ByteDance-owned Douyin, the Chinese version of global hit short video platform TikTok, missed its target gross merchandise value (GMV) in the first half of 2024, according to a local media report, amid weak consumer spending and increased competition in the domestic e-commerce market.
Douyin, which launched a stand-alone shopping app in March, recorded a lower-than-expected GMV of 1.4 trillion yuan (US$193 billion) in the first six months of the year, compared with its previous goal of 1.5 trillion yuan, according to a report on Thursday by Chinese media outlet 36Kr, which cited an unidentified source.
Douyin’s e-commerce growth rate slowed to 30 per cent after the second quarter, down from more than 60 per cent achieved in January and February, according to a report by LatePost.
That was in line with a June estimate by Goldman Sachs, which forecast Douyin’s GMV growth rate to hit 24 per cent this year, a steep decline from 60 per cent and 80 per cent in the previous two years, respectively.
A representative of Douyin’s e-commerce unit on Thursday said the 36Kr report was inaccurate, but declined to comment on the LatePost’s account of slowing growth.
ByteDance-owned Douyin’s logo seen atop its corporate building in Chengdu, capital of southwestern Sichuan province. Photo: Shutterstock
Still, Douyin published selected figures on Wednesday. It said combined sales of individual influencers rose 43 per cent year on year during the period from July 1, 2023 to July 1, 2024, boosted by the 5.28 million e-commerce influencers that joined the platform last year.
The decline in Douyin’s first-half GMV growth rate can be mainly attributed to an intense price war in the domestic e-commerce industry, as the country’s economy continued to sputter amid sluggish domestic consumer spending.
The average cost of retail orders on Douyin, for example, fell about 40 per cent to 80 yuan, which dragged down overall sales in the first half, according to the 36Kr report.
Online shopping via Douyin began in 2018 as a click-and-buy function within the short video app, similar to how TikTok Shop fused overseas users’ online entertainment feed with impulse buying.
There are signs, however, that the domestic price war may be near its bottom. Douyin, for example, has tweaked its recommendation algorithm to not label a product as “the cheapest online”, according to a report on Wednesday by Shanghai-based media Jiemian.
