Why TikTok Is All the Rage with the Kids & Now With Marketers Too

Published in

Latitude

10 min readSep 26, 2019

Maybe you’ve heard TikTok mentioned in a news feed somewhere, seen it show up on the 50th-yard line of Soldier Field during a Chicago Bears game, or even tried it yourself. But, regardless of where you might’ve noticed it, TikTok is working its way into the fabric of pop culture in more and more places all the time. And, for marketers, that means potential opportunity.

But, what is TikTok?

Simply put, TikTok is a social media app that provides a place for people to create and share short-form videos of lip-syncing, cosplay, dancing, comedy, art and much more — especially now that big brands are joining in the action.

While it’s not exactly new, TikTok brings a new dimension and set of opportunities to end-users and advertisers alike in the realm of social media. Seeing TikTok’s potential to reach a younger audience in a fun, relatable, and often user-generated way, several brands are already enjoying some early success in using the app as a marketing platform.

Today, that’s what we explore — TikTok, its advertising potential, and how brands are accessing that potential right now.

But first, we’ll take a look behind TikTok itself.

TikTok, By the Numbers

As of October 2018, TikTok claimed over 500 million monthly users. And, although around 43% of TikTok’s user base lives in India, about 1 in every 8 US adults between the ages of 18–24 use the app. According to Konstruct Digital, 66% of TikTok’s users are less than 30 years of age.

On average, a user spends 4.9 minutes on TikTok compared to the 3.1 minute average for users on Instagram. Since the average user logs on to TikTok about 8 times a day, that means they spend about 40 minutes on the app per day overall. A study from Business of Apps even estimated that users could spend as much as 52 minutes on the app per day. And, with 37% of US app visitors coming from households with a combined yearly income of over $100,000 USD, many brands are eager to get TikTok users to spend even part of those 40 to 52 minutes watching ads for their brand or, better yet, engaging with their brands directly through sponsored hashtag challenges.

TikTok provides several ways for brands to interact with these users; here are a few:

Methods for Advertising on TikTok

Billable Ads — Similar to YouTube, advertisers sprinkle these short video ads into the video-feeds of app users.
Brand takeover — This type of ad shows up right away when users open up the app. For a day, your ad is king of TikTok and will greet each user every time they log in.
Hashtag Challenge — As one of the most organic forms of advertising on TikTok, hashtag challenges prompt users to create their own unique content centered around certain themes decided on by the brands issuing the challenge. As you might have imagined, they find a lot of success and popularity on TikTok — for both users and brands alike.
Branded Lenses — Like Snapchat and Instagram, TikTok offers brands the chance to create their own lenses that let users play around with unique special effects, like 3D objects and face filters.

With a variety of ways to engage users on the platform, how are brands using TikTok to reach potential customers? That’s what we explore next. Up first — Chipotle.

Chipotle’s Appetite for Innovation

If there were ever a brand to experiment with TikTok early on, destiny seemed to decide that brand should be Chipotle. As a disruptor to the food industry from its very first days, Chipotle leaned into the chance to experiment on this new platform. Rather than settling for a one-off brand takeover or a series of in-feed video ads, Chipotle decided to engage fans on TikTok by challenging them to create their own video content. Thus, the Lid Flip Challenge (and later on, the Guac Dance) was born.

The Lid Flip Challenge involved getting Chipotle customers to utilize a burrito bowl to flip its own lid back onto itself. If that doesn’t make much sense, just watch the first ten seconds of the video above. What really makes sense are the reasons why Chipotle elected to engage with fans through a challenge rather than a run-of-the-mill ad.

Within the first six days of the challenge, Chipotle received 104 million video starts from participants. After about a month, #ChipotleLidFlip received more than 230 million views in total. At that point, Chipotle knew they had struck #gold. According to Chris Brandt, Chipotle’s Chief Marketing Officer, “We knew this (lid flip) was the right thing to get started with. It was relatable. You can do it at home. We just wanted to try some things and see what happened. We didn’t know how it would do. I’d say with 230 million views, we were off to a good start.” For Chipotle, the fun was just beginning.

Hungering for more success, Chipotle later launched the #GuacDance challenge, which drew its inspiration from Dr. Jean’s “Guacamole Song.” Following Jean’s example, TikTok users got to work choreographing and posting their own avocado-themed dance moves. Within six days, Chipotle’s challenge generated 250,000 video submissions and 430 million video starts — which ended up being TikTok’s best performing brand challenge in the United States up until that point.

The ROI on Chipotle’s #Challenge

So, how does Chipotle’s engagement on TikTok translate into an ROI? Although that can always prove challenging to measure, here’s what we know for sure — Chipotle recently experienced its most successful guacamole day in the chain’s history. On this historic day, the company served over 800,000 sides of guac, resulting in a 68% increase in their avocado consumption on July 31 (National Avocado Day). How’s that for a satisfying return?

