Last night in an unprecedented move, President Trump issued an executive order banning TikTok and sister app WeChat in the United States if the Chinese-owned company is not sold in the next 45 days. This marks another huge hit for TikTok, which has become so popular with teens and young adults. The President’s order highlights the app’s security risks, as outlined in our earlier post, as the primary reasons behind the ban.
At almost the same time, Facebook-owned Instagram launched Reels, a new feature that offers similar functionality aimed squarely at TikTok’s Gen Z audience. This release is not Facebook’s first attempt to contend with popular features from competitors. Instagram Stories directly rivaled Snapchat’s stories feature, effectively slowing Snapchat’s user growth after its initially strong release.
What does this mean?
If the apps aren’t sold by the end of the 45-day period, the executive order prohibits “any transaction by any person, or with respect to any property, subject to the jurisdiction of the United States, with ByteDance Ltd.,” the Chinese company that owns the social media platform.
In other words, paid and organic advertising, which would be considered transactions under this order, would be barred for U.S. companies if the apps are not sold.
What should marketers be doing?
Microsoft is currently in advanced talks to purchase TikTok from ByteDance Ltd. But until a deal is reached, marketers should consider proceeding with caution and have a back-up plan to reach this core audience. And brands should be prepared to pause any existing campaigns on the app – or risk prosecution – if the app isn’t sold within the 45-day window.
Even before the addition of Reels, many TikTokers had begun migrating to Instagram both in response to a potential ban and to diversify their social media presence. Reels’ functionality may accelerate the migration, but brands shouldn’t expect Instagram to fully replace TikTok’s reach just yet. Instagram’s core demographic of adults 25-49 has already embraced the Reels feature, with users expressing their excitement over the new rollout. But it will take time for Reels to build affinity among adults in TikTok’s core 16-24 age group.
YouTube is another great option, as it remains one of the strongest platforms to reach teens and young adults. Brands that depend on this demographic may want to begin building their YouTube advertising and content strategies now in case a pivot is needed.
The TikTok audience is in mourning with the news and many users are posting farewells and tributes to the beloved app. We all hope TikTok perseveres during the next 45 days and beyond so we don’t have to say goodbye.
July 24, 2020: Brands Must Weigh Dangers of Embattled App TikTok
Marketers may want to distance their brands from the beloved app, due to recent controversy around data-related security risks.
May 1, 2020: Understanding Customers is Crucial Amid COVID Chaos
It’s time to sharpen and optimize the tools you use for customer-first marketing – here’s where to start.
March 30, 2020: Media Mix Modeling in the Age of COVID-19
With shifting consumer trends, businesses should consider reallocating ad dollars.
Has your brand seen success with the TikTok audience? We can help you consider smart pivots to other channels.