AI Is Fueling A $100 Billion Boom In Social Commerce

Social commerce is booming and set to hit over $100 billion in 2026. With social commerce set to account for over 8% of total e-commerce sales, some product areas, such as beauty, now account for over 50% of the global sales.

Social commerce is also democratising selling for small business owners, with low barriers to entry and little or no equipment required to start selling, other than a smartphone. Nowhere is this clearer than on TikTok Shop, the fastest-growing online retailer in 2024. According to TikTok, most TikTok Shops are small and medium-sized businesses.

However, AI automation, not influencers alone, gives small businesses the edge. AI-driven tools such as automated messaging are quietly becoming the backbone of this social commerce revolution.

This piece explores how AI and TikTok are reshaping social commerce, what that means for small businesses wanting to maximise their growth today, and why it matters now.

TikTok Shop’s unstoppable growth driving social commerce

With over 1 billion users worldwide and 15 million active sellers, TikTok Shop has quickly become a force to be reckoned with online. According to TikTok’s official figures, US TikTok Shop sales increased by 120% in the last 12 months to June 2025, and UK TikTok shop sales showed triple-digit growth.

Since the end of 2024, TikTok Shop has launched in Spain, Italy, France, Ireland, Germany, Mexico, Brazil, and most recently, Japan. The breadth of the offer has expanded, too, with 70 million products across 750 categories.

One major driver of TikTok Shop’s success is the rise of real-time interaction: LIVE selling.

Social Commerce LIVE selling is the new digital high street

Powering the growth of TikTok Shop has been the rise of LIVE streams. These allow sellers to interact with potential buyers in real time, demonstrate how their products work or look, and answer any questions on sizing, fit, and color, just like you would in a physical store with a shop assistant or owner.

One of the most compelling and engaging parts of social commerce, LIVE shopping is a fast-growing area worldwide and across platforms.

Beauty also continues to dominate in this area, with the products lending themselves to live demonstrations. TikTok’s official figures show that the UK live-stream record is held by P.Louise Cosmetics. The 12-hour LIVE marathon generated $2.2 million in sales with two products selling every second.

Live selling offers small businesses an excellent opportunity to launch directly onto social media without a traditional website.

P. Louise is the perfect example of how a small business, started by make-up artist-turned-entrepreneur Paige Williams and entirely self-funded, has leveraged the exposure generated by social selling to create one of the UK’s fastest-growing companies.

Many “born on TikTok Shop” brands that have found success on the platform also find success off the platform. Businesses in the UK, like Made By Mitchell, Glow For It, and Mallows Beauty, have attracted the attention of high-street retailers, who now stock their products on the UK high street in ‘Trending on TikTok’ aisles.

Automating the personal touch in social commerce

However, while social commerce makes selling more interactive, scale still requires tech support. That’s where AI and tools like chat marketing platform Manychat step in.

“For small brands, AI is finally closing the gap between social media engagement and real business outcomes,” states Ido Mart, chief marketing officer of Manychat, via email.

AI-powered tools like automated DM responses allow small businesses to have what Mart describes as “an authentic presence at scale.”

These tools allow small businesses to connect and interact with customers in a way that feels tailored and private to that individual customer, without the brand needing to monitor every message at every step.

“We had one creator tell us recently that using Manychat helped her secure over 65,000 leads in a year, which translated into more than $1.5 million in revenue for her business that could be directly attributed to the automations she set up with us,” Mart shares.

Without AI, small businesses would struggle to take advantage of the benefits of social selling unless they had the budget for a team to monitor responses. With AI, monitoring only the reactions that need human interaction is possible, while automating the vast majority.

Avoiding the social commerce AI pitfalls

While tools like DM automation can unlock scale and growth for small businesses, “small retailers often hesitate to adopt AI in DMs, fearing loss of control or authenticity,” according to Mart.

The solution? Don’t be afraid to start slowly and introduce just the level of automation that feels comfortable for you.

“AI doesn’t have to be all or nothing. With the right system, you set levels of automation that match the context. You can automate routine replies and stay involved where it counts,” explains Mart.

He also highlights an essential factor in automation—that it’s not just about what is said; it’s about the context and whether or not it feels relevant to the audience.

“Automation doesn’t erase your presence. The audience still hears your voice, shaped by your choices. The tone, timing, and content are still yours.” The key here is designing automation that reflects your brand to help deliver conversations that feel human “without having to be in every one.”

Same goals, new tools

Whether it’s a TikTok LIVE or an automated DM conversation, the goal for e-commerce businesses is the same as it’s always been – driving connection and conversation.

TikTok Shop, social commerce, and AI-powered automation tools are giving small businesses what they’ve lacked for some time—the potential for expanded reach and the tools to enable them to handle larger volumes of customers.

These tools allow them to unlock what Mart calls “the real benefits of AI: infinite scale, clear traceability, constant iteration, and smart segmentation.”

To compete in tomorrow’s retail landscape, small businesses must master the social commerce tools already reshaping today’s feeds.