Mastering the art of discovery commerce with TikTok Shop

In general, I think that e-commerce brands need to embrace technology as well as communities to drive growth. This is Zendascansite where we dive into the latest trends and tech shaping the future of AI-powered experiences. Today, we're talking about Discovery Commerce, how content creators, smart algorithms, and live shopping are completely changing how we discover and buy products. It's no longer about actively searching for something. Think of this new experience like digital window shopping. Only each window is carefully curated to only include things you like based on, "We Follow," or what your interests are. It's a whole new ballgame for customer engagement in this seamless community-driven space, and live shopping, while relatively new in the US market is one feature that's catching on quickly. Nowhere is this more apparent than TikTok where nearly half a million live shopping sessions took place just over Thanksgiving weekend last year, and one beauty founder made $2 million in a single live stream. That should get everyone's attention. But what does a smart live shopping experience look like? Where does it fit into this new commerce ecosystem? And how should brands be showing up in these spaces to maximize their impact with customers? Here to help us answer these questions and dive deeply into the world of Discovery Commerce is JP Stoops, head of TikTok Shop's App Store. JP, I'm so excited to have you here. I know it's been super busy on your end, but I'm really glad we've been able to make this happen. Of course, yeah, first, well thanks for having me on. I'm excited to talk about this new world of shopping. All right, I do want to get into live shopping, but as we've discussed, the reality is that it's just one part of what is really an incredibly intricate ecosystem. So let's just step back a bit and talk about what Discovery Commerce actually is and why it's having such an impact. Sure. So Discovery Commerce brings together entertainment, personalization, and shopping. It's transforming how people find and buy products. So traditionally, we're all accustomed to searching for products online, right? I need to buy something so I search for a keyword or a brand. On TikTok, each person's for you feed is a bit different and personalized to the content you enjoy. So we rely on an interest graph instead of a social graph to deliver that personalized experience based on individual preferences. So by introducing shopping into this experience, users are discovering products. They may have not have otherwise known existed. And while TikTok has search capability, many users come across products they wouldn't otherwise find which creates a unique opportunity for brands to reach new audiences and connect with existing customers. So basically, I'm somebody that really likes hiking and camping. I know a couple of really big brands, instead of typing those brands into like a Google search or something like that, TikTok is picking up that, you know, these are things that I enjoy. It's maybe serving me up different kinds of brands that are producing camping and hiking equipment. Or it's maybe offering me something that I didn't even think about. Is that kind of what you're getting at here? Exactly. So you like camping and the outdoors and you might see some camping and outdoors products. Oddly, my for you page surfaces a lot of cleaning videos. I never knew how satisfying it was to watch a driveway being power washed or a getting clean, but apparently I do. So over the holidays, I found my FY page bringing up a number of cleaning products that I inevitably purchased. One was this electric scrub brush and another was this gel that cleans black mold stains. So I would have never purchased those products, had I not discovered them on TikTok as I obsessively watched their videos and demonstrations. Oh, it's funny. There are so many embarrassing things that could potentially pop up. I just pulled my screen up because I wanted to see what was happening here. And I've got a DIY video. It's basically trying to fix your baseboards by using some kind of tacky putty. So I do a lot of home improvement around here. I guess it's picking up on that. But I mean, just zooming out a little bit. I'm sure most people listening to this know roughly what TikTok is, but perhaps not TikTok shop. Can you speak a little bit about where you've fit into all of this? Sure thing. Yes. In 2023, we introduced TikTok shop and formally made it generally available in the US in September of that year. So it's really less than two years old and already making a big impact. So let me briefly explain how TikTok shop works. So users can discover products natively through four primary ways. First, our shopable videos. These are short videos found in the four-year feed with product links. And this is our shop page. This is the shop connected to the seller or creator's profile showing products they sell or recommend. Third, is shop tab. Shop tab is more of a traditional marketplace where users can browse and discover products. And finally is live shopping. So live shopping allows sellers and creators to live stream and demonstrate products, allowing for that one-on-one interactions with buyers. So as a user, you might be consuming content and come across shoppable content from a creator you love. You can simply add that product to