TikTok is one of the most popular and trend-influencing forces, which means that TikTok promotions can help to build your brand, and drive sales benefits.
When done right.
Tapping into the right tone for the app can be challenging, and it’s not for all brands. But for those looking to reach a younger, web-savvy audience, it can be a powerful sales driver, both in the short and long term.
Which is what this new study digs into.
TikTok recently commissioned Dentsu to undertake a marketing mix modeling study of 15 brands in the app, in order to analyze the ROI that each generated from their ads, and the speed of response to each.
In terms of short-term sales effects, Dentsu analyzed resulting sales within the first 6 weeks of each campaign, while longer-term impacts were measured over a period of 10 months.
So we’re looking at immediate action and response based on campaigns, versus the ongoing value of running TikTok ads.
And the findings are worthy of note:
“With an average short-term ROI of 11.8, TikTok ranks among the most effective media channels for generating revenue. The findings showed that 75% of advertisers achieved the highest ROI on TikTok compared to other media channels, and the platform’s impact extended beyond the campaign period, with sales effects persisting for three to four weeks post-exposure.”
Indeed, the data also shows that 7 out of 15 brands studied saw significant long-term ROI, which led the researchers to conclude that most brands are underinvesting in TikTok ads.
Which, given it’s a TikTok-commissioned report, isn’t overly surprising, as it’s unlikely to be promoting a report that casts its ad tools in a negative light.
But the evidence here is interesting.
First, the report essentially notes that while TikTok is valuable for short-term promotions, ongoing investment in building your brand delivers steady long-term benefit.
“Brands that engaged with their audiences consistently saw sustained sales growth over time. Rather than relying on sporadic campaign bursts, advertisers who maintained a steady presence on TikTok increased brand familiarity and recall, ensuring they remained top of mind when consumers were ready to make a purchase. “
Again, it’s probably no surprise that investing over the longer term drives branding benefit. But it is worth noting the comparative long and short-term performance of the app.
As you can see, in the longer term, the data does show that several ad platforms deliver better results than TikTok, but none beat it in short-term response.
But expanding those quick-hit campaigns into longer-lasting branding efforts can deliver better results in combination, which is an interesting note.
Essentially, if you’re going to use TikTok ads, you may as well glean the longer-term benefits as well, if you can.
Of course, you would also need to weigh up the creative spend against this in order to determine your own ROI in each case, and it could be that investing in TikTok creative, for your business, ends up outweighing those long term gains. But if you can repurpose your campaigns over a longer period, that too could glean more significant benefits.
Either way, the data here is interesting, and could provide more to consider in your planning.
You can check out Dentsu’s full marketing mix modeling study of TikTok campaigns (10 pages) here.
