The news: Square partnered with TikTok to let its merchants promote and sell through the short-form video app, which recently hit 1 billion monthly active users, per a press release.
Why it’s worth watching: Social commerce is booming, and growth won’t slow down anytime soon—US retail social commerce sales are expected to grow 35.8% year over year (YoY) in 2021, hitting $36.62 billion, per our forecasts. Sales are expected to top $45 billion next year.
TikTok is quickly becoming one of the top selling destinations thanks in part to its large base of users, many of whom are Gen Zers and millennials: 48% of US TikTok users are between 18 and 29 years old, per Pew Research Center. And Gen Z and millennials possess nearly $3 trillion in spending power, according to YPulse—so retailers and ecommerce providers are running to take advantage of their revenue-generating opportunity.
Social commerce is booming beyond TikTok as well—Square’s rival PayPal recently forged a partnership with “link in bio” social media service Linktree to let creators take direct payments on Linktree globally.
The opportunity: TikTok opens the door for Square to sustain the dramatic growth it reported last quarter.
Related Content: Check out our “Social Commerce Forecasts 2021” report for a look at the industry’s history, opportunities, and challenges—and where it might be headed next.