your cart and continue to enjoy the content from that creator. Later, you may find yourself in a live stream or browsing on shop tab and find another product from a different seller. Users experience one simple checkout, no matter how many products from different sellers are in the basket. It simplifies the buying experience without disrupting the user experience and it accelerates the conversion into a few clicks. The beauty of TikTok shop is that brands and sellers don't need to be the ones that create the content, whether it's a video or a live shopping event. There's over a million creators on TikTok shop in the US alone. So sellers and brands can choose to expose their products to these creators through our affiliate collaborations. And this enables creators to post videos or host live streams and earn a commission. Nice. So this doesn't really feel like a place where you can kind of just show up and do what you were doing as a brand before. There's a lot of different things happening here. There are different considerations. It's not really like all about the glossy brand at anymore, but it's about these sort of almost customer testimonials. You can see things being used. There's like live demos. I think there's something really powerful about that. So talk to us a little bit about what it takes to really be successful as a brand in this discovery commerce environment. Sure. I'd say the first thing to do is to just get started. It's still very early days here. So brands need to be sure their products are showing up in their best possible light. So this means signing up to our TikTok shop seller center and syncing your catalog with the richest product detail pages to help improve that discovery. We have apps that help sync product catalog from your source, whether it's Shopify or another marketplace. From there, and this is easier said than done, but brands should not feel intimidated or feel like their content needs to be perfectly polished. It's authenticity that performs well on TikTok and there's no better way to be authentic than to empower one of our creators to help tell your story. So how do you kind of tell which, because I'm sure as a brand, signing up to something new and kind of breaking out of your comfort zone so to speak can be a little bit intimidating. I mean, is there a smart strategy when it comes to deciding what influences to or creators to go with or what kind of content might be resonating well with your audience? Are there best practices around that that you would recommend? Absolutely. Yeah. I'd say first, it's important to be present and to be on the platform. You don't necessarily need to create content right away. You can simply go in and search for your own brand or for products that are relevant to your brand. The results are going to show you what's performing well. And most often, that's authenticity in the form of creators already speaking about your brand. And so I think the first thing to do is to be present, take a look and see what performs well. If you see a creator you like, perhaps reach out to them. We have creator collaborations that allow you to do that. And from there, you can start to think about how you want to present your brand within TikTok and TikTok shop. I love what you keep saying around authenticity because I think that's just such an interesting way to think about it. The strategy is not necessarily to wow people with beautiful models or because I know there's There's a lot of people. of beauty brands on TikTok. But tell me, like, unpack that a little bit. I love to hear what a more authentic customer experience looks like and what that means in your view. Sure. Well, from a beauty brand perspective, I think we're all, particularly women, are accustomed to seeing beauty advertisements that portray a perfect example of whatever the end result is. In reality, on TikTok, that authenticity presents itself in the way where a creator is or the brand themselves is talking to the users, building that trust, having a back and forth with them to explain the challenges that they may have or how to apply a particular application of a product. So it's about that authenticity is about building trust with users, finding a community and telling your story in a way that is genuine and authentic. It's really powerful. I mean, I was browsing TikTok the other day and this video popped into my feed and it was an older woman. She was talking about how she was a smoker, tons of wrinkles, needed something that really could help her in that regard. And she was using this product and just looking into the camera, semi-harsh lighting, nothing was, you know, soft filter, anything like that. And she was just spreading it across her forehead and you could see what was actually happening. It was really smoothing out. It looked great. I mean, that to me was such, it was a much more convincing plug for this product than just seeing sort of an airbrushed person and a beautiful ad. And so what you're saying really resonates with me. I think it also really builds trust with customers because they feel like they're seeing first hand with the product can do, they're seeing real people, they see themselves reflected, you know, in that experience. And I think there's something really that's not only resonating with me, but resonating with other people when they're using this app and having these experiences. I mean, it's