Honorable Mention — Ralph Lauren

While Chipotle might be the most successful brand employing the hashtag challenge, it isn’t the only one that found success through the tactic. Representing the clothing industry, Polo Ralph Lauren recently launched its own challenge under the hashtag, #winningRL. To inspire TikTok users, Ralph Lauren released a series of tennis videos featuring “Booksmart” actress Diana Silvers.

As part of the challenge, the brand prompted TikTok fans to create their own videos of them winning at something. By asking for videos of something as nonspecific as “winning,” Ralph Lauren leaves plenty of room open for creative interpretation and organic content creation from potential customers. In the end, that’s the prize. When you can motivate fans to push and advertise your brand for you, you know you’re already #winning as a marketer.

Kroger Takes It Up a Notch

Like Chipotle and Ralph Lauran, Kroger also decided to give TikTok’s hashtag challenge a try with its #TransformUrDorm challenge that urges college students to create before and after videos of their newly furnished dorm rooms. Unlike brands before it, Kroger breaks new ground in the TikTok world by being among the first brands to include an option for app users to shop for Kroger products on a brand page embedded within the app. Without leaving TikTok, users can visit Kroger’s page and shop for items ranging from granola bars and mac and cheese to laundry baskets and popcorn makers.

In this case, It’s not just a hashtag challenge — it’s a “hashtag challenge plus,” according to TikTok. Beyond granting Kroger their designated brand page with its in-app shopping features, TikTok placed Kroger’s challenge into the app’s main discover feed where it could receive added exposure among users searching around for popular videos to watch. Like other brands before it, Kroger utilized the reach of TikTok influencers by prompting them to create their own dorm transformation videos that inspire fans to do the same.

Right now, influencers on TikTok that have more than 2.5 million followers charge between $500 to $800 for every post compared to $100 for every 10,000 followers on Instagram. But, for the opportunity to place their products and brand in front of millions of engaged app users who might be inspired to create Kroger videos of their own, the price may well be worth it.

The NFL’s Quest to #Win with TikTok

As an early adopter of previous social media platforms like Twitter and Snapchat, the NFL naturally found its way towards TikTok. Just before the start of the league’s 100th Season, the NFL announced its partnership with TikTik, which would include an official account and, in true TikTok fashion, a series of NFL-themed hashtag challenges (#WeReady).

When it launched, the official NFL account included behind-the-scenes videos and highlight reels in addition to more light-hearted memes with some motivational content spritzed in for good measure. As ratings waver, the NFL hopes to use TikTok to reach fans in new and relevant ways, especially fans who live outside of the US. TikTok, with its large following outside of the US, might be able to help.

Even then, for all its promise, TikTok finds itself a long way from a guaranteed success. After all, there’s competition in town.

Instagram’s on TikTok’s Heels

As a giant social media app competing for the limited attention of the same people, Facebook-owned Instagram might just prove TikTok’s undoing. Although an innovator in its own right, Facebook doesn’t always find itself at the forefront of social media innovation. And, when that’s the case, the company often seeks to replicate what it can’t invent originally.

Facebook employed this tactic years ago by creating Instagram Stories as a way to compete with Snapchat. And, it worked. Snapchat’s growth more-or-less stagnated with the introduction of Instagram stories — an edition that replicated the function Snapchat built itself off of previously.

With TikTok gaining steam, Facebook and Instagram appear intent on employing that same tactic once again to stifle the progress of their new rival. According to Jane Manchun Wong, the famous reverse engineering expert, Instagram is already working on a feature to copy TikTok. “Clips,” as its called, will allow Instagram users to….basically do what TikTok does in a nutshell.

Regardless of what you think about it, the replication tactic worked in the past for Facebook. And, with TikTok’s long-term viability in question, the tactic might just work again. TikTok’ inclination towards withholding information about its engagement rates seems to arouse some of those suspicions. Some experts speculate that TikTok engagement drops off significantly after thirty days or so as users once again migrate back to apps they already understand and have existing networks on. And that’s right where Facebook stands to gain its edge.

Will Facebook prevail? That remains to be seen.

The Takeaway:

Regardless of the possible outcomes, one thing remains certain — TikTok has potential and it’s worth exploring, especially while the game is still young.

How can marketers and brands get into the mix?

Challenge dedicated app users to create their own content. Get users to engage with, learn about, and promote your brand for you.
Recruit the help of digital TikTok influencers. They know how TikTok works. In this world, they’re the early experts.
Experiment with running ads that mirror the type of music-video content that TikTok users prefer already. Don’t run an ad. Premier a music video.
Time your ads appropriately. Like Chipotle making the most of National Avocado day, tie in your ads in with other cultural events. Make your ads part of the conversations and trends already occurring. Own a donut shop? Make a video for National Donut Day.

Want to learn more? Feel free to reach out at any time. We would love to chat!

The above piece was written by the Latitude Supercharge Research Team, which includes Connor Beck and Carter Jensen

Supporting Resources

Resources and original reporting of the above points covered by the following publications — The New York Times, Social Media Today, Konstruct Digital, AdWeek, BizWomen, Tech Crunch, Forbes

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