TikTok wants more ad dollars, and has a new plan to get them
“It’s old technology in a new medium, and it will be interesting for traditional agencies around the world to embrace it,” he said.
TikTok has been popular in the United States for less than five years, but it has spawned a cultural economy that includes coalitions of influencers, dedicated platform-only marketing agencies, and, the company said this week, over ‘one billion monthly users around the world.
Business and Economy
Without the app, musician Lil Nas X probably wouldn’t be a Grammy winner climbing the steps of the Met Gala in gold armor. Leggings wouldn’t fly off the shelves, and trend-watchers wouldn’t have a hard time decoding what the “cheugy” aesthetic really means.
This year, the share of people who were exposed to ads on TikTok nearly doubled to 37% from 19% last year, according to research firm Kantar, which surveyed more than 14,500 people in 23 regions. . The platform was considered to have the most entertaining ads, but more and more people complained about encountering too many of them on the app.
“We don’t want to interrupt the experience,” said Blake Chandlee, president of global business solutions at TikTok. “We want people to look at an ad and say ‘It was amazing’, not ‘I watched this because it was in my feed.'”
When Mr. Chandlee joined TikTok in 2019 after more than a decade at Facebook, the app only had a few dozen advertisers. Halfway through the pandemic, TikTok has become a serious competitor to television and other platforms, he said. Now he has hundreds of thousands of advertisers, he said.
Advertising is responsible for TikTok’s “lion’s share” of revenue, Chandlee said, adding that the company is also testing subscriptions and tips. And yet, TikTok generates less than $ 1.3 billion in annual ad sales in the United States, compared to $ 2.2 billion for Twitter, $ 2.6 billion for LinkedIn and $ 48 billion for Facebook and Instagram, according to the research firm eMarketer.