almost like you don't want to be perfect. It's about the imperfections that's really helping to build that level of trust. That's exactly right. Yeah. The content doesn't need to be perfect. It's all about storytelling and engaging with that audience in an authentic way. Speaking of that more authentic engagement, I'd love to pivot and talk about live shopping. It's something that has really interested us here at Zendesk. We touched on it last year during our Relate Customer Conference. I know it's just one part of this whole thing, but increasingly it seems to be a more important one. Can you give us a brief overview then of what exactly live shopping is and how it fits into this larger discovery commerce ecosystem on TikTok? Sure, absolutely. So live shopping is an interactive and engaging way of shopping that combines live video streaming with real-time purchases. So it allows brands, creators, and retailers to showcase products to viewers while answering questions and demonstrating features and interacting with the audience in real time. I'd say the roots of live shopping go back to the heyday of QBC and HSN. Those interactions were mostly one directional outside a periodic phone call where a viewer would ask questions. On TikTok, live shopping transforms the shopping experience into a dynamic social event. So shoppers can see products in action just as you described the application of the makeup in that example you brought up. They can ask questions directly and receive immediate responses. And this all brings back to that point of authenticity and trust. Given many of the creators are people the users already follow. So it's like watching a live TV shopping show, but with the added ability to interact and buy instantly. I mean, I went in and just watched one to sort of play around and see what it was like. But I sent a question into the host through the chat and he answered me in real time, which was really crazy. And then started kind of talking to me and asking me questions. I think prompting me to respond more in the chat. But it all felt really, really seamless. So I guess my initial question then is if I'm a brand and I'm on TikTok and I've got the whole thing kind of set up, how should I be thinking about live shopping within this larger strategy that I have? Where does it fit in? What are some of its strengths and maybe challenges? Sure. So brands should view live shopping as one pillar to their discovery commerce strategy. You know, this is very much the early days for us within live shopping in Western markets. The number of live shopping sessions hosted by creators has nearly tripled each month over the last year. And over Black Friday, Cyber Monday, one of our creators, Nikki Manage had the single highest live viewing session in TikTok shop history with over 172 million live stream impressions. And you mentioned at the intro, one of our creators stormy steel drove two million in sales during one live event where she sold over 100,000 units of her body glaze. That's wild. I mean, that is, those numbers seem really high. Is it mostly creators that are hosting these live streams or are brands, are you seeing a lot of brands put on their own live streams? How is that? How is that breaking down? Yeah, you know, it's it's it's an interesting mix. I think that the creators are the heartbeat of what makes TikTok what it is. And so leaning into creators and enabling them through collaborations is a very important strategy and will bring out the most authentic content. But brands themselves should also consider running their own live streams. And we would absolutely encourage that. What are some do's and don'ts when it comes to getting started? And would you say that this differs if you're a small brand versus a larger brand? Yeah. So I would say that brands want to ensure that that you have a good team, a good product and a good hook. The team starts with a presenter who who embodies your brand's identity. And for smaller companies, this could be the founder themselves. For larger brands, you might want to identify a creator. And as your audience grows or perhaps based on the size of your brand, you can scale your team as well as build out your set or your backdrop. But to start, I think there's nothing more authentic than a founder or a creator speaking to a product in an environment where they might use that product. You'll want to create quantity of both short content and have a go live cadence. So maybe it starts with just one video per week. But eventually the more frequently you post and go live, the faster you will learn and the greater the opportunity will be to get that organic traffic. From a product perspective, you'll want to have a good product. Some of our best categories include beauty, fashion, health, and home goods. And if you think about these categories, they have products that require explanation of details or of visual demonstration to help the user understand the benefits. So during the live, you'll want to watch the comments and engage with the audience as you experienced yourself. And it's okay to have that open conversation to answer questions posted by users. And finally, the last piece I'll share is that sellers should and brands should think about having a hook. And this could be by offering a discount or a giveaway or something as simple as free shipping that's only available during that livestream. Something