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We’ll send you a myFT Daily Digest email rounding up the latest TikTok Inc news every morning.
TikTok is expanding its online retail offerings, with its Chinese parent company selling products through the viral video app as the group seeks to challenge rivals such as Shein and Amazon.
In recent weeks, UK users have begun to see a new shopping feature within the TikTok app called “Trendy Beat”, a section offering items that have proven popular on videos, such as tools to extract ear wax or brush off pet hair from clothing.
All the items advertised are shipped from China, sold by a company registered in Singapore that is owned by TikTok’s Beijing-based parent company ByteDance, according to filings and people familiar with the operations.
The model, similar to how Amazon makes and promotes its own range of bestselling items, represents a vast shift from TikTok’s existing shopping marketplace. It currently allows other vendors to sell items through TikTok Shop, which then takes a small commission.
By contrast, ByteDance would take all proceeds from sales made through the Trendy Beat feature on TikTok, four people familiar with its operation said.
TikTok said it was currently testing the feature. “We are always exploring new ways to enhance our community’s experience, and we are in the early stages of experimenting with new shopping features,” the company said.
ByteDance is seeking new revenues that can justify its $300bn valuation, which makes it the world’s most highly valued private start-up, ahead of an expected initial public offering in the next two years.
The effort to begin selling its own products is known internally as “Project S”, according to six people familiar with internal deliberations. They added ByteDance was building an online retailing unit to challenge groups such as fast-fashion brand Shein and Pinduoduo’s sister app Temu, a site that sells cheap products and features heavily on social media. 
Project S is led by Bob Kang, ByteDance’s ecommerce chief, who has recently travelled from Shanghai to co-ordinate the efforts at TikTok’s offices in London, according to two employees. TikTok said Kang was in the UK for a number of reasons and reports to the app’s chief executive Shou Zi Chew.
Project S utilises TikTok’s knowledge of items that are going viral on the app, allowing ByteDance to acquire or make those items itself, according to people with knowledge of the plan. The company then heavily promoted Trendy Beat products over rival sellers on TikTok, the people said.
TikTok said the brand used a network of suppliers to produce items for its Trendy Beat offering.
In order to boost its ecommerce business, ByteDance had recruited employees from Shein, two employees said.
“Bob Kang is obsessed with Temu and replicating its success, and he thinks they can do this by inserting themselves into the supply and sale process,” said another person familiar with the strategy in the UK.
ByteDance has been pushing to expand TikTok’s ecommerce offerings to replicate its success with Douyin, its Chinese sister app, which has achieved sales of more than 10bn products annually. ByteDance generated $85bn in sales in 2022, the majority of which is derived from its China business.
TikTok’s marketplace, TikTok Shop, has been successful in markets in south-east Asia, including Indonesia and Vietnam, but it is still struggling to gain traction in the UK, where it launched more than two years ago, according to multiple people familiar with the operations.
TikTok underwent a significant restructuring last month in an attempt to refocus its ecommerce efforts on its existing markets, such as the UK, instead of embarking on a broader international expansion in other western markets.
Previous attempts to ape the model of Shien and Temu have failed. Three ByteDance shopping apps — Dmonstudio, Fanno and If Yooou — have either been shut down or abandoned, two ByteDance employees said.
“ByteDance realised that they want to build a self-owned brand in the TikTok app instead of making an independent app like Shein and Temu,” one of the employees said. 
Trendy Beat’s shopping page links it to a company called Seitu, registered at an address in Singapore. Three people familiar with Project S said Seitu was owned by ByteDance, and TikTok confirmed it was a subsidiary.
According to public records, Seitu is also connected to If Yooou, a ByteDance-owned retail business. Lim Wilfred Halim, head of TikTok’s head of global ecommerce anti-fraud and security in Singapore, is registered as the director of Seitu.
Additional reporting by Mercedes Ruehl in Singapore and Eleanor Olcott in Hong Kong
International Edition

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