Briefing: Douyin’s lack of oversight may hinder e-commerce ambitions

1 min read

烤虾大妈:对抖音三无产品不知情,被人盗用了视频 – Jiemian

What happened: In a blog article published Thursday which quickly went viral on Chinese social media, a woman who said she worked for a Fortune Global 500-listed food company wrote about being cheated into buying what she thought was high-quality dried shrimp at a premium price after viewing a short video on Bytedance-owned Douyin. In the video, a short video key opinion leader (KOL) known as Sansao was promoting the shrimp product, saying that it was made by her own family. Sansao has a following of more than 700,000 on rival short video platform Kuaishou. On her Thursday livestream on the Kuaishou platform, Sansao said that her video was stolen by others to sell counterfeit products on Douyin, the Chinese version of TikTok. Douyin responded on Friday that it closed the account which stole the video.

Why it’s important: Douyin has attracted a massive user base in the past two years, with 500 million monthly active users (MAU) as of December 2018, according to a recent report. The next stage of its development is to successfully monetize its massive user base. It began testing e-commerce at the beginning of 2018, then launched a selling platform in the app for KOLs to hawk their products in May of that year. According to an estimate by Evergrande Research Institute, Douyin’s advertising revenue in 2018 exceeded RMB 18 billion (around $2.6 billion). However, the platform lacks a policy framework to protect consumers. For example, there is no way to complain about poor quality or service, or to return purchases on Douyin. You Yunting of Shanghai-based DeBund Law Offices told Jiemian that Douyin is responsible for ensuring that sellers conducting business on its platform are licensed, and that the absence of supervision and punishment was creating a poor environment for consumers.