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Why Ecommerce Advertisers are betting on TikTok
With more of our lives now happening online, social media is no longer optional for brands. According to research from Flywheel, 78% of consumers are now accustomed to spending more time interacting with people and brands through virtual social channels.
But just as brands began to embrace social commerce – a term used to describe retail opportunities and solutions presented by social media– TikTok’s popularity and influence led to an entirely new way of brand discovery and purchase: the rise of what it terms ‘community commerce’. With the concept of entertaining, compelling content that happens to feature brands, community commerce is creator-driven, word-of-mouth marketing that has taken over the short-form video platform and is considered more authentic to its environment.
With TikTok now surpassing more than one billion active users worldwide, advertisers are starting to take notice. Nowhere is this more important than in Southeast Asia, which is home to the majority of TikTok users (226.8 million), offering huge potential for brands to engage audiences as they rally around creators, particular interests, and trending hashtags.
TikTok’s bold ecommerce moves
A big part of TikTok’s success is the way it brings together crucial elements that make it stand out: short, snappy videos that are more light-hearted and authentic. The app is designed to feed users content based on their interests, and its real-time optimization algorithm is based on users’ interactions within the app.
Importantly, the content on the platform tends to appeal to a broad demographic of users between the ages of 10-49, and its emphasis on trends only adds to its relevance.
While people go to TikTok for its entertainment and creativity – audiences are also increasingly discovering new products via the platform. One example of this is the hashtag #TikTokMadeMeBuyIt, which has amassed over 14.9 billion views (last count) and chronicles people discovering products on the platform, buying them, and then posting a video about their experiences.
Brands big and small have seen huge increases in sales thanks to these trends. In 2021 alone, TikTok users spent approximately $2.3 billion in TikTok, an increase of 77%, according to data from mobile analytics company Sensor Tower – a number that’s expected to grow strongly in 2022, as the platform doubles down on community commerce.
Encouraged by its early success, TikTok is rapidly introducing new shopping features, including the launch of collection ads (which showcase a range of products on sale), dynamic product ads, and augmented reality features, such as a virtual try-on. Last year, the platform debuted a livestream shopping function, which showcases buyable products during a TikTok livestream. Then in October 2021, it announced a partnership with Shopify, enabling brands to drive sales directly through short videos and livestreams on their own TikTok accounts either through a product showcase or in collaboration with creators.
Best practices to succeed
The opportunities are apparent, but if brands are to fully capitalize on TikTok shopping behaviors, they must play to the platform’s strengths.
When working with influencers, it is essential for brands to let them guide the type of content that will appear on the platform. Not only will these influencers use a combination of their knowledge and data to appeal to users, but there is now enough evidence to show that users are better at creating compelling content about brands than brands themselves.
One study from Realeyes, a human attention and emotion measurement company, that compared TikTok user-generated content (UGC) videos, TikTok ads, Facebook ads and conventional ads, found that TikTok UGC videos performed 21% better than Facebook ads and 68% better than conventional ads.
Within this, the ‘Hashtag Challenge’ format is an attractive paid format with an incredible reach that encourages users to post videos of themselves with the brand’s hashtag visible. Recently, the platform launched the Hashtag Plus Challenge Format, allowing users to not only make and view videos but also purchase products directly through a separate tab on TikTok.
With more brands experimenting with the community commerce format, marketers must optimize their approach to ensure it stands out:
- Simple is better – avoid setting impossible dance routines that users struggle to remember.
- Brands and retailers must tailor their websites to match the content experience the user has clicked from.
- Advertisers should consider linking their hashtag challenges to major events and moments, to cut through the clutter.
Getting started
Brands can engage with TikTok users through organic reach, paid advertising, and influencers. As for the content itself, TikTok’s success hinges on three things:
- Music: Brands succeeding on TikTok often do so by embracing the platform’s musical theme
- Experiment: Create new experiences as TikTok users are more likely to embrace change
- Fun: TikTok users expect spontaneity and fun from brand content
In addition to the type of content created that can drive more interest in a brand's TikTok Shop, Pierre Faucher our Flywheel Digital expert shared in a recent article published in the Philippines Retailing Magazine, that it is critical to ensure that the content delivered is authentic, engaging and aligns on messaging, tone and branding.
"For maximum effectiveness, TikTok Shop should be managed as an integral part of an omnichannel online go-to-market and full-funnel marketing strategy to ensure content and messages are aligned and the shopping experience is seamless."
