Yikai Li | Source | General Manager of Global Business at Nativex

A recent report by MediaRadar revealed that TikTok ad spending soared to an impressive $1.2 billion in the final quarter of 2023, representing a significant 43% increase compared to earlier in the year. Leading brands like Amazon, Apple, Comcast, DoorDash, and Disney were among those driving this surge.

Furthermore, by the conclusion of 2023, nearly 30,000 companies had invested in TikTok ads, contributing to a staggering total of $3.8 billion for the year. Analysts also predict that TikTok will outpace Facebook in daily usage by 2025, highlighting its growing significance in advertising.

Here with commentary is former ByteDance exec Yikai Li, currently Nativex GM of Europe and North America:

"One undeniable truth emerged: TikTok's unprecedented rise is reshaping the digital landscape. As users devote increasing amounts of their precious time to the platform, it's inevitable that advertising budgets will follow suit. But what truly sets TikTok apart from the likes of Facebook, Instagram, and YouTube is its dynamic ecosystem. The rapid expansion of TikTok Shop in recent quarters underscores its potential to revolutionize e-commerce. In an era where brands are tightening their belts on traditional branding strategies, TikTok Shop emerges as a beacon of innovation, offering a fresh avenue to strengthen brand affinity and drive tangible results. It's not just a trend; it's a transformative narrative that brands simply cannot afford to ignore."

On behalf of Nativex, a TikTok marketing partner, here is commentary from Yikai Li, GM Europe and North America, regarding TikTok's exciting expansion into livestreaming.

According to an article in The Information, “In the third quarter, TikTok users sent more than $250 million worth of digital gifts to U.S.-based TikTok livestreamers, according to a person with direct knowledge of the matter. That figure—calculated after Apple or Google has taken a 30% commission standard across in-app purchases—was nearly 20% higher than the second quarter’s haul of $214 million. TikTok keeps half of this money, which amounted to $125 million in the third quarter. At that rate, TikTok is on track to earn $500 million a year in tips just from the U.S. That’s still small compared to advertising. Last year, for instance, TikTok expected to produce $10 billion in advertising globally.”

Here is commentary from Yikai on TikTok’s expansion into livestreaming:

“Why Livestreaming is a good feature for TikTok:
It helps TikTok to maintain/increase the active user numbers and time spend
It helps further lower the threshold to be a creator - the user doesn't need to create any content but turn on their livestreaming
It helps to generate the user behavior to browse livestreaming, and then they may come across livestreaming shopping.

When discussing the TikTok livestreaming feature, we must note that it is a consumer-facing product, not for business. Though brands can leverage the feature to do livestreaming shopping, that business goes with the TikTik Shop feature. (So when we are discussing livestreaming business, I suppose we are only talking about the user side, not brands)

For companies making money through traffic, IAA(in-app advertisement) is always the only option. (Facebook, Google, and previous TikTok) But livestreaming helps TikTok to change the game. Livestreaming is more of an IAP(in-app purchase) way to monetize. As we all know, IAP is more efficient than IAA in monetizing.”

As one of the top global TikTok performance ad agencies, Nativex has the access and experience to help brands expand their advertising channels, grow their business, and bring awareness to a whole new segment of mobile users.

1. TikTok Shop sees more growth in 2024
“In 2024, TikTok Shop will continue to experience a significant uptick in activity, presenting a key growth opportunity for both TikTok and its partners. E-commerce will be an essential focal point, driving increased engagement and revenue.

Expect more influencers to join TikTok Shop, incorporating products seamlessly into their videos. More users creating content on the platform will create a diverse shopping experience, from product promotions to organically embedded items.

Brands will actively embrace TikTok Shop, creating accounts and consistently using live streams and content for product sales. Known successful social media practices from observing Douyin, signaling a broader shift toward e-commerce.

As influencers and brands thrive on TikTok Shop, celebrities will likely follow suit, leveraging the platform for product sales and managing their businesses. This collective participation will make TikTok Shop a dynamic e-commerce hub in 2024.”

2. TikTok Live Streaming will see more growth in 2024
“In 2024, TikTok Live Streaming will surge in activity targeting consumers and businesses. This rapid growth on the platform will happen once there’s a shift from advertising to consumer-driven revenue, which some are strategizing toward already.

Live streaming's direct consumer monetization sets it apart from standard practices, offering a more efficient and diverse alternative to traditional advertising. With increasingly constrained budgets for entertainment resources, TikTok Live Streaming on mobile screens emerges as a cost-effective choice.

This feature not only sustains or boosts user engagement but also lowers the user barrier to becoming creators, requiring no brand-driven content creation (i.e. brand partnerships, or advertising format requirements, etc.). It stimulates user behavior, driving exploration of live content potentially leading to the discovery of live-streaming shopping features organically.

Overall, TikTok Live Streaming represents a departure from the conventional in-app advertisement model. In comes a more efficient in-app purchase method for monetization. Redefining how TikTok generates revenue and presents new opportunities for users and the platform in 2024.”

3. TikTok to streamline influencer marketing agency partners
“In 2024, TikTok is anticipated to streamline its influencer marketing partnerships by reducing the number of agency collaborators. Observations suggest that a need for more control and trust in the influencer marketing space drives TikTok's move towards an in-house team managing influencers directly.

The rationale behind this shift is rooted in the realization that not all agencies can effectively handle influencer marketing on TikTok. The platform seeks to work with agencies with expertise and a presence in specific markets, avoiding partnerships with those lacking market-specific proficiency.

For agencies like Nativex, this presents both challenges and opportunities. While TikTok aims to consolidate partnerships with agencies capable of delivering quality services, agencies with a strong market presence and expertise stand to maintain their relevance in this evolving landscape. This shift aligns with TikTok's strategy to improve organization, enhance quality, and streamline operations in the influencer marketing domain."

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