TikTok’s small and medium business advertising is looking to emulate the success of social giant Facebook. But how do you go about getting the most out of the platform? As part of our deep dive into all things Mobile, we catch up with Lisa Friedrich, head of small business at TikTok, to find out.
The secret to Facebook’s growth into an internet titan was that it brought millions of small and medium businesses into spending on its platform. That strategy was so successful that its top 100 advertisers now make up only 20% of its ad revenue.
TikTok is fully aware of this – and is now courting these same businesses with guides, tutorials, support and best practice.
Small businesses naturally do not have marketing teams and advertising agencies on tap, and as a relatively new entrant into the social media space, TikTok has a lot of convincing to do and has to show results if it’s to prove to be a magnetic marketing platform. That is why it’s devoted a lot of resources into building a comprehensive how-to for businesses.
Friedrich says: “We’re trying to make it as easy as possible and, frankly, as least intimidating as possible. Building a TikTok can feel intimidating if you don’t feel like the most creative person, or if you have a million other things you need to do for your business.”
Having recently breached 100 million active users in Europe (a big part of why it recently activated its Euro 2020 sponsorship), TikTok is telling advertisers they can’t afford to ignore its audience. But the goal is to offer more. She claims her team’s job is not just to connect brands with the audience, but to support their efforts “as much as we can”.
TikTok makes a lot of big claims (citing its research, of course). It says 46% of TikTokers use the app to discover new things, 57% have used it to buy something, and 83% said it had a role in influencing a purchase decision. Additionally, it says the TikTok community is 15% more likely to buy from an SME compared to other social networks. If the insights are to be believed, there’s fertile soil here for brand activity.
The offensive kicked off in Europe in 2019, and really gained momentum in February 2020 when it sealed a partnership with Shopify to link the ads to the commerce side.
“I’m not joking when I say that February feels like a long time ago. We’ve seen tremendous growth in ecommerce. Last year, Shopify saw a 106% increase in new store creation growth year-on-year in the UK with over 135,000 businesses across the country now powered by the platform."
This is largely down to the TikTok Pixel, which tracks advertising activity on the app and beyond – all accessible through Shopify’s dashboard.
Who is TikTok for?
There are two segments of SMEs joining TikTok – those with existing businesses pivoting during the pandemic, and those starting with a TikTok-first strategy.
“We can say 100% that TikTok has driven that discovery for those brands, not just from our measurement studies with Kantar but first-hand from them.”
Freidrich suggests a minimum of $20 ad spend a day to get a good sense of reach. “That’s probably a baseline.”
From there it’s about deciding objectives, be it finding new audiences or retargeting people who’ve engaged with the website before. “We had to make it flexible and simple. When you’re up and coming, with a one-person side hustle, for example, you need to be able to start with a budget that feels actionable, but gets you a meaningful sample size to see true results.”
And that flexibility, she says, means the app can service all corners of the marketing funnel from performance to awareness – of course, SMEs are generally more focused on the sale at the start. “For them, it is about the conversion, because they have shorter windows, they have to be profitable within a certain time – we understand that.”
But as budgets expand, driving product page views and website traffic become important too. “I’ve never bought a product that I never heard about before. I need some kind of reassurance, whether that’s visiting their website or seeing their reviews.”
Despite being a late entrant to a social media market that has seen the importance of organic reach de-emphasized, Freidrich still encourages brands to dip their toes in. She says a lot of brands are opening profiles organically and getting good responses, including Little Moons Mochi ice cream balls, a business that had been around for around a decade before boosting sales by 200% (700% in Tesco) by putting a bit of time into a TikTok profile.
“Frankly, I think our community wants to help SMEs. With the pandemic, more people took up side hustles and businesses. We’ve just seen some really amazing inspiring stories of people.”
The winners, she says, “reinvented their businesses, were authentic and told their story.” She adds: “They didn’t try to manufacture anything, they talked about what they were passionate about, and our community was excited to watch along.”
But the move to TikTok can be intimidating. It is a creativity engine that can eat up or ignore content that doesn’t strike a trend. It is here Friedrich assures entrepreneurs to be themselves.
“Our platform is less about being perfectly polished – we’ve seen people just really talk about the blood, sweat and tears that go into building their business, and that resonates across our community.
“When that becomes an ad, you’re more in control of the placement because you can decide the targeting and the reach of that more effectively. I don’t think that the content and the message of your ad versus an organic TikTok should be dramatically different.”
Those who start building and testing in organic “naturally progress really strongly into ads”.
Oh My Lollypop’s Eryn Smith once posted about how hard it was to have a customer short-change her. She was quickly inundated with lollipop orders from sympathetic users and suffered a website crash.
“She was just being really honest about how hard it was and how much time she had spent on the order. She’s never ran an ad, she just told her story. She just talked about her work, which are basically beautiful works of art. Nothing about her TikTok was disingenuous – she was just literally sitting on the steps, lamenting how hard she works.”
Finally, Friedrich is on the panel of Purposeful Project, a platform funding entrepreneurs. Her role on the board reflects the fact that many of the entrants will be active advertisers on TikTok, representing its new role in the media mix.