Every youth generation has its own styles and attributes that affect greater society, and in recent decades those styles have been driven by technology trends. Generation X helped make email and the World Wide Web popular and more accessible, while Millennials played a role in bringing the smartphone and social media into the mainstream. Today, Generation Z, or the “Zoomers” as they are often called, are doing their part in driving tech trends by making the social media app TikTok a ubiquitous part of society. During all of those previous tech-trends, forward thinking brands were there to take advantage, and how brands react to the rise of TikTok, particularly how it relates to younger consumers, may play a key role in the retail landscape in the coming years.
Chances are you’ve probably heard about TikTok, but if you’re over the age of 40 you may know little about it. TikTok is a short-form video hosting service that allows users to upload homemade videos to their accounts that are then made public for other TikTok users to see. TikTok is sometimes considered a social media platform, but it differs drastically from standard platforms such as Facebook and Twitter in its form and purpose – video trumps written text on TikTok.
The users of TikTok also have a different profile than those who use the other social media platforms. Facebook has increasingly become social media for older people, while Twitter is becoming the domain of middle-age Millennials and Gen Xers, but TikTok is by far the most youth driven of all social media platforms: 41% of its users are ages 16 to 24.
The numbers present a plethora of opportunities for brands to harness the buying power of the younger generation. And despite some talk in Washington and various state capitals of banning TikTok, it only appears to be gaining more momentum as a cultural force. So let’s examine how TikTok rose to prominence, why young consumers like it, how brands can take advantage of this trend, and what advantages consumers can expect in the future.
From Social Media to TikTok
Although TikTok isn’t considered a true social media platform by some experts, it wouldn’t have been possible without the rise in popularity of social media. The explosion of social media platforms took place in the early to mid-2000s, when the internet became more affordable and accessible to a greater part of the population, but the idea was born much earlier.
The first online social communities began in the 1980s, when the vast majority of the people on the earliest forms of the internet, such as ARPANET, were techies, academics, and government employees. These early net denizens formed bulletin board systems (BBS), which offered message boards and chatrooms where liked minded people could meet. Social media remained relegated to the technology fringes for most of the ‘80s until the World Wide Web was invented in 1989.
After computer scientist Tom Berners-Lee invented the World Wide Web and released it to the public in 1991, it changed nearly every aspect of our world, including how people form social groups. As access to and popularity of the internet grew in the 1990s, tech entrepreneurs began taking advantage of the new paradigm of social networking.
Classmates.com went online in 1995, becoming one of the first successful social media platforms, but it would be a few more years before the technology, as well as people’s attitudes, caught up to the idea. The social media explosion began in 2003 when Myspace went online, followed by Facebook in 2004, YouTube in 2005, and Twitter in 2006. This wave of social media platforms set the table for TikTok to take the next generation by storm.
The engineers at Chinese company ByteDance saw what worked and what didn’t with the early social media platforms and released Douyin in September 2016 to the Chinese population. Douyin was an immediate hit with younger people, as it straddled the line between social media and content creation. ByteDance executives knew they were on to something big, so the international version of Douyin, TikTok, was launched in 2017 and later merged with the Chinese social media app, Musical.ly.
TikTok Takes Off
TikTok was released to relatively little fanfare and its early user numbers indicate that its success was never assured. The app only had 55 million users in 2018, but that number exponentially increased to one billion in the summer of 2021. The pandemic certainly played a role in TikTok’s widespread adoption, but it had been downloaded 693 million times in 2019 and 850 million times in 2020, indicating that it was taking off before the lockdowns. Further numbers show how TikTok has quickly disrupted the social media space.
American technology company, Cloudfare, ranked TikTok as the most popular website of 2021, and in 2022 TikTok reached nearly 1.5 billion users. TikTok also reported revenue of $9.4 billion in 2022, which was almost double from the previous year. So, TikTok is clearly on the rise and has disrupted the social media space, but not everyone is happy with the situation, which could affect the its trajectory as well as brands associated with it.
Most of the organized resistance to TikTok has come from governments. The Pakistani government banned TikTok in 2019, which was followed by its rival neighbor, India, banning the app in 2020. India’s TikTok ban was challenged in the courts but upheld in 2021.
In the United States, TikTok has been targeted by Republicans at the federal and state levels, who argue that it is used by the Chinese Communist Party to collect information on American citizens, but to date there have been no major anti-TikTok legislation initiated and it remains among the most popular social media platforms in the world.
So, in the face of sometimes intense government pressure, the obvious question is: why has TikTok become so popular so quickly? The answer is multi-tiered, yet somewhat simple much like the app. TikTok posts are quick, flashy, and catchy, which has become a hallmark of Generation Z, and there is plenty of money that can be made on the app by popular influencers.
Influencers who produce popular content and have the ability to manipulate the algorithms by putting their content at the top of users’ suggestions have found immense success on the platform, which brings us to how brands can use TikTok to connect with their consumers.
Brands, Consumers, and TikTok
TikTok’s surge can create plenty of opportunities for companies that are willing to understand this unique social platform and its users, which in turn will give more chances for consumers to learn about specific brands. The TikTok algorithm is more user friendly than many other social media platforms, with its “For You” page (FYP) bringing users videos similar to those they’ve watched or liked, as with YouTube.
And also similar to YouTube, brands can utilize this by creating content in the form of short, catchy video clips that explain their products, sometimes using notable influencers to showcase products. This is a specific form of omnichannel marketing that will likely become even more popular in the future.
It should also be noted that in this early stage of TikTok marketing, the brands that do the best on the platform are those that align with TikTok’s do-it-yourself style. There is very little traditional advertising done on Tiktok, with the majority coming from the brands and their content creators.
TikTok also has the “creator fund,” which is a multi-billion dollar program whereby funds are distributed among creators based on the number of clicks they receive, providing further incentive for brands to stay true to TikTok’s youth orientated culture. As TikTok grows in popularity, there are a few notable brands that have successfully used the platform.
Although it’s still too early to quantify how well brands have used TikTok, there are a few companies that are leading the way with their attempts to connect to consumers via the platform. Coffee and donut restaurant chain, Dunkin’, recently entered into a partnership with TikTok influencer, Charli D’Amelio. After content about the partnership was first posted, Dunkin’ enjoyed a 57% increase in mobile app downloads and a 20% increase of cold brew coffees.
Fast food chain Chipotle has also experienced the benefits of using TikTok. TikTok users have responded well to Chipotle’s dance challenges and behind the scenes content with employees, while shoe company Crocs has kindled interest in its product among younger people by publishing content of users wearing their shoes doing scripted dance moves. All of these brands have demonstrated the ability to capture consumers’ attention by presenting their products in a lighthearted, fun way that appeals to young TikTok users.
TikTok and the Future
There’s no doubt that TikTok presents many new opportunities for brands to connect with younger consumers, and importantly, the potential is still quite far from being fully realized. Because TikTok is a new platform that uses new technology, there are many ways for brands to harness its power. As Generation Z begins to enter young adulthood and demonstrates its buying power, brands that understand this potential – and how much young people like TikTok – will benefit from this new social media and retail paradigm.