TikTok Uncertainty: Our Take

At Brkthru, we approach any problem or roadblock with a solution for our clients. With TikTok facing scrutiny from the U.S. government and other contingents, our team of media experts are following the daily developments closely to ensure our clients are set up for success, no matter the changes on the horizon.

TikTok’s Power: Attention

According to eMarketer, adults between 25 and 54 spend over 45 minutes per day on TikTok, while Gen Z users spend an astounding 1 hour and 20 minutes on the app daily. Because of its surging popularity, TikTok has increasingly become an important tool in reaching younger consumers. While Facebook and Instagram have rolled back options to target users under 18, TikTok has continued to allow marketers to reach these users with ease and affordability.

The Controversy

TikTok is owned by ByteDance, a company in which the Chinese government owns a minority stake. Like most social media apps, TikTok has a massive amount of information on its users, from device types, location history, search and browsing behavior, to how long they spend with specific content. Researchers and politicians fear this information could be shared directly with the Chinese government and used in nefarious ways, even posing a U.S. national security risk.

The White House has given an order to federal agencies to remove TikTok from government devices, with many state governments following suit. Some public universities and school systems have even blocked TikTok from being used on their WiFi networks. Most recently, the United States House of Representatives voted to advance a bill granting President Biden the power to unilaterally ban TikTok in the U.S.

Concurrently amid these mounting pressures, TikTok announced a 60-minute daily time limit for minors, requiring teens under 18 to enter a passcode and ‘actively decide’ to continue watching. Users under the age of 13 will require a parent or guardian to approve additional time in 30-minute increments. These changes are expected to be implemented in the coming weeks.

Our Take

A complete ban of TikTok in the U.S. is unlikely, but cannot be ignored. Despite the genuine privacy concerns, a total ban could inflict real political damage with an important portion of the electorate. Instead, we predict U.S. regulators will enforce more strict privacy standards upon TikTok, or force the sale to a U.S. buyer.

Whether TikTok is moderated in time consumption, or completely restricted, the craving for entertainment, especially on mobile devices, will not disappear. Audiences will likely flock to Snapchat, Instagram, and YouTube, where they can access the same short-form video. 

YouTube

After TikTok, YouTube is where US adults spend the most time per day, at just over 47 minutes. In an attempt to gain share of TikTok’s audience, YouTube rolled out its own short-form video product called Shorts. To incentivize popular creators to use the platform, YouTube debuted a revenue sharing program to Shorts creators in February. The platform has surpassed over 50 billion daily views according to parent-company Alphabet. Aside from Shorts, YouTube remains a go-to for most video content and has access to Google’s rich first-party data that can be used for ad targeting.

Snapchat

As news over lawmaker efforts to ban TikTok has emerged, Snapchat has been a key beneficiary, with its stock surging over 9% in early March amidst speculation of a TikTok ban. The company has reason to share the optimism –– US adults spend over 37 minutes per day on Snapchat, and some estimates suggest that 10% of people in the world over the age of 13 use the app. With 107 million daily active users in the US, Snapchat is a strong alternative should TikTok face legal or regulatory issues.

Instagram

Finally, Meta-owned Instagram continues to be a popular app with teens and young adults, garnering 46 minutes per day on average for anyone above 18. Reels, the app’s short form video feature, is a mirror image of TikTok. A key advantage for advertisers is Instagram’s ability to utilize all of Meta’s interest data, which has become increasingly important as the accuracy of third-party cookies declines. Instagram has also been the go-to app for influencer marketing, more than doubling the spend on TikTok. This year, 133.5 million people in the US will use Instagram compared to 102.4 million TikTok users. That’s significant, because most Instagram users will be Reels viewers, as any video under 15 minutes is automatically uploaded as a Reel.

At Brkthru, we’re on it 24/7, and we have a data-driven solution for our clients no matter the outcome. Have any questions? We’re all ears. Reach out to your Client Success Director or email us at info@brkthru.com.