Following a decrease in global ad spending, Twitter has lowered the cost of its digital ads to secure more advertisers and try to pull them away from rivals, Meta, YouTube, and Twitter.
The Financial Times reported last week that rival social media platforms such as Twitter, Instagram and Facebook are seeing reduced ad spends, as advertisers and brands turn to TikTok to save money and enjoy better levels of engagement.
Furthermore, data recorded in 2022 by New York agency VaynerMedia revealed the cost to obtain 1,000 impressions from digital ads on TikTok was almost 50% less than Instagram Reels, one third cheaper than Twitter and 62% cheaper than advertising on Snapchat.
The rise of TikTok
Originally known as Musical.ly, the app was purchased by ByteDance in 2018 and changed its name to TikTok. Since then, it has grown significantly, with the latest TikTok stats suggesting the app has been installed 3 billion times, with more than 1 billion active users every month. Today, TikTok generates most of its revenue from advertising.
TikTok’s advertising boost
Despite the slowdown in global ad spending, TikTok continued to promise enhanced ad offerings for brands, which resulted in the top 1,000 advertisers in the US alone boosting their spend on the popular global app by 66% to $467 million from September to October 2022, according to market intelligence form, Pathmatics.
“So many of our brand partners. . . used to be 100 per cent Instagram,” Permele Doyle, founder and president of creative agency Billion Dollar Boy, was quoted by the FT as saying, adding: “Now for 2023, we’re seeing 80 or 100% TikTok.”
The future of TikTok
Market research firm Insider Intelligence have predicted that TikTok will soon surpass YouTube in viewing time, with the app’s social buyer penetration also climbing rapidly in the US, above Pinterest. By the end of 2023, the firm predicts TikTok will surpass Instagram and tie with Facebook.
TikTok offer cheaper ads – the view from Spike
While TikTok has noticeably lowered the cost of its digital ads, there has never been a better time for brands to take advantage of this opportunity and create fantastic advertising on the app. Whatever your budget, we advise brands to consider the significant savings to be made coupled with the level of potential engagement gained.