Advertisers are sticking by TikTok and continuing to spend to appear on its platform despite growing tensions about a potential US ban.
Chinese-owned TikTok is currently fighting to stop a ban in the US after the government passed a bill that grants the President the power to block apps that pose a security risk.
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The US, and other nations around the globe, have already banned the popular application from government phones.
Despite the threat, TikTok’s advertising business has continued to grow – with predictions that it will increase 36% to $6.83bn this year alone.
“The upside of advertising on TikTok still outweighs any threat of a ban looming, with short-form video ad spend continuing to grow at a significant rate,” Stevie Johnson, founder of marketing agency Disrupt, told Verdict.
During a presentation to advertisers this week, TikTok announced a new advertising format that lets brands place ads next to large-scale publishers. The “premium” publishers, like WWE and BuzzFeed, will get 50% of the collected ad revenue.
Johnson added: “It is by far the most impactful way to reach what traditionally has been a tricky audience in Gen-Z, and with the uptake in the older demographic, advertisers will fall behind unless they continue to utilise it.
“Additionally, other platforms [that] have taken reputational hits in the past, such as Meta, continue to prosper.”
GlobalData is the parent company of Verdict and its sister publications.
