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Shopify Helps TikTok Step Into eCommerce
To the surprise of no one, Tiktok is furthering its foray into eCommerce. The company announced an expanded partnership with Shopify, as well as a pilot test of TikTok Shopping among select Shopify merchants across the U.S., U.K., and Canada to round out the rest of the year.
For the first time, Shopify merchants with a TikTok For Business account will be able to add a shopping tab directly to their TikTok profiles and sync their product catalogs to create a mini-storefront that links seamlessly to their online store for checkout.
These companies have a history. The social video platform first announced its plans to partner with Shopify last October, introducing new tools that allowed Shopify merchants to create, run and optimize their TikTok marketing campaigns directly from the Shopify dashboard. They also added some new integrations within the TikTok For Business Ads Manager.
The new deal takes this a bit further. iconic businesswoman and social media master Kylie Jenner is among the early adopters of the new service. She will use the feature with her Kylie Cosmetics brand, which will be available to shop directly on TikTok.
The partnership makes a lot of sense for both companies, TikTok is one of the world’s fastest-growing entertainment platforms, with hundreds of millions of active users. From February 2020 to February 2021, installs across Shopify’s social commerce channels increased by 76%. It’s a match made in eCommerce heaven.
Amazon Partners with Affirm
Amazon is entering the Buy Now, Pay Later (BNPL) sector. The industry is booming with no signs of slowing down, so the move makes sense for a heavy-hitter like Amazon. Affirm’s Buy Now, Pay Later checkout option will now be available to certain Amazon customers in the U.S. starting Friday. A broader rollout is also coming up in the coming months. The partnership will allow Amazon customers to split purchases of $50 or more into smaller, monthly installments.
Affirm’s stock shot up to 48% after-hours Friday on the news, adding over $8 billion to its market capitalization, later settling up around 33%. Amazon’s shares were unchanged. The BNPL company said some of the Amazon customer loans will bear interest, but some will come with 0% APR. Other installment-type options are available on Amazon through credit cards.
Affirm may be a major player in the Buy Now, Pay Later area of eCommerce, but the competition is tight. Payments veteran PayPal is also dipping its toe in the sector. PayPal rival Square (SQ) recently announced a $29 billion acquisition of Australian firm Afterpay for $29 billion.
Klarna, a popular Swedish startup is also proving to be tough competition for other BNPL firms. The company is currently valued at nearly $46 billion. That makes it the world’s fourth most valuable privately-owned unicorn, according to CB Insights. Klarna trails only Chinese TikTok owner Bytedance, payment processing firm Stripe, and Elon Musk’s SpaceX.
Urban Outfitters Introduces Nuuly Thrift
As sustainability initiatives become increasingly important to consumers, large retailers are scrambling to figure out a way to integrate planet-friendly projects into their business models. Urban Outfitters is the most recent company taking on a more green project. Urban Outfitters is launching a marketplace for secondhand goods, seeking to turn its customers into sellers and keep them from turning to popular online re-sellers like Poshmark and thredUP.
Nuuly Thrift, launching as an iPhone app this fall, will join a growing list of peer-to-peer services from large retail chains. It’s acting as a sister platform to Nuuly Rent, URBN’s subscription rental service that rolled out in 2019. The program was on an upward climb, until Covid.
However, this past spring, Nuuly Rent rebounded to pre-pandemic subscription levels, and now has 30,000+ subs. URBN is hoping Nuuly Thrift will revive Nuuly Rent and vice versa. Next year, customers will be able to pay for their Nuuly Rent subscriptions with Nuuly Cash earned via the Thrift marketplace, proving this move to be mutually beneficial.
According to a recent ThredUp report, the secondhand market is expected to double to $77 billion by 2025. That juicy number, plus the low overhead of a peer-to-peer platform, is enticing to retailers, especially URBN after such a chaotic year.