What is TikTok?
TikTok is a video-sharing social network that allows its users to create, share, and discover short videos. It is often referred to as a “lip-syncing” app, but as it evolves, it is now more known for its act-out memes backed with music and other sound clips.
The platform allows users to create and consume fun and engaging video content through its various video editing features — making it easy for everyone to participate. It’s no wonder that consumers are now creating new and innovative content more frequently on TikTok. Brands, on the other hand, are jumping on the bandwagon to reach a large community of users who have a liking for entertainment.
Who uses TikTok?
The audience on TikTok is generally a lot younger compared to other social media platforms with 41% of them aged between 16 and 24. So for brands that cater to younger audience, TikTok is the place to be. Furthermore, with people spending almost 52 minutes a day on the app, brands have a better chance of getting noticed. To compare, U.S. Android users spend 53 minutes on Instagram, 58 minutes on Facebook, and 49,5 minutes on Snapchat.
Even though the app is still more popular among teens, the older population on TikTok is also growing rapidly. In less than 18 months, the number of US adult TikTok users grew 5.5 times. Therefore, content should appeal to both young and adult audiences alike.
Like all other social media platforms, TikTok has a very global outlook with 39 different languages. It has become very popular in Asian countries especially China with 600 million active users and 200 million active users in India in 2022. Besides these two countries, it is popular in smaller countries including Cambodia, Indonesia, Japan, Malaysia, Thailand, and Vietnam.
How do ads work on TikTok?
One of the most important factors when advertising on TikTok is to create engaging ads and continuously optimise them to avoid creative fatigue due to how the content is consumed on the platform. This helps to keep the CPM as low as possible.
However, TikTok has been ahead of the curve by offering a Video Creation Kit that allows users to easily create engaging videos with a variety of video templates. This saves money on professional video editing as the process is much simpler and streamlined.
TikTok has also found a way to make it a lot easier video creators to make appealing content. They have created a system called the Automated Creative Optimisation that finds high-performing combinations of the inputs provided. For example, a user can upload a few videos or images, write a couple of ad copies and choose a CTA (Call to Action). TikTok will then automatically create a few different ad variations.
However, to avoid ad fatigue and decreased ad engagement, marketers are advised to refresh their ad assets regularly to ensure fresh creatives.
How does TikTok rank my ads?
Every ad platform employs an algorithm to determine what ad gets shown to each specific user. TikTok is of course no different.
To determine ad deliverability TikTok uses a metric called Ad Rank. This is a combination of the click-through rate, the conversion rate, and the bid price. So, to put it in another way, TikTok looks at the quality of the ads and the likelihood of people interacting with the ad (ad relevance) in combination with how much the advertiser is willing to pay.
However, compared to other advertising platforms TikTok also includes other parameters such as engagement rate and watch time. In the end, an ad that keeps the consumer engaged and allows them to stay on the app will most likely get prioritised.
TikTok Ad Cost
One of the cons of advertising with TikTok is the relatively high budget you need to allocate before being able to advertise on the platform. While bigger brands may not find this a problem, it can be a high barrier of entry for smaller businesses to use this app as an advertising platform.
For the ad group level, the total minimum budget is $50 while the daily minimum budget has to exceed $20 per ad set. There is little room to optimise without having a big budget. Therefore if a marketer spends $50 a day to test the platform, that would mean they could only create 2 ad sets, targeting 2 different audiences.
What can we gain from TikTok ads?
In general, advertising on TikTok is a lot cheaper compared to other platforms. With a CPM (cost-per-thousand-impressions) of almost $1, it is a lot lower than Facebook that has an average CPM of almost