TikTok’s Chinese Counterpart, Douyin, Is Courting American Designers

TikTok’s imminent banishment in the US hasn’t stopped its parent company, ByteDance, from trying to lure American brands to sell on TikTok’s Chinese counterpart, Douyin.

It’s already bagged one such brand: Bad Binch TongTong. The New York-based conceptual label — which has made waves with its dresses with exaggerated hooped and Octopus-shaped hemlines — is planning to launch a digital flagship store on Douyin in the next week.

The label, which sells in China through partners like Net-a-Porter, chose Douyin for its first online storefront over e-commerce giants like JD and Alibaba because it drives most of its sales from its social-media content, according to Terrence Zhou, Bad Binch TongTong’s founder and creative director.

“There isn’t a platform like Douyin where you can interact, share, repost and leave a comment and see live streaming and possibly convert to potential sales,” Zhou said.

Zhou added that he wasn’t concerned about selling through Douyin while TikTok is forced to find a buyer or get banned in the US. (The US signed into law on Wednesday a bill that requires ByteDance to divest TikTok or face the app being banned.) Douyin did not comment on the ban.

Douyin has been courting fresh American talent — with or without any established ties to China — to the e-commerce platform it launched in 2020 as more of its users express interest in emerging US brands. More sellers also give the company, which sells 30 billion items through its platform each year, a chance to defend its growing share of China’s e-commerce market.

At a seminar the company held in New York last month for a small group of prospective sellers, Douyin made its pitch to brands by outlining its solutions for the logistical challenges of selling in China. For starters, it ensures brands are authorized to sell in the region. It also has warehouses where merchants store their products for closer last-mile delivery, and a built-in cross-border payments feature for easy currency conversion.

Thus far, Bad Binch TongTong is the first indie brand to take the bait, but it probably won’t be the last.

For US brands, selling in China has gotten harder post-Covid. The country is slogging through an economic recovery as middle-class shoppers tighten their belts and contribute to deflation. While geopolitical tensions with the US don’t seem to have hurt consumers’ appetite for American brands, local consumers have been increasingly seeking out homegrown labels. Newer brands entering the region won’t get automatic clout from being foreign and have to develop an emotional connection with consumers.

But Douyin, which is known for pushing lower-priced items and special offers to its 600 million daily active users, could be a tricky place for indie designers hawking premium-priced goods to find an audience without hurting brand equity, said Iris Chan, partner and head of international client development at brand consultancy Digital Luxury Group.

“From a social perspective, it totally makes sense,” Chan said. “From a commercial perspective, once they open that, the question is ‘what is it doing to your brand?’”

Still, Douyin has a potentially irresistible proposition for young American brands: consumers that love to shop on social-media platforms.

Brands in the US rely on channels like Instagram and TikTok to connect with their audiences and create desire for their products. But converting the “likes” they get there into purchases has proved difficult. (Instagram removed its Shop Tab from its homepage in February 2023 because commerce wasn’t embraced on the platform.) As TikTok users bemoan their algorithmic feeds showing endless videos of people pushing goods, Douyin’s users go to the platform for that very reason.

At the seminar, Douyin also touted its track record helping the more than 700 American brands that already sell on its platform — including Calvin Klein, Fenty Beauty and Dermalogica — turn entertaining content into sales. Douyin users are particularly ravenous for brands’ live streams. That’s to be expected as live streaming accounted for nearly 20 percent of all e-commerce sales in China in 2023, according to estimates from eMarketer. According to Douyin, surf-inspired retailer PacSun generated $17 million in gross merchandise volume — a measure of goods sold through a marketplace — on its platform in 2023, with 80 percent of that coming from its live streams.

Skincare maker Dermalogica has also seen success from live streams, generating $1.3 million in sales each month from its live sessions, Douyin said. The brand has had a storefront on the platform since July 2022 that now accounts for half of the company’s sales in China. It runs live streams for at least 16 hours each day during which members of its team talk about skin maintenance, explain the features in its $60-$90 exfoliators, cleansers and moisturisers and introduce new goods. It also uses live feedback from fans to gauge which new concepts it should develop into products. Those efforts have helped Dermalogia establish a connection with Chinese consumers, even as the quality and appetite for homegrown competition continues to grow, said Aurelian Lis, Dermalogica’s chief executive.

“Our communication is very much on that sort of level of telling our consumers why we’re good at products and why we’re good at treatments … That’s the way we compete,” Lis said. “It’s an elaborate effort … [and] it’s totally different from what we would be doing in other markets.”

Bad Binch TongTong is following a similar path. Once it officially launches its store on Douyin, it will host live stream sessions from its New York office multiple times a week. The brand expects to sell tons of its $400 tank dress with the distinctively hooped hemline, since Zhou says users are already searching for the item on the platform. But it will also use live streams to gauge appetite for potential new categories like sportswear and homeware, ultimately testing its ability to become a full lifestyle brand.

“You’re not just selling products. You have to show a strong concept and then you have to consistently make content to engage with your audiences,” Zhou said. “What we are really good at is to make viral content that resonates with millions or billions of people.”

It’s the type of mentality that emerging brands looking to sell in China need to adopt to make the investment worthwhile, said Arnold Ma, chief executive of Qumin, a London-based creative agency that creates campaigns for brands selling in China.

“Forget you’re American,” Ma said. “Just focus on being a great product, a great brand, and doing great comms.”

Editor's Note: This story was amended on April 24, 2024, to reflect that the US signed into law the bill that mandates ByteDance to divest TikTok or see the app be banned in the country.