Tiered commissions

Unlock new ways to supercharge your creator collaborations and drive sales with new tiered commissions. This new feature lets you offer varying commission rates to creators based on how much they sell, giving you the power to finetune your payouts and ignite creator excitement.

Benefits:

• Your rules, your rates: take control! Set different commission amounts based on order volume, so you can finetune what you pay out.
• Incentivize creators with higher commissions: Get more from your creator collaborations, and reward creators differently based on their order volumes.
• Apply new commission formats where it counts: Strategically drive sales by applying tiered commissions to all or just a select few open collaboration products.

How it works:

1. Head to Affiliate Center: From your TikTok Shop Seller Center, click on "Affiliate Center."
2. Go to Open collaboration: Within the Affiliate Center, navigate to "Collaboration" and then select "Open Collaboration."
3. Select your products & edit commissions: You'll see a list of your products available for Open Collaborations. Choose the specific product you want to apply tiered commissions to and click on the "Edit" icon next to its standard commission.
4. Toggle to variable rates: On the commission editing screen, you'll find an option to select rates tied to order volume. Give that a flip! This is where you switch from a fixed commission to the dynamic world of tiered commissions. Remember, the same rate for all orders and rates tied to order volume are mutually exclusive – choosing one will automatically disable the other.
5. Set your tiers: You'll set your initial commission rate, and then define your order thresholds and the adjusted rates for each tier. For example, you might set a 10% commission for the first 100 orders, and then increase it to 15% for orders beyond that. Remember, currently only two tiers are available, and once your tiered commission is active, order thresholds cannot be changed and commission rates can only be increased.
6. Confirm and Launch! Once you're happy with your tiered commission setup, confirm your changes. Behind the scenes, TikTok Shop will apply these new rules to your chosen products within Open collaborations. Creators who are part of or join your Open Collaborations will now see the commission range for your product, letting them know the potential for bigger payouts.

What to know about your tiered commission structure:

• Once a tiered commission is active, you must wait 30 days before switching back to a fixed commission. After 30 days, you may:
  • Stay on the current tiered commission (same thresholds, same commission model, rates can be increased), or
  • Switch to a fixed commission (your old tiered settings will no longer apply).

• If you later switch back from a fixed commission to a tiered commission, you’ll create a new tiered setup—free to set new thresholds, commission rates, and choose your model.

• Fixed → Tiered:
  • If the pre-threshold tiered rate ≥ current fixed rate → tiered commission applies immediately.
  • If pre-threshold tiered rate < fixed rate → fixed rate locks for 30 days; tiered applies afterward.
• Tiered → Fixed:
  • After 30 days, sellers can switch to fixed; new fixed rate applies immediately.

• Order counts for creators start once the tiered commission becomes active.

• Thresholds are fixed: Once you set the order threshold (e.g., first 100 orders), it cannot be changed.
• Commission model is locked: A Low-to-High model (e.g., 10% for the first 100 orders, 15% after 100) cannot be changed to High-to-Low, 13%/10%. A High-to-Low model (e.g., 12% for the first 100 orders, 6% after 100) cannot be changed to Low-to-High, 12%/15%.
• Commission rates can only be increased. Once set, they can not be lowered. Example: A 10% commission for the first 100 orders and 15% after 100 cannot be reduced to 10%/12% or 8%/15%.
• 30-day lock period:
• New setup after switching:
• When commissions take effect during model switches:
• Order quantity tracking:

Tips:

• Start with a clear strategy: Think about your product's performance and your sales goals before setting your tiers. What order volumes would you love to see? How can you incentivize creators to hit those numbers?
• Communicate with your creators: While they'll see the commission range, consider reaching out to your top-performing creators to let them know about this exciting new opportunity to earn more and the exact milestones they need to hit!
• Review and adjust: Keep an eye on your sales data and creator engagement. If a tier isn't performing as expected, remember you can increase your commission rates to make them more appealing.
• Embrace the data: Use the insights from your tiered commission performance to inform future product launches and collaboration strategies.

FAQ:

• Can I set up tiered commissions for individual products or in bulk?

Yes, you can set up tiered commissions at an individual product level or in bulk for selected products.

• Can I change my tiered commission rates or thresholds later?

Please see above for details on how tiered commission set-up works.

• How do creators know about the tiered commissions?

Creators will see that there is a commission range for your product, indicating that higher sales can lead to bigger payouts. You can also share the specific milestone they need to hit in order to increase their commission by sending the creator an IM.

• Is there a time limit or momentum requirement for a creator to maintain a higher commission once reached?

No, once a creator achieves a higher commission tier for a specific product, they will maintain that rate for all subsequent qualified sales of that product. There's no "drop back down" based on a lack of continued sales after reaching a tier.

• Is the "Est. Standard commission payment" the final commission I need to pay to the creators?

No, the "Est. Standard commission payment" is the estimated creator commission before order settlement. The actual commission may change if there are returns or refunds. Additionally, if the product offers tiered commissions, before the threshold is reached, the platform will display the "Est. Standard commission payment" at the higher commission rate, but this will not affect the final creator commission.

• Does tiered commission affect order settlement rules?

Yes, before the threshold is reached, when an order is created, the platform withholds the creator commission at a higher rate. When order settlement, the platform calculates the commission using the actual applicable rate and refunds the over-withheld amount.