TikToks influence on eCommerce sales growing – report
- Friday, June 9th, 2023
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UK consumers spent a total of £7.8bn online in May 2023, down 2.5 per cent from the previous month, and down 1.3 per cent year-on-year, according to the latest Adobe Digital Economy Index data from the UK.
Considering the impact of the additional Coronation Bank Holiday – which saw spending drop by 20.4 per cent compared with the same weekend in 2022 – Adobe said that Mays improving figures show early signs of consumer confidence and online spending power returning.
For the first time, the Adobe Digital Economy Index took a detailed look at how social media platforms drive traffic to eCommerce websites, and in particular, how newer platforms like TikTok continue to eat away at the share of social media traffic of established players, like Facebook and Instagram.
In May 2023, Adobe’s analysis identified a significant rise in eCommerce traffic from TikTok content, growing 378 per cent since January 2022. While TikTok’s overall visits share is relatively small (less than 5 per cent), it is growing at an impressive rate with 164 per cent year-on-year growth in May.
In contrast, Instagram’s share of traffic was down 2 per cent year-on-year, and Facebook was down 18 per cent, suggesting a growing capacity for TikTok to influence eCommerce sales.
UK consumers racked up another £1.3bn of Buy Now Pay Later debt in May (equivalent to 16.5 per cent of total online spending for the month), taking total spending on these services to £6.2bn for
Adobe’s analysis also revealed a 6.5 per cent increase in average order values using Buy Now Pay Later compared with April, and an acceleration in the amount spent using Buy Now Pay Later from 18 May onwards, indicating that consumers are more reliant on BNPL services in the run up to payday.
“While the prices of essential items like groceries continue to increase in price both online and offline, the year-over-year decrease of just 1.3 per cent in online spend for May shows that spending power and consumer confidence is starting to return,” said Suzanne Steele, Vice President and Managing Director for Adobe in the UK.
The online price of essential items continued to grow in May, with groceries costing 1.2 per cent more than the previous month (9.7 per cent more than last year). The prices of pet products also grew by 0.7 per cent compared with the previous month. In contrast, non-essential items such as electronics and apparel saw another month of falling prices as retailers seek to stimulate demand.
The analysis also found that the trend towards mobile shopping is continuing, with 59 per cent of purchases taking place on smartphones, in May, representing a 13.9 per cent year-on-year increase. Overall, consumers spent £4.6bn via their mobile devices in May.
The Adobe Digital Economy Index (DEI) uses Adobe Analytics to analyse tens-of-billions of visits to retail sites from UK consumers, 100 million SKUs, and 18 product categories in the period 1 May to 31 May 2023.