Ad experts claimed TikTok’s appeal to consumers would keep advertisers spending despite U.S. national security worries.
TikTok, owned by Chinese tech giant ByteDance, is battling a U.S. ban after senators sponsored a measure that would give President Joe Biden’s administration the power to prohibit security-risk applications. Multiple governments have banned the short-form video app from government-issued phones.
As part of NewFronts, a week of social media and streaming video platform presentations for marketers, TikTok will give an advertising presentation on Thursday evening in New York.
According to Insider Intelligence, TikTok’s ad sales would expand 36% to $6.83 billion this year despite worries about its Chinese ownership. “None of our clients are saying ‘don’t spend money on TikTok,'” said Influential CEO Ryan Detert. “There’s no contagion that we’re seeing,” he continued. For example, Pepsi and the NFL are Influential clients.
Two big ad agencies’ media buyers told Reuters that Washington’s examination of TikTok had not affected their customers’ plans. Two buyers discussed TikTok connections anonymously.
On Thursday, TikTok will unveil a new ad model that lets companies display advertisements next to content like BuzzFeed, Dotdash Meredith, and NBCUniversal, giving those publishers 50% of the ad income.
“TikTok is irreplaceable unless and until (advertisers) have to replace it,” said Mark DiMassimo, founder of creative agency DiMassimo Goldstein, which works with Hello Fresh and Samsung.
During advertiser presentations, several media buyers noted the “elephant in the room” of a U.S. ban. On Tuesday, TikTok announced that its head of U.S. trust and safety would leave the firm next week, leaving the app without a senior executive who managed content moderation and safety measures for its U.S. user data division.
“There’s a lot of uncertainty combined with uncertainty in general about the economic situation,” said Stephani Estes, chief media officer of digital marketing agency Goodway Group. “You have to consider the what-ifs.” TikTok addresses advertising concerns “head on in an open, fact-based and ongoing dialogue.”