TikTok Halts Launch of E-commerce Platform in Mexico

TikTok has suspended the launch of its e-commerce platform in several countries, including Mexico, which was initially scheduled for July. It remains unclear if or when the company will resume the launch.

The decision to halt the e-commerce rollout might be connected to TikTok's focus on growing its platform in the United States, where it faces a potential ban, according to Marketing4E-commerce. The app currently boasts 170 million monthly users in the United States, but is contending with legislation aimed at banning it over national security concerns. President Joe Biden has shown support for the legislation, emphasizing the need to strengthen national security. In response to these challenges, TikTok is increasing subsidies and other incentives to mitigate the situation. 

TikTok Shop was being designed either as a separate application or an integrated feature within the social media app, aiming to compete with giants like Alibaba and Amazon. It sought to attract independent sellers. Initially, the e-commerce feature was to be launched in Spain, Germany, Italy, France, Ireland, Mexico, and Brazil.

TikTok has announced new advertising tools that offer enhanced creativity, better measurement, artificial intelligence, and automation. This move aligns with its strategy to capitalize on its growing user base and engagement.

According to the "Digital 2024" report by Hootsuite and We Are Social, TikTok usage in Mexico shows significant engagement, as users spend an average of 45 hours and 1 minute per month on TikTok, opening the app 409.5 times on average. The platform is more popular among women (86.2%) than men (74.9%) and the main reasons for using it include staying in touch with friends and family (60.3%), reading news stories (44.9%), filling free time (43.7%), searching for content (41.8%), and finding products to buy (32.6%).

Many advertisers in Mexico and across the region have increased their budgets for TikTok due to its appealing content format, ability to reach specific segments, effective reach, and low costs. More than a third of advertisers spend over 50% of their marketing budgets on TikTok, a figure expected to rise, while 35.1% allocate between 30% and 40%, while 2.7% spend around 10%, with plans to increase this investment over time.