- TikTok Shop, the e-commerce arm of TikTok, launched in Mexico in February.
- It offers sellers a bridge into Latin America, a fast-growing region for online shopping.
- Its arrival in the country offers a way for US Shop sellers to hedge against a possible TikTok ban.
TikTok’s future may be up in the air in the US, but it’s ramping up in other parts of the world.
The company officially launched its e-commerce product, Shop, in Mexico in February after testing it in the country. The platform is still getting off the ground there, but it’s attracting local sellers like beauty brands Sarelly, Renova, Pink Up Cosmetics, and Sinless Beauty.
The move across the border is also opening an opportunity for US brands to expand into a fast-growing market — and hedge against a possible TikTok ban.
Beauty brand KimChi Chic Beauty, supplement brand Beast Bites, and security-camera brand Wyze are among the US companies planning to expand into Mexico, per two Shop agencies that work with the firms.
“It’s a logical play for any seller that saw success or could see success on TikTok Shop,” said William August, CEO of the social-commerce agency Outlandish, which runs a livestream facility in Los Angeles and recently set up operations in Mexico. “Regardless of what happens in the US, they should be doing it anyway.”
TikTok Shop has grown quickly in the US since it first began testing the feature there in 2022. But the app is operating on shaky ground due to a divestment law that requires its Chinese owner, ByteDance, to sell the app or essentially stop operating in the US. While that hasn’t deterred many brands that sell goods on TikTok in the US, some are busy diversifying onto other platforms like live-selling app Whatnot or entertainment platforms like Flip and LTK. Moving into other TikTok Shop markets, like the UK, Singapore, and now Mexico, is another tactic.
How a US brand can expand into Mexico
In some instances, Outlandish is helping US merchants launch in other countries by registering a local business on their behalf, called a merchant of record.
The company also acts as a one-stop shop for other services, like logistics and compliance.
Outlandish set up a joint venture with marketing and retail media firm MindgruveMacarta to help bring US and global brands onto TikTok Shop. In February, Outlandish sent its US livestream training managers to Mexico to teach local staff about selling live, August said. It plans to open a video production hub in the country with the capacity to produce thousands of shopping videos.
“So long as you have a good product, when you enter a new market with TikTok Shop, you can grow a brand there,” August said.
Social-commerce agency Orca is also working with third-party logistics providers in Mexico to help US brands start selling in the country, offering services like inventory management and compliance, said its CEO Max Benator. “If you’re a brand in the US, you can’t just turn on in Mexico,” he said.
Shop’s entry into a neighboring country allows US sellers to do more than lower their risk from a US ban. It gives them access to an e-commerce market that’s on the rise. In September, EMARKETER forecast that e-commerce spending in Latin America would reach close to $180 billion in 2024.
Mexico, in particular, is expected to drive a lot of that growth. In 2024, EMARKETER forecast Mexico would be the fifth-fastest growing e-commerce market in the world, growing online sales by 15.7%.Major retailers like Amazon, Walmart, and Mercado Libre are investing billions of dollars to improve their operations in Mexico and reach a nascent customer base there, according to the firm.
“Mexico and Latin America are some of the fastest growing e-commerce markets in the world,” Benator said.
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