Despite concerns that TikTok could face a ban in the US, advertisers, including Apple, are doubling down and increasing their ad spending on the platform. The video-sharing app saw an 11% growth in advertising in March, despite US officials’ attempts to ban the app over national security concerns.
TikTok’s ad revenue set to surge despite potential ban
According to the Financial Times, Apple is among the top spenders on the platform, alongside other companies such as Pepsi, DoorDash, and Amazon. Even top ad agencies are not advising companies to pull back their advertising efforts just yet, but rather suggesting that companies should continue to advertise while they still can.
However, some experts are advising advertisers to read their contracts with TikTok carefully and consider the cancellation terms before committing to any significant ad spends. While TikTok’s future in the US remains uncertain, advertisers may continue to benefit from the platform’s popularity while taking steps to protect their investments.
TikTok has experienced significant growth in the past year and is expected to reach $14.15 billion in ad revenue by 2023, up from $9.89 billion in 2022. Despite this growth, the app is facing increased scrutiny over data privacy and security in various countries, including the US and the UK.
In early March, US Senators drafted a bill that would allow the Commerce Department to ban the app, but the wording of the bill avoids targeting TikTok directly. Meanwhile, the BBC has advised its staff to delete the app from their work phones due to concerns over data privacy and security.
TikTok CEO Shou Chew has provided a 5,000-word written testimony to the US House Energy and Commerce Committee, arguing that TikTok has brought worldwide exposure to American musicians, artists, chefs, and more. While the platform’s popularity among younger users makes it an attractive advertising platform for many businesses, it remains to be seen how the ongoing scrutiny will impact the app’s long-term viability.
In conclusion, despite concerns over the potential ban of TikTok in the US, advertisers are not yet deterred, and the platform continues to see growth in advertising. However, companies should be cautious and take steps to protect their investments while the app’s future remains uncertain.