ByteDance platform Douyin tightens its e-commerce policies to compete with Alibaba and JD.com ahead of Singles’ Day festival
- Douyin’s move to build a closed-loop for its e-commerce business and monetise its popular live-streaming platform did not surprise analysts
- Douyin is loosening ties with third-party e-commerce platforms to prepare for the Singles’ Day shopping festival on November 11
Merchants must also use Douyin’s own digital marketing matching service to find key opinion leaders (KOLs) and cannot promote products from third party e-commerce websites through its live streaming service “in order to further protect the rights and interests of consumers,” according to a statement from Douyin’s representative.
The Douyin representative said the measures would not affect accounts that run shops on the platform and products sold through short videos.
The KOL move is effective September 6 while the ban on third party links will take effect after October 9.
Analysts were not surprised at Douyin’s move to build a closed-loop for its e-commerce business and monetise its popular live-streaming platform instead of just being a channel that directs consumers to other platforms.
“It’s not unusual for China’s tech companies to create walled gardens as they become huge,” said Mark Tanner, managing director at Shanghai-based consultancy China Skinny. “ByteDance appreciates that the highest income in China comes from clicking the ticket on transactions rather than annoying customers with too much advertising. Given their increasing share of screen time, they are underperforming on this front and have ambitious targets to change that.”