4 Ways TikTok’s Ad Products Benefited From Competitors’ Mistakes

Though new to advertising, the video app TikTok is learning from competitors’ mistakes to forge strong relationships with buyers and to build a clear sales pitch.

Unlike Facebook, Instagram, YouTube and Snap, which focused on audience growth over advertising opportunities at first, TikTok understood early on how to successfully work with media buyers.

Facebook and Google have scaled and are focusing on bigger opportunities like cloud computing and TV, allowing TikTok to compete with better customer service. And Snap had to overcome an early reputation of being cocky and expensive when it first began pitching agencies.

“Unlike other platforms, TikTok realized sales, marketing and carving their place out in the marketplace was very important early on,” said Phillip Huynh, VP, national paid social strategy lead at 360i.

Ad products cater to different needs

TikTok has been professional and easy to work with since it rebranded from Musical.ly in mid 2018 and started ramping up in the United States, buyers tell AdExchanger.

Its ad products are both unique and easy to buy. Marketers can go all-in on a custom execution like a hashtag challenge, in which users post a video using a brand’s product, or they can buy in-feed ads, similar to Instagram or Snap stories.

“They gave a lot of thought to offering a range of products rather than saying, ‘This is what we have, period,’” said Noah Mallin, head of content and experience at Wavemaker. “They’re not forcing everyone into one buy or something that’s too expensive.”

By contrast, Snap’s early ad products were expensive and required custom creative requirements. They also focused on mass reach before launching self-serve, performance ad units that buyers wanted.

“Snap launching their paid options was very hit or miss,” Mallin said. “They had to go through a lot of iterations before they figured out what the market was looking for.”

Great value and easy execution

TikTok’s custom solutions are also much cheaper to deploy than other platforms. That’s partially because its audience isn’t as scaled as its competitors’. But brands who want to reach Gen Z with a custom takeover can do so at a third or a quarter of the cost on TikTok, said Talia Arnold, head of media strategy and planning at LA-based agency Exverus.

And TikTok’s in-feed ads have lower CPMs on average than videos on Facebook, YouTube or Snap.

“It’s way more efficient to get billions of impressions,” Arnold said. “They’re fighting for dollars, so it’s priced very competitively.”

TikTok’s prices won’t stay low forever, however, and marketers still need custom creative to take advantage of the platform’s native features. But thanks to the platforms that came before it, buyers have accepted that custom creative development is par for the course on social.

“A lot of the groundwork has been laid by Snapchat and Instagram,” Huynh said. “A few years ago, no one thought about vertical video, and now it’s part of every single spec sheet.”

Stellar service

TikTok needs strong service because it’s a challenger brand, and being a good partner to agencies is a huge part of moving from a test to always-on, Huynh said.

TikTok’s salesforce is still new and scrappy, but they’re responsive, nimble and open to brainstorm on creative. Big agencies have dedicated partners across accounts and for the agency itself to stay up to date on new features, which is similar to what other platforms offer.

But TikTok is very hands-on when it comes to working with influencers. Its sales team is willing to source and manage influencers and provide metrics around their audience, their content and whether it’s brand safe. TikTok content is also easy to share across platforms to scale out influencer campaigns.

“They’re very up front about talking about influencers as a valuable advertising play,” said Jon Morgenstern, SVP, head of investment at VaynerMedia.

Compared with Instagram that level of service is “night and day,” he added. Aside from YouTube’s acquisition of FameBit in 2016, most platforms avoid the complicated, low-margin talent-management business that comes with sourcing influencers.

A clear role

One of the most notable differences with TikTok is its immediate clarity as an advertising platform.

“Our interactions with them have started on the basis of having an opportunity for advertisers and creatives to collaborate,” said Rob Horler, CEO of influencer marketing agency Whalar.

Snap, on the other hand, had a weaker sales force and less of a partnership mindset. When the platform rolled out its Discover tab, buyers found it confusing to understand when to work with Snap and when to work directly with publishers.

Snap’s sales team has improved dramatically over the past few years, especially since it launched a self-serve offering and since Jeremi Gorman came on and reorganized the unit, buyers note. But in the beginning, that wasn’t always the case.

“When you have people knocking on your door, you have the mindset: ‘There’s all this demand, so we don’t have to necessarily make this easy for advertisers,’” Mallin said. “There was a little bit of that with Snap.”

Buyers appreciate that TikTok has clearly taken a look at competitors’ past approaches and come to the market with a more thoughtful and proven strategy.

“They are a beneficiary of Facebook, Instagram, Twitter, Pinterest and Snap,” Huynh said.

Where TikTok can improve

Despite a positive initial working relationship, buyers have a clear vision for what they want to see TikTok deliver on as it grows.

Aside from continued audience growth, buyers want to buy TikTok self-serve. TikTok is currently testing the early stages of a self-serve platform across the United States and Europe, according to Digiday.

“Self-serve allows us to be more efficient in how we buy, have a better window into performance against other platforms and be smarter about how we optimize,” Mallin said.

Buyers also want to see more easily deployable creative formats on TikTok, especially as large, legacy brands start testing the platform. But TikTok will have to be careful to balance more turnkey content creation with the integrity of the user experience, Arnold said.

“Bigger, legacy advertisers are not going to want to dedicate custom resources to TikTok content,” she said.

Measurement, of course, will be key. Buyers will demand third-party verification, and traditional advertisers will be hesitant to buy without proper measurement. They’ll also want to know that the more splashy, creative-heavy executions actually drive results.

“Brands who are regimented and looking for historical best practice are probably not activating on TikTok [yet],” Horler said.

 

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