TikTok to pause European e-commerce push to focus on US market

European brands and retailers who rely on social commerce to sell their collections will be disappointed to hear TikTok is pausing its European shopping platform as it focuses on the growth of its US market.

The shortform video parent ByteDance has been under intense scrutiny in the US, where government officials oppose TikTok because of its ties to China, saying the app is a potentical national security concern.

ByteDance postponed the rollout of its shopping platform across Spain, Germany, Italy, France, Ireland, Mexico, and Brazil, reported Bloomberg, to focus on strengthening its position in the U.S. market, where it has 170 million monthly users. ByteDance aims to counteract merchant hesitation due to a potential U.S. ban by demonstrating the platform's value. The company targets a tenfold increase in U.S. merchandise volume to 17.5 billion dollars this year, Bloomberg said, despite regulatory scrutiny and competitive pressures.

TikTok Shop, the fastest-growing feature of ByteDance's social media app, combines video content with e-commerce to distinguish itself from rivals like Instagram and YouTube. Although its UK launch faced challenges, TikTok has since partnered with high-end local brands for smoother market entries. In the U.S., ByteDance is battling a divestiture mandate from President Biden, arguing it is unfeasible, and has ramped up incentives to attract creators and merchants.

The European Commission has also launched a probe into TikTok, focusing on its TikTok Lite app in France and Spain. This inquiry is part of the Digital Services Act (DSA) enforcement, which requires large online platforms to evaluate and mitigate potential risks before introducing new features.

The Commission is particularly concerned about TikTok Lite's "Task and Reward Program," where users earn points for activities like watching videos and inviting friends. The investigation will examine whether TikTok assessed and addressed the risks of this program, especially its potentially addictive nature and the lack of effective age verification to protect children. This new probe follows an earlier investigation into similar issues with TikTok's main platform.