Sporting a shiny costume and a Santa hat atop her distinctly pink hair, Sarah Potempa stood in entrance of her smartphone at her hair-care firm’s warehouse in Waukegan, Illinois. It was time to go to work. 

Potempa is a celeb hairstylist who goes dwell on TikTok a number of occasions per week. Throughout “the packing present,” as she calls it, Potempa livestreams herself as she packs up orders of her viral Beachwaver curling iron for six to eight hours at a time. 

The stream on Nov. 20 had a celebration environment, with Potempa taking breaks to bounce to “In Da Membership” by 50 Cent in between transport out orders. To the greater than 1,000 TikTok customers who sometimes tune in for Potempa’s reveals, that is leisure and purchasing all of sudden. 

Beachwaver is a part of a rising inflow of shops which are flocking to TikTok Store, the video app’s purchasing service. TikTok Store launched in September 2023 as a means for customers to buy merchandise with out leaving the app, and since then, the China-owned app has emerged as a viable different for retailers trying to diversify their e-commerce enterprise from Amazon. 

By way of a devoted Store tab, retailers large and small promote merchandise of all types, starting from eyeshadow palettes, cellphone chargers, detox teas, treadmills and extra. On TikTok, retailers sometimes provide beneficiant coupons and free supply inside a couple of days. Shoppable posts, which appear to be regular movies however are adverts for merchandise bought in TikTok Store, often seem in TikTok’s primary video feed, often known as the “For You” web page. These posts permit customers to buy merchandise with out exiting their For You feed.

On Potempa’s present, buyers race to position an order to get a 50% low cost on Beachwaver merchandise and free add-ons to their order like face washes or lipsticks, together with the prospect to have their username learn aloud by Potempa whereas she packs their order on display.

“When TikTok Store was new and folks hadn’t used it but, they’d ask, ‘Is that this on Amazon but?’” Potempa stated in an interview. “I might get these questions like, ‘Can I purchase it someplace else?’ Now that it’s been round for a yr or so, we’ve completed 1.2 million orders.”

ByteDance-owned TikTok has already cemented itself as an promoting powerhouse, and with TikTok Store, the corporate has been attempting to carve out one other income stream by way of e-commerce. The corporate has attracted the likes of Nike, PacSun and Crocs, amongst others. These retailers need to faucet into the greater than 170 million Individuals on TikTok who store on impulse as they scroll by way of movies. 

They aren’t the one ones. 

Amazon sellers are additionally being persuaded to check out the service with guarantees of low charges and steep reductions on merchandise footed by TikTok. In addition to sellers, the corporate has additionally employed expertise away from Amazon, filling key roles for TikTok Store in areas like advertising, creator relationships, model security, class managers and operations.

Within the 15 months since its launch, TikTok Store has emerged as a “large e-commerce machine,” in accordance with ecommerceDB, a market analysis agency. EcommerceDB predicts TikTok Store will greater than double its gross merchandise quantity, or the greenback worth of things bought on its market, to $50 billion this yr. That’s a fraction of Amazon’s 2024 anticipated GMV of $757 billion, however nonetheless, TikTok Store is making strides.

“Each time you scroll, each different scroll is a Store publish, so that they’re making numerous funding to encourage that in-app conversion,” stated Caila Schwartz, Salesforce’s director of client insights and technique for retail and client items.

Amazon spokesperson Mira Dix instructed CNBC in an announcement that sellers are partaking with its retailer “greater than ever earlier than” and seeing larger success. Dix stated the corporate’s companies for sellers are non-compulsory, corresponding to achievement, which prices “a mean of 70% much less” than comparable two-day transport alternate options.

“Our promoting companions are extremely vital to Amazon, and we work laborious to innovate on their behalf and assist the expansion and success of those companies throughout all of their gross sales channels,” Dix stated.

Beachwaver CEO Sarah Potempa hosts livestreams on TikTok Store a number of occasions per week.

Looming deadline

TikTok’s e-commerce push comes at a precarious second for the corporate. 

In April, President Joe Biden signed a legislation that requires ByteDance to promote TikTok by Jan. 19. If TikTok fails to chop ties with its father or mother firm, app shops and web internet hosting companies can be prohibited from providing the app, amounting to a nationwide ban within the U.S. TikTok has sued to dam the measure.

President-elect Donald Trump may rescue TikTok from a possible U.S. ban. After attempting to implement a TikTok ban throughout his first administration, Trump reversed his stance, acknowledging in a March interview with CNBC’s “Squawk Field” that “there’s numerous good and there’s numerous dangerous” with the app. Trump modified his place across the time that he met with billionaire Jeff Yass, who’s a significant investor in ByteDance.

Because the January deadline grows nearer, TikTok has largely been working its enterprise as normal. 

Executives from TikTok Store pitched its market as a vacation purchasing vacation spot throughout an October occasion in Manhattan with enterprise house owners and social media influencers. Customers have shopped tons of of thousands and thousands of models on its e-commerce platform since launching September 2023, stated Nico Le Bourgeois, TikTok Store’s head of U.S. operations. Le Bourgeois, who joined TikTok in August 2023, beforehand spent almost 9 years at Amazon in a wide range of divisions together with its third-party market.

TikTok Store isn’t attempting to promote “every little thing to everyone,” Le Bourgeois instructed CNBC in October. TikTok Store is a market for product discovery that surfaces “new, cool, fascinating” gadgets from large and small manufacturers, he added.

“You see it, you prefer it, you purchase it. It’s not a search,” he stated. “It’s a really totally different means of purchasing.”

