Is TikTok Shop Slowing Down the App’s Growth?

• TikTok’s growth slowed in 2023 as TikTok Shop expanded, frustrating some users.
• Monthly active user growth dropped from 12% to 3% year-over-year.
• Rival Instagram removed its Shop tab as social commerce has struggled.

TikTok’s growth slowdown

TikTok was the top app worldwide last year for downloads and consumer spending, but new data indicates the platform’s meteoric growth is slowing down.

This deceleration coincides with TikTok’s continued expansion into e-commerce through its TikTok Shop platform.

According to market intelligence firm Sensor Tower, TikTok’s monthly active user growth averaged 12% year-over-year per quarter in 2022.

However, this dropped to only 3% year-over-year growth in 2023 as TikTok Shop rolled out more broadly in Western markets.

TikTok Shop impact

Launched in late 2022 in the U.S., TikTok Shop aims to translate the app’s influential videos into sales. However, the influx of creators and brands promoting products has frustrated some users.

Complaints have emerged on Reddit and beyond that the app is now overrun with “ads” and people “dropshipping cheap products.”

Challenges for TikTok Shop

While TikTok Shop has quickly grown to 6 million monthly active sellers, it still only reaches a fraction of TikTok’s 1.4 billion global user base.

And the app’s stagnating download figures suggest not all users are happy with the increased commercialization.

Rival Instagram actually removed its Shop tab in early 2022 as social commerce struggled to gain major traction. And Instagram’s growth does not seem to have been significantly impacted by TikTok Shop so far.

Still, if user disenchantment with in-app shopping continues to grow, TikTok may need to refine its e-commerce strategy to keep its community happy.