansion of initial viewing activity.

Douyin Stores

TikTok’s been working to build the same in Western regions, but thus far, Western consumers have been less enthused by the potential of shopping on TikTok, though the spending figures here show that it’s not because of a hesitancy around general spending in the app.   

TikTok has seen success with in-app shopping in other Asian nations, including Indonesia, where it’s just secured a path to resuming its shopping push, after the Indonesian Government sought to restrict in-app sales due to concerns that it could impact local businesses.

So there is expanded opportunity for TikTok to sell products in-stream, it just hasn’t cracked the code on how to get Western shoppers to broaden their spending behaviors just yet.

Expect to see TikTok make an even bigger push on this in 2023, likely via food delivery purchases in-stream, which has already proven popular in China.

If TikTok can get more people spending more money in the app, that will enable it to build on its revenue, and revenue share potential, which could be key to maximizing its opportunities moving forward.

You can read data.ai’s full report here.

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