TikTok is testing a new ad format that links advertisers to its prominent influencers to let those creators display a prominent call-to-action button in their videos, according to people familiar with the matter. The ad revenue will be split between TikTok and the influencer.
The test demonstrates how TikTok, mostly considered a brand advertising platform for experimental budgets by many media buyers, is building both its performance advertising offerings and its nascent Creator Marketplace that links advertisers with vetted publishers and influencers.
This would put TikTok on the same path of other platforms, which have largely followed the same playbook in having both branding and direct-response ad products.
Still in an early testing stage, the creator call-to-action ads are only available to select advertisers and agencies. The exact revenue-share split has not been determined, although the company has been discussing a 20/80 split in TikTok’s favor, said people familiar with the program, whose tests have yet to go live. This model allows TikTok to tap into revenue that may have previously been shared only directly between the advertiser and influencer.
“We are constantly experimenting with ideas and features to improve the app experience for our users,” said a TikTok spokeswoman. “TikTok is a platform for creative expression and a big part of that is showing and sharing the things you love with others. We’re in the early stages of testing a way users can add links to products to their videos and will share more updates when we have them.”
TikTok’s Creator Marketplace launched late last year and allows advertisers to browse the platform’s top creators and filter them using metrics such as audience demographics, follower count and the topics they tend to create content about.
With its focus on creators, TikTok appears to be “pivoting more toward a YouTube creator shared revenue model than an Instagram model, which is smart,” said Amy Luca, chief executive at influencer marketing company TheAmplify. “One of the things that Instagram struggles with is retrofitting some of their programs to pull out money from the gray market ecosystem that is being earned by influencers and paid by brands on their platform.”
Earlier this month, Levi’s shared details about how it had partnered with TikTok influencers Everett Williams, Cosette Rinab, Gabby Morrison and Callen Schaub to promote its “Future Finish” customizable denim technology on the platform. The influencers’ in-feed ads included TikTok’s relatively new “Shop Now” buttons. Levi’s didn’t share specific numbers but said the push, which ended on Apr. 19, generated a watchtime that was twice as long as the average on TikTok and that product views to its “Future Finish” page “more than doubled” for the products that featured in the TikTok campaign.
The “Shop Now” button is now available to all advertisers to drive traffic to their websites — but is separate from the creator call-to-action beta test, a TikTok spokeswoman confirmed. Separately, TikTok has been allowing some of its top users to add ecommerce links to their videos and bios since November. In a similar call-to-action vein, this week TikTok also launched a product called “Donation Stickers,” made available for all users to embed within their videos and live streams to raise money for good causes.
TikTok, which had already been growing quickly over the past year, has been on a tear since the lockdown took hold. Data company Apptopia estimates the TikTok app was downloaded 100 million times worldwide between Mar. 20 through Apr. 28. Apptopia estimates 11 million of those downloads were in the U.S. TikTok was the second top free app in both the iOS and Google Play stores in the U.S. on Apr. 28, behind Zoom, according to Apptopia, which estimates TikTok has 328 million monthly active users.
“TikTok is still very much a brand [advertising] platform — it’s still nascent,” said Andrew Jude Rajanathan, a global director at media agency Zenith.
“With TikTok, the starting point is the virality of video and the creativity of the video. Over time they’ll start to add in [more] performance, direct-response [ads], the CTA buttons will get better,” Rajanathan said.
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