Even though social shopping is a multibillion-dollar business in China, it hasn’t quite caught on in the West. Companies like TikTok and Meta have attempted to implement ecommerce features across their respective platforms, but those efforts have struggled to find users.
Now, Klarna is taking social shopping for a spin. The Swedish fintech company, known for its platform that delivers deals to cost-conscious consumers, is bringing a TikTok-style feed and AI-generated recommendations to its app.
According to TechCrunch, the new version of Klarna will initially roll out in regions like the United States, United Kingdom, and Germany. Users will be able to “Ask Klarna” if they want to be connected with the company’s stable of fashion experts. They’ll also be able to browse offers through an interface inspired by TikTok’s For You Page.
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Klarna CMO David Sandstrom told CNBC that Klarna’s redesigned app was inspired by Chinese social shopping services. “In China, a couple of years ago, 90% of transactions started with a search,” Sandstrom said. “Nowadays, less than 50% of purchases start with a search because recommendations are so tailored to them.”
Beyond its reliance on algorithmic recommendations, Klarna is also taking another page out of TikTok’s book: It’s courting creators. Its “Creator Shop” will allow influencers to set up their own storefronts, where they can benefit from affiliate marketing deals. That feature is set to hit the U.S. “soon,” according to CNBC.
Klarna has boosted its own brand through partnerships with creators. Multi-hyphenate Bretman Rock appeared alongside Paris Hilton in one of the fintech firm’s recent campaigns.
Klarna is not alone in its chase for social shopping dollars. Big companies like Twitter, Amazon, YouTube, and Hearst have attempted similar initiatives.
It’s not hard to see why so many companies are big on app-based ecommerce. The size of that market in China has been a boon for companies like ByteDance and Xiaohongshu, which have been able to turn profits from domestic sales even as their apps face scrutiny abroad. But as of yet, Western consumers haven’t indicated that they have a huge appetite for social shopping.
Klarna is hoping to change that. Sandstrom told CNBC that his company plans to be profitable on a month-to-month basis by the summer.
