Inside TikTok and Amazon’s symbiotic advertising relationship

Viral TikTok videos may inspire people to “buy it,” and Amazon is positioning itself to be the place people shop for items they spot on social media. The social shopping dynamic has led Amazon to pour more advertising dollars into TikTok, according to recent data from Sensor Tower, an ad analytics company.

And the relationship is mutual. TikTok has taken the rare move of looking for a “head of Amazon,” who can help develop that relationship and secure more Amazon ad revenue. 

In the first half of the year, Amazon’s U.S. ad spend increased 30% on TikTok, according to Sensor Tower, which can track trends in digital ad spend on social media platforms. Sensor Tower does not see the full scope of ad revenue on any given platform, but it can offer directional guidance into how brands are spending their marketing dollars. For Amazon, it is clear that TikTok has become a core part of its strategy as viral shopping is becoming a more important driver of e-commerce.

“For Amazon and creators and TikTok, it’s a symbiotic relationship,” said Alexis DeBrunner, associate strategy director, R/GA. “‘TikTok Made Me Buy It’ is a major trend, and it’s the way people discover products.”

“TikTok Made Me Buy It” is one of TikTok’s biggest trends, alongside “CleanTok” and “BookTok,” all of which are categories of videos that have shopper tie-ins, encouraging people to seek out the featured products. “Amazon Finds” is nearly just as popular, generating 60.4 billion views, in line with “TikTok Made Me Buy It.” There are TikTok creators who are pointing viewers to storefronts on Amazon where they can buy the fashion hauls, cleaning products, gadgets and more that they feature.

Look back: Amazon makes push for BookTokers

The TikTok and Amazon shopping connection has not gone unnoticed by TikTok higher-ups as the platform develops its own shopping platform. TikTok has been looking for a “head of Amazon” to oversee the e-commerce giant’s ad strategy on the platform. “The Head of Amazon will anticipate the business needs of numerous verticals and deliver measurable solutions for many diverse lines of businesses and clients,” according to the TikTok job description. This senior-level position will “develop and maintain C-level relationships across multiple lines of Amazon businesses to expand TikTok's penetration, status, and educate and inform on the power of TikTok's platform.”

Amazon and TikTok declined to comment for this story.

Social search and shopping

The budding relationship between the two companies is one of rivals, but they also must lean on each other for various parts of their strategies. TikTok, the social video app owned by Chinese-based ByteDance, is a force for creators and entertainment, but it has ambitions in e-commerce. Meanwhile, Amazon is an e-commerce giant with ambitions in the creator space. 

TikTok also recently opened up search ads to all advertisers. Search advertising is enabled by flipping a toggle in TikTok's ad platform that delivers promoted results inside search queries. Search is a format that could facilitate direct links to products and shopping outcomes, giving TikTok a clearer path to attribute when it led to sales results.

TikTok Shop, which is supposed to be a social media-based rival to Amazon, launched in 2022 but it has reportedly gotten off to a rocky start. U.S. TikTok users see a Shop feed in the app, which points people to products available to purchase right on TikTok, rather than having to click a link to an outside retailer. The Shop feed, however, sometimes features low-quality products, according to a recent Bloomberg report, which also claimed that TikTok wants Shop to rival Amazon for a $20 billion merchandising market.

Social shopping has failed to catch on in the U.S., at least when compared to other parts of the world, particularly Asia, where consumers are used to buying through popular social media apps such as Douyin, TikTok’s sister app from ByteDance in China. Meanwhile, Amazon is having growing pains in social media, with a product called Amazon Inspire, which launched last year. Inspire is a TikTok-style video feed in the Amazon app that has shopping hooks. Amazon was offering paltry wages, $25 a video, to populate Inspire, which prompted snickers from creators, according to Bloomberg.

For now, it seems like the two companies still need each other, or at least need to learn from each other. Creators are active on TikTok, promoting their Amazon storefronts to draw shoppers, and TikTok could use Amazon to get a better handle on U.S. consumers.

“TikTok is getting all the views and not getting as big of the purchasing credit,” R/GA’s DeBrunner said.

Amazon ups its spending on TikTok

As TikTok develops its e-commerce strategy it also has to be careful to work more closely with advertisers such as Amazon, so as not to make changes that could sour their relationships, according to Rachel Tipograph, CEO of MikMak, an e-commerce platform for brands, which helps retailers analyze sales through links across social media sites.

“TikTok needs product innovation and a product strategy,” Tipograph said, “and when you’re a major ad spender [like Amazon], you will have advice to help shape that product roadmap. And it seems like Amazon is a large advertiser on [TikTok], and the person leading the Amazon account for TikTok not only has commercial responsibilities but has to make sure Amazon is represented at the table.”

TikTok is trying to balance how much it pushes sales directly inside the app and how much it allows links to send shoppers to websites where it’s harder to take credit for the sales.

“I think they’re probably trying to figure out ways to not cut off advertiser and partners at the knees, by not cutting off links,” DeBrunner said, “but also find ways to direct consumer through their own revenue channels.”

As TikTok figures out its e-commerce strategy, Amazon continues to see it as a lucrative path to winning shoppers.

Amazon has increased advertising on TikTok, according to Sensor Tower, to promote products such as Prime Video, its streaming service and Shop Amazon, which is its e-commerce arm. Amazon’s U.S. TikTok ad spend rose 30% in the first half of 2023 compared to the first half of 2022, according to Sensor Tower. Meanwhile, Amazon’s U.S. ad spend declined 25% on other social media channels that Sensor Tower measured for this story.

In all, Amazon, including brands such as Zappos, Audible, Whole Foods and MGM, spent $3 billion across all measured media in the U.S., according to data from Vivvix, up from $2.9 billion in 2022. TikTok accounted for 8% of Amazon’s U.S. ad spend in the first half of 2023, up from 5% in the first half of 2022, according to Sensor Tower’s analysis.