you said that really struck me. I thought was very interesting because I wouldn't have necessarily thought about it as a natural fit. But this idea of a CEO or somebody connecting with customers directly. So imagine the main thrust of a live stream is to really sell products. But you said it's also an opportunity to directly connect with your customers and answer their questions and show a demonstration. Kind of really have that direct engagement that maybe doesn't really exist outside of a space like that. I think that's that's so interesting and different. Absolutely. It is about that two-way conversation. Some of it is with your current customers. And in that regard, you can get some great feedback on your product. I would imagine that there's quite a few brands who have come up with new product ideas just in those live stream back and forths or use cases they may not have known existed. I think it's important for brands to lean in, to listen, to their current customers, but also know that this is going to be an opportunity to reach new audiences because of that discovery commerce effect. Your products will be put in front of users and customers who may not have otherwise discovered you. In terms of mistakes or common things that brands are doing that maybe aren't resonating as well, or maybe undermining their larger discovery commerce strategy, what are some that you could highlight and how could brands avoid those mistakes? Sure. Once a brand or a seller is on the platform, on TikTok shops specifically, you need to be prepared to deliver. Now look, there's no guarantee or magic formula, but if your product goes viral, you need to be ready to fulfill it and to support it. So as a marketplace, we have strict shipping SLAs and customers have high expectations for customer support. And this is where integrations and apps become critical. So my team oversees the technology partners we expose as apps in TikTok Shop Cellar Center. This includes our integration with Zendesk for customer service. At this stage, over 70% of daily GMV is driven by an app connected cellar. So you can think about it. It makes sense. These integrations make it easy for sellers to not only add TikTok as a sales channel and bring that incremental GMV, but also do it without the burden of operating 100% in our platform. So the TikTok for Zendesk app unifies the cellar messaging, allowing for faster and more consistent support. It also helps sellers take care of cancellations and exchanges. And a new feature that we've rolled out is the ability to send personalized offers like coupons directly to buyers who have purchased from you in the past. That's so interesting because a lot of these sellers are, I mean, frankly, smaller businesses. Folks that maybe haven't had to think about supporting the past, but as you're seeing volumes go up more and more people coming in and purchasing or maybe like you said, you're viral and suddenly everybody's interested, there's a whole other component that happens on the back end in terms of supporting those customers after a purchase or trying to convert this high engagement into more of a long-term loyalty. So what comes next? I mean, where do you see all this going in the short or medium term? Is there anything coming down the pike or anything you're excited about as this trend evolves? Yeah, absolutely. I'd say maybe four key things. First, if I wasn't clear, influencer marketing or what we call creator collaborations, our key end will continue to grow. Second, that community centric marketing and engagement will be key. Successful companies and brands will focus on engaging with these communities rather than divergent generic mass marketed messages. And there's no better place where they can engage with these communities than on TikTok, whether it's within the comments of short videos or in a live shopping event. Third, I do think that short-form video will in the short term continue to dominate here in the US. Live is picking up steam. And finally, of course, it's 2025. I think generative AI will become more and more of an important tool. From a seller or a brand perspective, I look forward to seeing how features evolve and how developers build solutions that help brands doing things like writing a script or preparing them for that live selling event or give them content ideas. I love the shout out to generative AI because I feel like that's obviously a topic on everybody's mind right now. And just thinking through how a tool like that can really help brands show up more authentically and create content that feels like it connects better with the people that they're trying to reach. And really having that whole experience carried through from that initial discovery all the way to the end of the journey, which includes that support component that we talked about. All right, JP, thank you so, so much for joining us. TikTok's really at the forefront of all of this and I'm so glad that we were able to connect and chat. Is there anything else you'd like to share before we call it a day? I think we've captured it well here today. And in general, I think that e-commerce brands need to embrace technology as well as communities to drive growth. Brands that lean into creator collaborations and influencer marketing will drive the most authentic content and ultimately drive meaningful GMB. So thank you for hosting me and for your time.