Selling online is an increasingly accessible opportunity, but choosing the right platform can make the difference between success and failure.
Amazon and TikTok Shop are two marketplaces with very different business models, each with advantages and disadvantages in terms of costs, visibility and marketing strategy.
Amazon is synonymous with reliability and high sales volume, but with high commissions, growing advertising costs and considerable logistics expenses.
TikTok Shop, on the other hand, allows sellers to exploit the power of viral marketing and affiliates, with lower initial costs, but a strong investment in collaborations with influencers.
Below, we analyze the main cost differences, providing a clear picture for those who are evaluating which platform to sell on.
Detailed analysis of cost differences
Referral Fees: Amazon is More Expensive
- Amazon charges a sales commission of between 6% and 45%, depending on the category. The average for most products is around 15%. For example, a $20 toy will pay about $3 in commission.
- TikTok Shop, on the other hand, has lower commissions (5% – 8%), which for the same toy would translate to $1.20 commission.
Conclusion: Amazon has more complex and often unpredictable ancillary costs, while TikTok Shop is more transparent.
2. Monthly Subscription: TikTok Shop is free
- On Amazon, sellers must pay a monthly subscription of $39.99 to access the Professional Plan. This cost is fixed, regardless of the number of sales made.
- TikTok Shop does not require any subscription cost, allowing new sellers to test the platform without initial investment.
Conclusion: TikTok Shop offers a cheaper and less risky access for those who are starting out.
3. Logistics: TikTok Shop has lower costs in countries where there is Fulfilment by Tik Tok
- Amazon FBA (Fulfillment by Amazon) has variable costs based on weight and dimensions. For example, for a lightweight toy, the logistics cost is around $3.50 per unit.
- TikTok Shop, on the other hand, uses a percentage logistics fee, typically between 1.8% and 2.8% of the selling price. For a $20 toy, the cost would be only $0.36.
Conclusion: TikTok Shop has lower shipping and handling costs, especially for lightweight and low-cost products.
4️. Advertising costs: Amazon is more expensive
- Amazon uses PPC (Pay-Per-Click) for advertising. The cost of campaigns depends on the competition on keywords and is often very high, absorbing up to 30% of sales.
- TikTok Shop is based on two models:
– GMV Max Ads, an advertising system still in development.
– Affiliate and influencer marketing, who receive a commission on the sales generated.
Many sellers report a 2x-3x ROI on TikTok Shop, versus a lower return on Amazon due to the saturation of the market.
Conclusion: TikTok Shop offers a cheaper alternative to Amazon PPC advertising, but it requires investing in affiliate partnerships.
5️. Other costs: Amazon has more hidden costs
- Amazon includes numerous additional costs, such as:
– Storage costs for unsold products.
– Costs of returning and removing unsold items.
– Long-term storage, which increases over time. - TikTok Shop, on the other hand, is simpler and only charges a 20% referral fee on returns and a discretionary commission for Tik Toker Affiliates (10-20%).
Conclusion: Amazon has more complex and often unpredictable ancillary costs, while TikTok Shop is more transparent.
Amazon vs TikTok Shop: Which is better?
Conclusion: Amazon or Tiktok Shop?
- TikTok Shop is more convenient for those looking for low costs and viral marketing, but it requires commitment active with affiliates and influencers to gain visibility.
- Amazon is ideal for established sellers looking for a scalable platform, but commissions, the advertising and logistics can erode profits.
TikTok Shop is perfect for testing new products and selling to a young audience.
Amazon is better for those who want to build a solid and lasting business in the long term.
