- Smart Promotion replaced co-funded promotions for most US merchants on March 3, 2026.
- It charges 3.5% of total store GMV, rising to 4.5% during major campaigns like Black Friday.
- There is no budget cap. You can opt out, but opt-out is assessed at month end.
- Product exclusions go through your account manager, and excluded products leave the fee base.
- Model it per SKU before every campaign.
On March 3, 2026, TikTok Shop moved most US merchants from co-funded promotions to Smart Promotion. For many brands it is now the most expensive line on the settlement statement. Source: PPC Land. Platform rules change often, so confirm the current version in Seller Center before you act on any number here.
How Smart Promotion works
- It charges 3.5% of total store GMV, rising to 4.5% during major campaigns such as April Stock Up, Memorial Day and Black Friday. The fee applies to every order, not only discounted ones.
- Since April 2026, enrolment is required for platform campaigns, Flash Sales and Weekly Promos, and since June 2026 for brand campaigns.
- Eligibility needs a Shop Performance Score of 3.5 or higher (for shops with 30+ orders in 90 days) and an Account Health Rating above 150.
- There is no budget cap.
- You can opt out, but status is checked on the last day of the month.
- Products can be excluded only through your account manager, and since June 2026 excluded products are also removed from the fee base.
Why it matters
A fee on total GMV hits your lowest-margin products hardest. On a $20 product with a thin margin, an extra 3.5 to 4.5 points can be the difference between profit and loss, before creator commission and ads.
How to protect your margin
- Find out whether Smart Promotion is on for your shop today.
- Model contribution margin per SKU with the fee included, at campaign and non-campaign rates.
- Ask your account manager to exclude products that cannot carry the fee.
- Compare the extra traffic against the extra cost over a full month, not one campaign weekend.
- Re-price or bundle low-margin SKUs so they survive the fee.
The TikTok Shop profit checklist covers this and 19 other margin checks. If you want us to run the numbers on your shop, book a free profit check.
Want to know how this affects your shop specifically?
Get a free profit checkFrequently asked questions
What is Smart Promotion on TikTok Shop?+
A platform-run promotion programme that replaced co-funded promotions in March 2026. TikTok applies discounts and charges sellers a percentage of total store GMV.
Can I turn off Smart Promotion?+
Yes, you can opt out and back in. Opt-out status is assessed on the last day of the month, and leaving mid-month can forfeit that month's discount support. Individual product exclusions go through your account manager.
How much does Smart Promotion cost?+
3.5% of total store GMV outside campaigns and 4.5% during major campaigns, charged on every order whether or not a discount was used.
