Interpret: TikTok users more likely to engage with ads

Despite growing national security concerns, short-from video platform remains as popular as ever. And as more and more young consumers leverage the platform instead of Google search to find popular restaurants, stores, and other places to spend their money, the advertising implications are potentially huge.

Savvy businesses that have leaned into TikTok to reach Gen Zers have already been reaping the rewards, as recent TikTok survey data finds that 78% of small businesses that have run ads on the platform have realized an ROI within six months. In addition, over half of businesses that spent on TikTok advertising intend to increase their ad spend for the platform this year.

The interest from businesses makes sense, as Interpret’s New Media Measure® shows TikTok users typically will engage with advertising or sponsors more than the general US population – 17% of TikTok users report clicking on an ad on any social network platform on a weekly basis, compared to 14% of gen pop. Moreover, this level of ad tolerance carries over into other entertainment as well, as 45% of TikTok users state being okay with short ads when watching video on a streaming media device or smart TV.

Recognizing the power its platform is attaining, TikTok management decided late last year to tackle not just advertising but also ecommerce in America, which could carve a small slice of market share away from retail behemoths like Amazon and Walmart. Ecommerce on TikTok is already huge in China (where it’s called Douyin), and TikTok is hopeful to achieve similar success stateside.  “The goal is to import a version of China’s $400 billion livestream shopping industry to the US, where the format is still largely synonymous with television networks like QVC,” a TikTok representative noted last November.

TikTok’s own survey of small business owners found that 92% intend to include TikTok in their 2023 marketing strategy, while 79% of consumers think TikTok Shop will take business away from Amazon. It’ll be interesting to see just how much ground TikTok can secure in both advertising and ecommerce in 2023.