YouTube Shorts begins testing shopping features and affiliate marketing

YouTube is adding shopping features to Shorts, its TikTok-like short-form video product, the company confirmed to TechCrunch on Tuesday. The new shopping features allow users to purchase products as they scroll through Shorts. The news was first reported by the Financial Times.

The company is starting to introduce shopping features on YouTube Shorts with eligible creators in the United States who are currently piloting the ability to tag products from their own stores. Viewers in the United States, India, Brazil, Canada and Australia can see the tags and shop through the Shorts. YouTube says it plans to continue bringing tagging to more creators and countries in the future.

In addition to the shopping features, YouTube is experimenting with an affiliate program in the United States that allows creators to earn commissions through purchases of recommended products in their Shorts and regular videos. The company says the test is still in its early days and that it plans to gradually expand the experiment to more creators next year.

"We firmly believe YouTube is the best place for creators to build a business and shopping is a piece of that," a spokesperson for YouTube told TechCrunch in an email.

The news comes a few weeks after YouTube announced that creators will take a 45% share of ad revenue starting next year. In early 2023, creators will be able to apply to the company's Partner Program if they meet a new Shorts-specific threshold of 1,000 subscribers and 10 million Shorts views over 90 days, after which they will earn 45% of ad revenue from their videos.

YouTube’s Shorts has topped 1.5 billion monthly users, but despite this success, YouTube’s quarterly ad revenue declined 1.9% year over year and missed expectations, per Alphabet’s quarterly earnings report released last month. YouTube likely sees the new shopping features as a way for it to broaden its revenue streams amid a slumping advertising market.

Over the past few years, YouTube has been working to transform its platform into more of a shopping destination with product launches like shoppable ads and the ability to shop directly from livestreams hosted by creators. Given these moves, it makes sense for YouTube to bring shopping to Shorts too.

YouTube isn't the only digital giant to bet on the future of shopping, as TikTok and Meta have also invested in the space.

Last week, TikTok quietly began testing TikTok Shop in the United States. TikTok Shop allows users to buy products directly through the app. Prior to this expansion, the feature was only available in the United Kingdom and parts of Southeast Asia. Earlier this year, the company also began piloting TikTok Shopping in the United States, United Kingdom and Canada in partnership with Shopify.

Meta-owned Instagram allows creators to share products in livestreams and in its shopping tab, which lets users scroll through recommended products and make purchases. Brands are also able to make their profiles shoppable through product catalogs.