Thankfully, PayPal and Stripe are considered relatively safe; they both use encryption to guard my financial data. TikTok also claims it doesn’t store my personal information after I buy an item.
Even so, Don Grant, a certified financial planner, says to proceed with caution.
“Those who post on TikTok want something from you,” he points out. “The TikTok platform wants something from you. If that ‘something’ is of value, viewers may only know it once it’s missing.”
Here’s the rub: TikTok takes a cut of shop sales from merchants, so it has a vested interest in getting me to shop — and splurge — in the app. The company has big plans for expansion, too. The Wall Street Journal reported last month that the social platform is gearing up to launch a marketplace called the TikTok Shop Shopping Center. The Atlantic wrote that “TikTok’s turn to e-commerce, in theory, has the potential to be massive, capable of competing with the likes of Amazon.”
The TikTok Shop interface is so smooth that "you can basically click on something and buy it in a matter of seconds," shopping expert Trae Bodge tells me. It reduces the pain of paying, a behavioral economics concept that refers to the unpleasant feelings a person gets when they spend money. (Remember Issue #143, when we talked about how transacting in cash affects you psychologically?)
That "pain" is important because it regulates people’s desire to buy stuff. When it goes away — say, because I’ve seen 50 increasingly convincing bra videos and the button to buy one is right there — so is that self-regulation.
“Because of the ease of shopping, people don’t take the time to read reviews or look for ways to save more,” Bodge says. “That ease is a gateway for potential overspending, or less informed spending, on the general internet.”
She recommends slowing down and pausing whenever possible. Sure, TikTok Shop might be convenient, but it means I might miss out on discounts and coupons offered by other vendors elsewhere online. I just need to take the time to do some research.
Before mindlessly throwing things into my cart on TikTok Shop, Grant suggests I ask myself two crucial questions: 1) “Do I really need this?” and 2) “Is there another platform that I trust from which I can purchase the same product or service?” The answers will guide me.
