<strong>TikTok Taking a Byte from Search Ads Market </strong>

TikTok Taking a Byte from Search Ads Market 

Bytedance is eager to sink its teeth into the Search Ads market. While still in its early stages, a full rollout of TikTok Search Ads features is likely in the coming months, signaling a move into Google’s territory. 

TikTok has emerged as one of the fastest growing social media platforms worldwide. It boasts over a billion active users and an active engagement rate as much as 15% stronger than other platforms

At present, advertising on TikTok is focused on the “For You” page, which produces algorithmic ad results based on defined interests, user engagement habits, and the basics of location and gender. While this allows companies to target users broadly, it hasn’t been possible to target keywords or phrases in any way besides hashtags. 

A limited beta for paid Search Ads was introduced at the end of last year, tantalising advertisers with the prospect of keywords. It all signals an astute (and perhaps inevitable) move into Google’s territory.  

The key details regarding Search Ads remain unknown and TikTok hasn’t realised much public information about their beta testing efforts. The feature was only initially discovered by accident and by some of the more discerning users.

David Herrmann, Twitter: https://twitter.com/herrmanndigital/status/1507104488011677703

As we can see, TikTok advertisers can target users who have searched for particular keywords or phrases. Search Ads seem set to appear just above “Others searched for” and will carry a “Sponsored” label. That’s as it stands right now, anyway.

This will prove a valuable addition to the overall TikTok marketing strategy, allowing businesses to reach users based on specific terms related to their product or service.

It’s something of a double-edged sword for TikTok is that its short-form videos are so fleeting — very much a case of ‘here today, gone tomorrow’. Ads lose their effectiveness much more rapidly than on search engines and even other social media platforms. It will be interesting to see if and how Search Ads changes that. 

TikTok is evolving as it grows. The platform boasts over 94 million monthly active users in the US and more than a billion in total globally, squaring-up to the dual Meta giants of Facebook and Instagram, with their 2.9 billion users and 2.2 billion each (though it’s difficult to obtain data on how many unique users that adds up to). 

TikTok generated over $4 billion in ad revenue in 2021. That figure is expected to double by 2024. Ad revenue per user hit $65.80 in 2022, marking a 170% increase and is projected to increase to over $110 by 2024. 

One key stat is that TikTok is “only” the fifth player in terms of US digital ad spend, behind Google, Meta, Amazon, and Microsoft. It is also cheaper. According to data by VaynerMedia, TikTok’s video advertising cost in 2022 was nearly 50% less than Instagram Reels to reach 1000 impressions, 33% less than Twitter, and 62% less than Snapchat. It’s quite plausible that TikTok will offer more affordable rates than those offered than its competitors.

TikTok’s grip on youngsters is almost certain to drive future growth: under 20s represent 25% of users, while 22.4% are aged 20-29. Teenagers and young adults tend to go about things differently online. Google’s Senior Vice President, Prabhakar Raghavan, has himself noted: “Something like almost 40% of young people, when they’re looking for a place for lunch, they don’t go to Google Maps or Search. They go to TikTok or Instagram.” 

Overall, 45% of TikTok users are aged 20-39 and that’s the single most important group for merchants and advertisers. There’s a lot of promise for those who can optimise ads to reap the rewards. TikTok own recent advertising encourages you to “Search it with TikTok.” 

TikTok has always presented a bit of a challenge in terms of gauging the success of campaigns. Tracking clicks and likes alone is not enough to get a deep understanding of impact. They have, however, launched Ad Library, which enables marketers to search for the top performing ads in a range of categories. The new tool makes it possible to explore the ads that have reached the most users and filter those ads by region or industry.  

More tools seem to be coming all the time. If TikTok can help reach specific audiences through better targeting, more advertisers will jump on the bandwagon. For consumers, TikTok’s Search Ads may result in more relevant and personalised ads to fit their interests. 

It’s no secret (or coincidence) that TikTok also has ambitions of becoming a major E-commerce platform. The TikTok Shop was given a soft launch in November, but as yet remains in the early stages. Instagram has been in the game for a while now with its own Search Ads. Insta users can already buy products they see without ever leaving the app. TikTok wants to follow suit. Interestingly, Amazon has launched its own short-form video iOS and Android app, dubbed Inspire. The app remains in a beta state and has been met with only modest interest thus far. 

Some in the industry remain sceptical whether the platform is a safe bet given attention received from global regulators over security concerns. The use of TikTok on government-issued devices has already been banned in the US and Canada.  A broader nationwide ban seems unlikely. Nevertheless, TikTok’s leaders have allegedly discussed splitting entirely from their Chinese parent company.

It will be interesting to see how things shape up in 2023. What’s for certain is that TikTok needs to provide top-notch features and competitive pricing to entice advertisers to its platform. It is, after all, a market in which Google holds a significant advantage.  

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