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TikTok touts its curated audiences to advertisers to drive Black Friday, Cyber Monday sales

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Black Friday signals the start of the holiday ad frenzy, and TikTok wants to get a hefty chunk of ad dollars this year, according to materials the short-form video app sent to prospective advertisers that were reviewed by Digiday.

TikTok’s plan centers around custom audience packages — dubbed “Hashtag Audiences” — or bundles of people who are most likely to buy that brand’s product. They’re curated for advertisers by TikTok based on a number of signals, including whether they’ve already shown interest in the brand, industry or similar product, according to an email sent to a U.S. advertising agency last month.

With this program, TikTok is targeting marketers who can move quickly: the deadline to create a campaign is Oct. 25. Advertisers will have to spend at least $1,000 per day on incremental spend toward the custom audiences for at least a week long period in the fourth quarter, leading up to and, or after Black Friday and Cyber Monday, according to the email.

The problem, as ever with less established platforms, is the price, if you take them up on their recommended investment costs. TikTok didn’t immediately return a request for comment on this story.

TikTok is recommending that advertisers spend a minimum of $250,000 during the Black Friday and Cyber Monday period across all placements, which includes Top Feed, TopView, Brand + Performance Auction In-Feed Video).

Sources who spoke to Digiday varied on whether this pricing was obtainable.

Amy Rumpler, svp search and social media services at Basis Technologies said she thinks the pricing is reasonable, and not outside the range of what other platforms look for during key seasonal moments or when debuting new product features.

“The price point helps ensure the right level of advertisers, and the right number of advertisers, can take advantage,” Rumpler explained. “If it works and response is good (and this follows suit with other similar incentive-type programs), next year, it will be available at a much lower entry point (or, even available to all as a GA release — who knows.)”

Shray Joshi, founder and CEO of Good Peeps, which has clients including protein snack brand Chomps, and Chinese chilli hot sauce Fly By Jing, has 70% of clients on TikTok, of which 15% advertise on the platform. Joshi shares a similar view about the pricing. He said he thinks that the $250,000 spend is most likely for brands spending about $1 to $2 million a month in total advertising.

“That means they [TikTok execs] are trying to target brands that are likely doing at least $30 to $50 million in revenue with this offer,” Joshi explained. “It looks like they [TikTok] are trying to attract more of the mid-market and upper-market brands with their ad product incentives while TikTok Shop seems to be more focused on SMBs.”

This is not an entirely unique prospect platforms offering up custom audience options, as Meta automatically does, said Haley Feazell, group media director at digital agency Mindgruve, who reviewed TikTok’s pitch.

“I don’t feel like it should be an extra benefit [on TikTok],” she said. “It should be part of the algorithm already if we’re going to bank on it working for us.” 

If TikTok’s program sounds like déjà vu, that’s because the platform had a similar pitch last year — though specifics about last year’s program aren’t clear. The 2023 email seen by Digiday, revealed that advertisers who employed hashtag audiences during the 2022 holiday season experienced an average 36% drop in Cost Per Acquisition (CPA) compared to their other campaigns.

“it’s a very interesting signal toward what level of enhanced targeting might be available to more advertisers in the future — especially as TikTok’s data set (and specifically data tied to purchases and purchase intent) continues to grow,” said one U.S. advertiser who wanted to remain anonymous to preserve their relationship with the platform.

Actually, these tailor-made audience bundles are so powerful that TikTok attributes them to playing a substantial, albeit somewhat discreet, role in Amazon’s Prime Day success. “Amazon had its single largest sales day in company history ($11.9B in gross merchandise revenue) on Prime Day 2023 and a significant factor that led to this was Amazon and its merchants’ larger presence advertising on TikTok, many of which used similar custom audiences,” the email said.

Additional TikTok stats (per TIkTok)

  • Nearly 70% of users are expected to make a Black Friday purchase
  • Black Friday/Cyber Monday is the “#1 most shopped time by TikTok users”
  • 80% of users who bought something on Black Friday last year said TikTok played a role in their purchase decision

A one pager, which was attached to the same email to advertisers, cited additional internal stats about why Black Friday is such a big shopping moment for users on its platform. The entertainment platform added that “it would be a travesty not to reach them for the big event” because Black Friday/Cyber Monday is the “#1 most shopped time by TikTok users.”

These are bold claims from TikTok, and there may still be many marketers who need more convincing. Not least because they’re able to do the same thing elsewhere on more tried-and-tested platforms.

Despite her own reservations, Feazell hasn’t ruled out the idea of getting these audiences for her e-commerce clients during the holidays in the future. Ignoring this option would mean overlooking the fact TikTok excels at raising awareness for products and services.

“TikTok’s advertising algorithm has never competed with Meta’s Facebook and Instagram, in terms of efficiency,” she said. “With how its [TikTok’s] advertising platform performs [for us], it’s great for engagement, for introducing new products if you have a young target audience segment that’s so engaged with the platform.”

Events like Black Friday are also key opportunities to grow data. 

As Faezell noted, the platform likely knows it isn’t the first choice destination (yet) for e-commerce, so incentivizing advertisers by giving strong recommendations and unique audiences might influence someone in test mode on the platform, who hasn’t experimented with it fully.

“Most e-commerce or retail advertisers recognize the opportunity TikTok can provide for increased and incremental sales, and likely were already considering an investment or a larger investment compared to past years,” agreed Rumpler. “Certainly, the creative assistance and possibility of unique audience segmentation could provide a tipping point opportunity for advertisers to lean in.”

https://digiday.com/?p=521798

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