Roger Patterson is an EO Vancouver member and the founder and CEO of visual marketing platform Later, and co-founder of accelerator Launch Academy. We asked him about the business case for TikTok. Here's what he shared.
My first impression of TikTok was typical for a Gen Xer: The platform seemed like a hub for tweens to flaunt dance moves and indulge in pre-adolescent narcissism. But after participating in a company hack week where the mission was to build an integration with TikTok, my eyes opened to its possibilities as a serious business tool.
With more than a billion monthly active users globally, TikTok has become the fastest-growing social media platform of the decade--but with 63 percent of its users under the age of 30, executives are quick to disregard it.
And while increased screen time among the under-15 demographic during the pandemic contributed to its growth, the platform is more than short-form dance videos--it's the next generation of content creation.
With its suggestive algorithm, musical navigation and brilliant editing tools, TikTok has mastered compelling, short-form video as a service in a way legacy platforms like YouTube and Instagram have not. The latter may have secured more placement in marketing budgets for now, but TikTok as a legitimate new content channel is forcing brands to re-evaluate how they engage consumers.
If you're a Gen Xer, Boomer or traditionalist doubting TikTok;s business ROI, here are three reasons you should reconsider:
Branded Entertainment Has Become a Must-Have
First and foremost, TikTok is about entertaining its users. Entertainment has become a new form of brand currency, and it's a must-have. Social media influences 71 percent of consumer buying decisions--and that funnel starts with interest and awareness. Millennials and Gen Z in the US alone have a combined $350 billion of buying power, and they're also turning to mobile video as a primary source of entertainment.
Brands need to start thinking of entertainment as a service--a way to add value to consumers first and establish a relationship before moving to transaction.
Importantly, entertaining content doesn't need to exclusively be a frivolous distraction. Done right, TikTok videos can be a gateway to brand education, tying to a brand's mission or higher purpose in more creative and authentic ways.
Early Adopters are Rewarded with Influence
Just as Snapchat graduated from the exchange of ephemeral photos to include video, stories and chat--a formula brands quickly acclimatized to--TikTok is showing signs of breaking out of its Gen-Z niche. The platform just launched a TikTok Resumes pilot program and a new Shopify partnership to support social commerce. Recently, Vimeo integrated with TikTok Business: The first video creation platform to do so.
While the platform's expansion into more mature markets is inevitable, research shows those who get in early have a distinct advantage--higher social status, increased customer loyalty and influence--over competitors who are left playing catch up. Not to mention, building an authentic community on any social platform takes time.
Retail giants including Walmart and Amazon are already diving in head first, securing their position on the platform, as other brands figure out how to embrace the new kid on the social media block. The Washington Post, for example, may not seem a likely brand for TikTok success. However, the legacy publication was an early adopter, turning its news into funny, bite-sized videos that appeal to an entirely different audience than its print or web presence. The reward for its efforts: 40.9 million likes.
Connectivity is the New Word of Mouth
In January, TikTok star Barbara Kristoffersen posted a video of herself wearing a vintage Gap hoodie in brown, a color the retail giant hadn't produced since the 2000s. The post went viral, garnering more than 6 million views. By February, retro Gap hoodies were a common sight on style influencers across all platforms. Just a few months later, Gap was taking preorders for a reissue of the iconic pullover sweatshirt.
The fact is, social connectivity is the new word of mouth. And Gen Z's status as the most socially connected generation of all time can't be ignored. These are the consumers most likely to be talking, sharing and posting about your brand.
Hesitations some have about social media in general, and TikTok in particular, are legitimate. Between privacy issues, concerns about spyware and misinformation bubbles that just can't seem to be popped, the internet can feel like a scary place. But ultimately, at its best, social media allows people to connect around shared interests and businesses to relate to their customers in a more direct way--through conversation, not broadcast.
TikTok may be whimsical and fast-changing, but it's not going anywhere anytime soon. Much like the social media platforms that came before (Facebook started for university students, and is now a key player in the $48 billion social commerce market) TikTok will eventually grow up, expand its demographics and monetize in new ways.
It isn't a question of if TikTok has business potential; it's whether Gen X wants to lead the way in harnessing it, or follow.