TikTok’s ghosts of Christmas past, present and future
This editorial series examines industry trends across the media, media buying and marketing sectors as 2023 closes and the new year begins. More from the series →
The past 12 months have certainly been colorful for TikTok, by way of publicity, bans, creators and new products dotted throughout the months. In true Digiday style, we caught up with five ad executives to get their takes on what went right (and wrong) for the platform during 2023, and what their expectations are for next year.
In a nod to “A Christmas Carol” — here’s TikTok in the form of Christmas past, present and future.
TikTok started the year in the hot seat, with CEO Shou Chew in front of U.S. Congress, as its longevity in North America hung in the air. And while these days, marketers seem quietly confident that the app won’t get banned, at least not anytime soon, some aren’t necessarily sure that the platform’s response to that potential ban was good enough. After all, the issue initially gained steam during Trump’s presidency, and reared its head again last year during Biden’s tenure. All the while, Republican presidential candidates for the 2024 election have vowed to ban the app once more.
“For really good reasons, they’re [TikTok is] focused on other areas that are doing better and are hoping that those things can outweigh the pressure to take a hard look at what they’re [TikTok is] doing from a data, privacy and security standpoint,” said Amy Rumpler, svp of search and social media services at Basis Technologies. Those successful areas include TikTok’s creator marketplace and music partnerships, for example.
And while one of the platform’s strongest elements — its creator community and subsequent marketplace — has done well to facilitate business opportunities between brands, agencies and creators, there are still question marks over how well the platform does (or doesn’t) pay that talent.
TikTok sunsetted its original Creator Fund on Dec. 16, and has put more focus into its latest monetization program, the Creativity Program Beta, which launched in January. The new and improved program, which was introduced following feedback from creators, replaces the platform’s original fund and rewards eligible creators that produce high quality, original content that is longer than one minute.
“It looks like they’re [TikTok is] really focusing on the idea that if they’re going to pay creators directly, they’ll do it to support the platform’s business initiatives, whether it’s shopping, music or long form, etc.,” said Jim Louderback, founder of Inside the Creator Economy newsletter and former CEO of VidCon. “I don’t think they’ve figured out how to really ensure creators are getting compensated for their work, in as comprehensive a way as YouTube has. So I think they’re still trying to figure out what they’re doing there.”
The same goes for retail. The app’s biggest launch this year in the U.S. — TikTok Shop — received a mixed reception from marketers. The problem was the lack of quality products being sold, according to Tom Sweeney, global vp, influencer, at Brainlabs. “It wasn’t taken seriously, so it felt like Alibaba with video. You felt like you were buying low quality drop ship junk. And I think the issue that the audiences had was that it was never going to be successful because it felt like a budget QVC,” Sweeney said.
That said, it’s still early days, and the platform is known to iron out kinks relatively quickly. For starters, last month, TikTok removed a number of Shops due to copyright infringement.
But as bad as these issues were for TikTok, it also had a lot to be pleased about.
As Kolin Kleveno, svp of partnerships at Tinuiti, put it, the platform actually did significant foundational laying this year, with the likes of Shop, search and even OOH.
Not to mention growing commitment from marketers. This year, they’ve been especially impressed with its advertising platform. Compared to some of its more established peers, TikTok’s tools have been stable, with little to no technical bugs or issues, said Rumpler.
“I think TikTok’s targeting, the ad formats, have really evolved a lot over the last year and a half. It’s easy to use, easy to place ads, and I think that’s been a bright spot,” she said. “TikTok is still a newish platform in that regard, and you sometimes worry about turmoil and swirl but they’ve been continuing to improve and roll out new functionality at a speed that has been really impressive.”
Which makes sense, since a number of marketers whom Digiday has spoken with over the past few months have reiterated that TikTok’s team is proactive with providing incentives and support on a weekly basis. This became especially clear from the pitch decks that were floating around this year, which highlighted the platform’s 2023 TikTok Creative Exchange and Shop, as well as strategies for both Black Friday / Cyber Monday and the holiday period.
As things stand, TikTok is at somewhat of a crossroads. The algorithm that’s been the backbone of how much time people spend on the app is already starting to show signs of wear and tear.
“[From a user perspective] it feels like you have to search more and more for those moments of joy or moments of info you get from the platform, than you might have had to in the past,” said Amy Gilbert, vp of social innovation at The Social Element. “I think as the platform’s evolving, the challenge is how do they keep that piece [the algorithm] which makes it different, but also find new ways to bring those other elements [such as Shop, music, etc.] in.”
The answer is a work in progress: From prioritizing long form content, introducing search and partnering with Warner Bros. Music, to launching its own Shop and dipping its toe into the OOH sphere, TikTok is trying to be a place for people to do more than just watch quirky videos. It wants to reach the platform status enjoyed by the likes of Amazon, Google and Instagram. Sure, the reach is getting there — to compare, TikTok has more than 1 billion monthly active users globally, while Meta boasts 3 billion global users and, at least for Gen Z, TikTok has become a habitual part of daily life.
“They [TikTok] want to break the shackles and come out of the social jail, and be seen as an everything platform,” said Kleveno. “I don’t think they’re there yet, but you can see the path that it’s on. They release these big critical bases and Shops and [search] toggle — there’s going to be more advancements on them next year and you’re going to see it as much more of a destination.”
While marketers have a number of expectations for 2024, there is still a question mark over whether a resolution will be sought around the TikTok U.S. ban, given that other outright country blocks are still trickling in elsewhere, including in India and Somalia, and the most recent being Nepal. And then there’s the small matter of political elections on both sides of the Atlantic next year, with social media set to be a key battleground between the biggest platforms. This is despite the fact that the app is currently banned on government devices in the U.S., the U.K. and the European Parliament.
None of these issues seem to be major ones for marketers — for now at least. Rumpler, for instance, is one of a number of advertisers who expects her platform investment to grow next year.
“It feels like the road is primed for continued expanded growth, especially knowing the monthly active users, the attention that the platform is generating and able to drive is continuing to increase at this point,” she said. “We definitely foresee that it will continue to be a growing part of our media plans.”
If TikTok does garner more ad dollars, creators will be a big conduit of that. After all, they attract significant attention. So the challenge next year will be how TikTok can retain those creators for the long haul, especially the smaller ones it seems to be targeting these days.
“I think TikTok needs to figure out what to do when a creator grows up on the platform and becomes big, so they can retain them, or decide that’s not who they really are,” said Louderback. Simply put, TikTok needs to work out if it wants to maintain the entire life cycle of creators, or if it’s simply a stepping stone, or a launch pad for success.
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