This is a YouTube video titled "Why Brands Should Join TikTok Shop | Peak Season Tips" created in November 2023. The content is a detailed presentation or talk focused on e-commerce strategies, emphasizing the sales equation (traffic, conversion rate, average order value), the rise of TikTok Shop as a retail channel, and the growth of B2B marketplaces. It provides practical advice for brands on channel diversification, leveraging social commerce, and combining direct-to-consumer with wholesale approaches to maximize revenue in a complex retail environment. The speaker appears to be delivering expert insights rather than engaging in a multi-speaker conversation.
Foreign My first tip is to embrace and balance the sales equation. If you are an old school retailer, you understand this this old standard. But many newer entrants were never exposed to the sales equation. Simply put in green Traffic times conversion rate times AOV equals revenue. Those are your three main levers, all with compounding impact to revenue outcomes. Traffic, especially paid advertising, seems to get the lion's share of attention and conversations. But no matter how low your CPCs are or if you're on the coolest new TikTok shop, conversion rate and AOB are equal parts of the battle. If you have quality traffic but can double your conversion rate with better content or stronger views, you've just doubled your revenue, right? Measure and embrace all three to drive revenue and when all three improve, returns are exponential. Second, TikTok shop launched in October. If there's one overall main e commerce tip to leave you with, it's channel diversification. There are more than 40 different retail media networks in operation, with the majority being less than three years old. The association of National Advertisers released a study earlier this year that 56% of brands use more than five retail media networks, so specifically launched in September, TikTok Shop is the newest and arguably the hottest e commerce channel to hit this year. Early mover advantage. Retail Social commerce sales are forecasted to grow at over 2020% in the next five years and they account for nearly 8% or they will account for nearly 8% of e commerce sales come 2026. The number of consumers starting their product searches with Amazon is down year over year, still number one. But Walmart and the social commerce channels Instagram, YouTube and TikTok are all up. TikTok the biggest TikTok will gain nearly 10 million social buyers in 2023 and and that's more than the net increase of Facebook, Instagram and Pinterest combined. 40% of TikTok users will make a purchase on the platform this year. Currently, sales commissions for TikTok shop are only 2% versus a 15% industry standard, say on Amazon and Walmart. And CPCS are really less than a third, probably around 30 cents compared to some other channels. So back to that sales equation. If you can find cheaper, high quality traffic that converts TikTok shop is definitely something to give a hard look at and launch and advertise through shop ads and influencers and affiliates ASAP. Third, and this might be more of a 2024 tip, but B2B to C right? Driven by younger digital first buyers, the B2B marketplaces are enjoying triple digit sales percentage growth while Amazon B2B has a 32% share. There's over 500 US commercial and vertical specific marketplaces expected to grow over 50% in the next few years. B2B wholesale drives physical growth and brick and mortar retail continues to grow and it represents over 80% of US purchases. Mixing D2C and wholesale channels online and offline is really the best mix to prevail in this profit strained economy. You'll have wider reach, more products, increase your footprint, stronger brand recognition. Keep in mind sellers must have a centralized strategy for repricing product data optimization, syndication, advertising analytics and connections to your fulfillment your shipping partners. And then make sure you have a tight reseller policy. So hold wholesale buyers don't just pop up as direct competition in your D2C channels. For one of our own brands, Lumipets, we saw a 100% year over year revenue growth using a mix of physical retail expansion and B2B marketplaces like Fair Connections through Range Me and we're now selling products in over a thousand locations. In conclusion, the fragmentation and the complexity will continue.
