YouTube is bringing shopping features to its new short-form video service, as the streamer attempts to claw back lost advertising revenue.

During the third quarter, YouTube advertising revenue dropped two per cent year over year to A$10.5 billion.

It marked the first quarter in which YouTube’s ad revenue shrank on a year-over-year basis since Alphabet started breaking out the division’s results in 2019.

The move to compete with TikTok in the short form space is largely seen as a way to fortify against further advertising losses.

A new feature, announced overnight, allows eligible creators to tag products from their own stores.

It is currently available in the United States only, however a Google spokesperson confirms that “viewers in the U.S., India, Brazil, Canada, and Australia can see the tags and interact with them and we’ll continue to bring tagging to more creators and geographies.”

YouTube is also testing a commission-based scheme for influencers selling products through video links.

This comes as TikTok’s in-app shopping feature begins to roll out in the US market, after first testing in the UK, Indonesia, and Southeast Asia.