Le Bourgeois declined to touch upon the looming TikTok ban, however an organization spokesperson on the occasion stated TikTok Store isn’t slowing down.

“The sellers right here, creators, they’re constructing their livelihoods on TikTok,” the spokesperson stated. “We’re going to proceed to point out up for that. There’s an enormous alternative for us.”

‘Having fun with it whereas it is sizzling’

Extra Individuals are anticipated to show to TikTok and different China-linked apps for reward shopping for this vacation purchasing season. 

Roughly 63% of Western customers plan to buy from Chinese language purchasing apps in the course of the season, in accordance with Salesforce. That features TikTok, Alibaba’s AliExpress, Shein, Temu and fast-fashion firm Cider.

On Saturday, TikTok stated its U.S. Black Friday gross sales topped greater than $100 million, with residence items, vogue and wonder merchandise among the many hottest classes. Canvas Magnificence, a prime vendor of hair-care and wonder merchandise on TikTok Store, hit $1 million in gross sales inside two hours of going dwell on the app, the corporate stated.

Retailers and sellers, a few of which depend TikTok for the lion’s share of their on-line gross sales, instructed CNBC that they’re sticking with the platform regardless of the likelihood that it may disappear.

Though it’s unattainable to disregard the dialog round a possible TikTok ban within the U.S. as a model that closely depends on the platform, Yay’s Snacks co-founder and COO Rachel Cheng stated she’s not satisfied that TikTok will go away underneath the Trump administration as a result of it doesn’t appear to be the president-elect’s primary focus.

Yay’s Snacks, which makes crispy Cambodian beef jerky, was one of many earliest corporations to affix TikTok Store when it launched. Yay’s founder and CEO Marlin Chan, a former YouTuber, often posts humorous TikTok movies selling his snacks, that are primarily based on his grandmother’s authentic recipe. Among the many movies is a collection that parodies the present “Undercover Boss.” These movies helped Yay’s amass tens of 1000’s of TikTok followers, who hold shopping for the jerky, Cheng stated.

At one level, TikTok gross sales comprised almost 90% of Yay’s whole income, with month-to-month gross sales from the app peaking at $75,000 final November, Cheng stated. Yay’s is ready to divert to Amazon and its personal web site if TikTok is banned, however so long as TikTok is “nonetheless right here, we’re going to do what we are able to to remain on prime,” Cheng stated.

“If we had been sitting right here worrying about what’s subsequent, we might’ve by no means gotten on TikTok Store,” Cheng stated. “We’re having fun with it whereas it’s sizzling.”

Competing with Amazon

Scrub Daddy, identified for its smiley face-shaped sponges, went viral on TikTok in the course of the Covid pandemic and counts greater than 4 million followers. Its prime video, an illustration of its Damp Duster sponge, has 30 million views whereas its bestselling product on TikTok Store has been bought almost 76,000 occasions, in accordance with the app. That determine doesn’t account for gadgets which have been returned after buy.

After kicking off in 2012 with an look on “Shark Tank,” Scrub Daddy CEO Aaron Krause stated he misplaced religion in conventional advertising efforts. 

“We did a TV advert, we did some out of doors adverts on billboards, we did somewhat little bit of radio,” Krause stated. “All I discovered was that I used to be throwing cash into the air.”

The corporate pivoted towards social media advertising, totally on Instagram, which turned out to be a “pot of gold,” Krause stated. Scrub Daddy arrange an account on TikTok in 2020 and labored with influencers to advertise its merchandise, together with Vanesa Amaro, a preferred account for housecleaning content material with greater than 5.7 million followers. After Amaro really useful the sponges to her viewers, Scrub Daddy bought 30,000 models in a single weekend, Krause stated.

TikTok’s “algorithm simply permits you to hit thousands and thousands and thousands and thousands of views with one hysterically loopy video,” he stated.

In current months, TikTok has inspired retailers and sellers to host hourslong livestreams a number of occasions per week as a option to join with buyers. Many manufacturers have invested in constructing out their very own studios to document the reveals or have employed expertise to host them. 

Scrub Daddy snatched up longtime QVC host Dan Hughes after he was laid off from the house purchasing firm in 2023. Others, like Beachwaver, have turned their CEOs into on-screen expertise.

TikTok Store was a giant matter of dialog at a convention for Amazon sellers in New York in October. A session on “easy methods to scale your model” with TikTok Store drew a packed room of sellers who listened to e-commerce strategist Rafay MH speak up the potential for manufacturers to haul in $8 million to $10 million in gross sales from TikTok in lower than a yr. 

“Amazon comes with a ton of competitors,” MH stated. “TikTok is the chance without cost eyeballs and gross sales.” 

Many Amazon sellers have embraced TikTok after they had been initially gradual to affix the platform, stated Michelle Barnum Smith, who supplies consulting companies to on-line companies.

“I used to be the bedraggled gold miner standing on the road corners of New York, saying ‘There’s gold in these hills,’ and folks had been like, ‘Yeah, certain,’” Barnum Smith stated “However as quickly as they began seeing their competitors on there, or their buddy on there, they had been like, ‘I’ve obtained to get on there.’”

There’s now “excessive FOMO,” or concern of lacking out, amongst Amazon sellers to affix TikTok even when it not exists within the U.S. subsequent yr, Barnum Smith stated.  

“Regardless of the future seems like for TikTok Store, they’re joyful to take that cash now and get whereas the getting’s good,” Barnum Smith stated.

Disclosure: CNBC owns the unique off-network cable rights to “Shark Tank.

Annie Palmer, CNBC

Annie Palmer is an affiliate tech reporter for CNBC.