NEW YORK (Reuters) – Canadian e-commerce company Shopify said on Tuesday it will partner with TikTok to help its one million-plus merchants more easily advertise their products on the video-sharing app, as it looks to grow its customer base.
The link-up with Shopify, which provides an e-commerce platform and distribution services to mostly small and medium-sized businesses, comes as a proposal for Walmart Inc to buy a stake in the Chinese-owned firm is stuck in limbo.
Shopify said the partnership will allow its merchants to sell product in the form of shoppable video ads, where TikTok users can click on an ad to buy the product.
All transactions will happen via Shopify’s site, helping the Toronto-based firm drive sales online, while the two companies “will also collaborate to test new commerce features” over the coming months, it said.
“We’re thrilled to be the first partner to welcome TikTok to the world of commerce, particularly right now, as our merchants prepare for a busy online holiday shopping season,” said Satish Kanwar, VP of Product at Shopify.
TikTok, which reaches 100 million U.S. users a month, said it was always looking for new ways to connect brands with its users.
“Shopify is a perfect partner to help us grow and expand our commerce capabilities globally,” Blake Chandlee, Vice President, Global Business Solutions at TikTok, said in an emailed statement.
The two companies did not provide financial details about the tie-up.
“TikTok aggregates a massive audience for branding and as a Shopify user, you can allow third party advertisers to use your videos you upload in their advertisements,” said Mark Boidman, managing director and head of media and tech services at boutique investment bank PJ Solomon.
“This is key for TikTok users who have good content and lots of followers.”
Walmart has been looking at a deal with TikTok to boost its advertising strategy by helping the world’s biggest brick-and-mortar retailer engage with younger audiences, but the talks to invest remain shrouded in political uncertainty.
A U.S. appeals court hearing is expected on Nov. 4 on whether to allow the U.S. government to bar transactions with TikTok, a move that TikTok warned would effectively ban its use in the United States.
In June, Walmart also partnered with Shopify to expand its online marketplace business and capture a bigger slice of the coronavirus-driven surge in online sales.
(Reporting by Melissa Fares in New York; Editing by Richard Pullin/Mark Heinrich)
