While TikTok and its Chinese-based owner ByteDance has been given a stay of execution by incoming American president Donald Trump, the hugely successful social media app is still facing an uncertain future. How could a potential ban affect UK retailers and social commerce brands who have made TikTok their home?
TikTok has become an essential part of any retailer’s strategy, with users spending on average 95 minutes per day on the app and over 2.8 million customers making a purchase through TikTok shop in 2023 alone.
Unfortunately for retailers who have found a useful sales channel in TikTok, what makes it such a powerful social media channel – it has more than 170 million users in the US alone – combined with the fact it is owned by a Chinese company has sparked serious national security concerns across the political divide in the United States.
Worried that the app’s powerful reach could be used as a Trojan horse to spy on its citizens, Congress passed legislation to ban TikTok in the US in April 2024, which is set to come into effect this weekend.
TikTok did in fact go down in America for around 12 hours over the weekend. However, incoming president Trump appears to have won it another 90 days in the US, as he pushes for ByteDance to sell the app to an American-based owner.
With the future of TikTok still facing an uncertain future, how could its potential ban in the US affect UK businesses and consumers?
What is TikTok social commerce?
Social media has revolutionised brand discovery. Algorithms capture user behaviour and use insights to inspire scrollers with tailored product suggestions. It’s no surprise that TikTok ads far outperform TV ads. Brands will need to shift their ad spend to replicate this success.
Social commerce merges social media with shopping by adding buy buttons. Customers checkout from the comfort of TikTok, instead of being redirected to another website, setting it apart from typical social media marketing.
This has been a game changer; improving engagement, building trust, boosting conversions and reducing cart abandonment.
Last year, it generated $8bn (£6.55bn) in sales. With TikTok beating its competitors with a screen time of 26 hours per user per month, which in turn has massively influenced customer’s purchasing patterns.
Even in the post-TikTok US, TikTok Shop will have a long-lasting impact on consumer behaviour. Now that users are now familiar with buying products on social media, they will willingly transition when the gap is filled.
As search engine agency Local Falcon chief executive David Hunter explains: “The creator economy has consistently shown its ability to adapt and innovate in adversity. When TikTok was banned in India in 2020, platforms like YouTube and Instagram responded swiftly by enhancing their short-form video formats, and consumers quickly embraced these alternatives.
“We expect a similar evolution in the US, with Instagram Reels, YouTube Shorts, Snap Spotlight and emerging competitors such as China’s Red filling the gap.”
How the US TikTok ban will impact UK social commerce
But will the US TikTok ban spark a ripple effect that reaches British shores? Charlotte Quince, founder of marketing agency Quince Creative, believes it’s unlikely.
“Historically, bans in one region have rarely influenced user habits elsewhere. Facebook is banned in China, Russia and Iran, yet remains widely used in the UK,” she says.
The US ban might “heighten awareness around privacy” and retailers should monitor developments, adds managing director of influencer marketing agency Summer, Mischa Joslin. However, she believes this “won’t compete with the obsession and love Brits have for the platform”.
While Williams Commerce head of paid media Matt Hogan thinks that “a ban could raise questions about the platform’s long-term stability, leading some users or brands to shift their focus elsewhere” and “retailers should monitor developments closely,” he “wouldn’t expect a significant decline in UK usage solely due to the US situation”.
Investing in TikTok social commerce remains a top priority for retailers. Young consumers prefer seamless shopping experiences integrated with social platforms and impulse buying is on its way up.
The UK social commerce industry is predicted to double in the next four years to 10% of the total online commerce market, up from 6% today, according to a Retail Economics report.
“Social commerce is no longer a ‘nice-to-have’ but a critical component of retail strategy,” adds Summer’s Joslin. “By 2025, global social commerce sales are projected to reach $1.2trn. Social networks are not just places to discover products. They’re now fully operational sales channels.”
“TikTok remains one of the most cost-efficient platforms a marketer can use in terms of reach, engagement and conversion. With no direct competitor, it is indispensable for advertisers looking to drive conversions effectively,” adds Quince.
Potential global repercussions
TikTok has argued that the ban may be a slippery slope to the US banning other companies on the same grounds. As for other countries banning TikTok, however, the chances are low.
Williams Commerce’s Hogan says: “I don’t think it will guarantee further bans across other countries. But we could expect to see other countries pay more attention to TikTok and their practices. It could spark a closer investigation into TikTok as a platform or even how individual countries regulate social platforms.
“For retailers and marketers, we should pay close attention to any developments that may happen and be ready to adapt our approach should things change.”
“The US is willing to make quite an extreme move but, in Europe, for example, GDPR already enforces stringent data privacy laws that offer a safeguard without outright bans,” explains Joslin.
“What could be interesting is that the ban may cause ByteDance to reconfigure TikTok’s structure or policies to mitigate bans in major markets. If this happens, it could reassure UK users and make the platform feel more assured in this country, helping to negate any issues too.”
Will all this in mind, what do experts recommend retailers do to brace themselves for the TikTok ban?
“Retailers should also focus on building first-party data and robust owned channels: email lists, websites and loyalty apps to cushion against disruptions,” says Summer’s Joslin.
“All platforms have an element of risk, so no retailer should put all their eggs in one basket – blending your approach whilst building your own data is a chance to safeguard against risk for the long term.”
Quokka Agency director Charlotte Sheridan adds: “It’s worth noting that all three major platforms – Meta, TikTok and X are all having user trust issues at the moment. So it’s best not to be reactive, but to have plans should performance decline.”
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