If the sun goes down on Facebook,
TikTok is dancing in the moonlight. How long can its short-form video capture the attention of fickle consumers?
Just a few years ago, China-based ByteDance’s TikTok was an app for kids, featuring videos of anthropomorphized pets or kids with monstrous dancing talents. Now it seems everyone is using it, regardless of their age. Its growth has come with its competition, so that almost every social media company is now pouring money into imitation products.
TikTok’s founding genius was that it took advantage of the brief and erratic consumer attention span with a seemingly limitless collection of under 60-second music-supported videos that were algorithmically tailored to user preferences. Those who still get bored in less than a minute can simply swipe until something else catches their eye.
In its latest installment of what it believes to be the longest-running survey of digital media consumer behavior in the US, Edison Research found that 82% of US adults polled currently use digital media. social media usage, unchanged from last year. What that means is that, unlike most other areas of tech like food delivery, ride hailing or dating, social networking apps are competing for the same users, not the same users. newbie.
It’s a game that TikTok is winning. Back in 2019, 70% of 10-year-old girls with smartphones in the US were using TikTok. Today, Edison Research’s survey found that TikTok is the third most used social media app across users of all ages, topping Twitter.,
Pinterest and LinkedIn. About 36% of the US population over 12 years old polled are using TikTok as of this year, just behind Meta‘S
Facebook and Instagram, and up from 11% two years ago. During that time period, the percentage of Snapchat, LinkedIn and Pinterest users fell, the survey found.
But for younger users, the benefits seem to come at Facebook’s specific expense. According to the survey, more 12- to 34-year-olds are using TikTok than Facebook, a marked change from just two years ago, when Facebook led TikTok in demographics by 39 percentage points. It’s not just young people who stray from social media incumbents: Only 5% of 35- to 54-year-olds used TikTok two years ago; now more than a third of them are. During that time period, the percentage of that age demographic using Snapchat and LinkedIn didn’t increase at all, while it fell 5 percentage points on Pinterest.
Overall, TikTok’s profitability demonstrates its ability to close the age gap soon — a unique differentiator among its competitors on the social network. Snap Inc. says Snapchat reaches 75% of 13- to 34-year-olds in 20 countries, but doesn’t disclose its usage statistics among older demographics, suggesting far less impressive stats. . Pinterest has struggled to attract and maintain widespread use outside of its core demographic of mothers. And parent company Meta said its Facebook app lost daily users continuously in the fourth quarter, the first time at least since going public.
Accessibility is key. Evercore ISI analyst Mark Mahaney says part of TikTok’s appeal is its intuitiveness, calling it “extremely easy to use.” On TikTok, you open the app and start scrolling. Most other apps require you to sign up for an account before you can use them, and Snapchat, for example, opens the camera — which can be intimidating for some people. It’s also easy for TikTok to contribute; Anyone can be a content contributor.
Facebook and Instagram now have a Reels short-form video platform. Pinterest last year added Watch, where users can scroll through short videos and series of images. Snapchat launched its short-form video product Spotlight in late 2020. Last year, YouTube launched Shorts globally, providing a platform for videos under 60 seconds. And even Twitter in December said it was testing an updated “Discover” tab in a TikTok-like scrolling format that appears to favor short-form video tweets. TikTok’s short-form video concept even spills over into television with Netflix‘S
Fast Laughs, a feature that first debuted on the mobile app last year, offers short clips from Netflix shows.
TikTok, like its social media predecessors, is free to download and operates an ad-based model. As a private company, its exact revenue is not made public. But eMarketer estimates TikTok generated nearly $4 billion in ad revenue last year and will triple that this year to become larger than the ad businesses of Twitter and Snapchat combined. . By 2024, the company’s estimates show that TikTok’s revenue is essentially on par with YouTube’s at more than $23 billion.
Analysts are confused about TikTok’s impact on social media from an advertising perspective. Stifel‘S
Mark Kelley called TikTok a “manageable threat” to social media incumbents, noting that the platform previously lacked the targeting and measurement tools available from platforms competition that advertisers want. Evercore ISI’s Mahaney says that while advertisers are clearly looking to experiment with TikTok, he has yet to see big brand advertisers fully engage.
AB Bernstein analysts said global investors remained “worried” about the competitive impact TikTok could have in the coming years, given the success of ByteDance and its version of TikTok in China. Quoc, Douyin. The company notes that Douyin accounted for about 40% of total increased Internet usage time in China between 2018 and 2021, and that, overall, Bytedance captured more than 50% market share of incremental advertising dollars in the two quarters. via.
TikTok seems to be working hard to address some of its shortcomings from both an advertiser and user perspective. Earlier this year, the platform enhanced its value proposition targeting and measurement capabilities for advertisers by enabling first- and third-party cookies on its existing tools. . It also recently shared 50% of revenue with creators on ads alongside its most popular videos. Revenue Sharing is a concept that has long been used to help incentivize creators on YouTube, and a Meta that has been discovered on Reels.
TikTok is also expanding from its short form platform. Less than a year after increasing the maximum video length to three minutes, earlier this year TikTok said it would extend that length to 10 minutes. Traditional YouTube videos can be up to 15 minutes long, and verified users’ videos can last for hours.
It is possible that advertisers will come, wherever the users are. The same site’s data shows that traffic to TikTok’s advertising site increased by nearly 200% in the first quarter. Users of TikTok’s Android app spent an average of more than an hour and 22 minutes a day on the service in March — more than Facebook, Instagram, Twitter, Snapchat or YouTube, data from Similarweb shows.
As an advertising business at the forefront of user-generated content, TikTok faces many of the same controversies that have affected Meta’s apps — specifically what it does with users’ data. The app is banned in India because of security risks. It has also faced scrutiny from US lawmakers over its algorithms, which could push users down potentially unhealthy vulnerabilities. Late last year, TikTok said it would adjust its recommendation algorithm to avoid showing users too much of the same content.
Internally, TikTok’s rapid growth has required a rigorous process. A Wall Street Journal investigation last week revealed America’s work culture is described as demanding and secretive, with some former employees describing 85 hours of meetings per week outside of their usual work. surname. It also uncovered multiple instances of cultural conflict between the US operation and its Beijing-based parent company. TikTok had about 1,500 employees in the US last year and plans to add 10,000 more, the Journal reports.
But will its investment continue to pay off?
Evercore ISI’s Mahaney said: “I cannot sit here and say in 10 years they will still be the dominant platform. however, he also notes that over a billion users will likely buy you at least “a few years” shortly.
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https://www.wsj.com/articles/tiktok-is-eating-up-rivals-can-it-keep-users-hooked-11652434227?mod=pls_whats_news_us_business_f TikTok Is Eating Up Rivals. Can It Keep Users Hooked?