TikTok preps its advertisers for possible ban

Platform Economy: TikTok smartphone app

TikTok is preparing its advertisers of a possible ban of its app in the United States, advertising buyers said.

The video app’s advertising business is still nascent. TikTok’s estimated $1 billion in 2020 earnings is a small portion of its Chinese owner ByteDance’s total sales. But TikTok is now a favourite location for brands which aim to reach the young taste-makers, who flock for dancing, lip-syncing and comedy sketch videos of the app.

TikTok said it will continue to honour planned advertising campaigns, refund any that it can’t meet and would also work with important influencers to migrate to other platforms in the event of a ban, said Rob Pearsall, senior vice president of biddable media at ad agency Havas Media, referencing a memo the bureau received from TikTok Friday morning.

US President Donald Trump signed an executive order on Thursday that would ban US trades with TikTok and WeChat, the Chinese-owned messaging app, starting on the 15th of September.

TikTok will be here for many years to come,” Blake Chandlee, TikTok’s vice president for global business solutions, said in a statement.

Some advertisers are forming contingency plans and considering apps to move their advertising budgets.

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Photo-messaging app Snapchat is 1 option for advertisers that will need to reach TikTok’s younger audience, said Meghan Rao, account director at ad agency HYFN, a unit of Nexstar Digital, which counts New Balance and Macy’s as clients.

Contingency planning for a single client that planned to market on TikTok is expected to start on Monday, Rao said. She declined to name the brand.

One form of advertising on TikTok is a challenge, where videos are posted by users about the product of a brand. Since sponsoring a hashtag takes advance planning, Havas and its customers are likely to put a pause on those ads, given that the looming Sept. 15 deadline, Pearsall said.

Brands also have started asking whether they ought to be on TikTok rivals like Triller and Byte, which has seen jump said an ad agency manager who declined to be named.

The team at Platform Executive hope you have enjoyed this news article. Initial reporting via our content partners at Thomson Reuters. Reporting by Sheila Dang. Editing by Kenneth Li and Leslie Adler.

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