TikTok, the short-form video platform owned by ByteDance, has taken the global digital media landscape by storm, becoming one of the most influential platforms in recent years. Known for its ability to captivate younger audiences and drive cultural trends, TikTok has positioned itself as a leader in creative and interactive advertising. However, the platform operates under a cloud of regulatory scrutiny and geopolitical tensions that threaten its viability in the United States, raising questions about its long-term future. Despite these challenges, The Myers Report's latest survey of advertising professionals reveals that TikTok continues to perform solidly in many key categories, with little evidence of a significant advertiser backlash, unlike the turbulence confronting X (formerly Twitter). The Myers Report analyses on additional media companies are available at www.myersreports.com. The full The Myers Report survey assessed perceptions of 50 media companies across several categories. Subscribers to The Myers Report receive proprietary presentations. Scroll down for methodology and details.
TikTok’s Performance in the Advertising Landscape
According to The Myers Report, TikTok ranks well in several critical advertising metrics:
- Sponsorships and Creative Opportunities: TikTok scores 118, ranking second in this category among seven digital/social platforms evaluated. Its ad formats, such as branded hashtag challenges and augmented reality (AR) filters, have become staples for advertisers seeking creative, interactive campaigns. This high score reflects TikTok’s ability to engage users in innovative ways, allowing brands to tap into viral trends and drive organic participation.
- Audience Reach: With an index of 117 and a third-place ranking, TikTok demonstrates its ability to deliver a broad audience, particularly among Gen Z and Millennial demographics. Its algorithm ensures high engagement by curating personalized content that keeps users on the platform longer than most competitors.
- Sales Organization Attentiveness: Scoring 101 and ranking fifth, TikTok’s sales organization performs slightly above average. However, there is room for improvement in cultivating stronger relationships with advertisers and delivering a higher standard of client service. Among the 50 media sales organizations evaluated in The Myers Report, Pinterest ranked first for attentiveness and service, setting the standard for digital/social media.
- Cost Efficiency: TikTok ranks third in this category and third among all 50 measured media publishers, underscoring its appeal as a very cost-effective advertising option competitive with Meta and YouTube, which rank as the most cost-efficient media options for advertisers.
- Brand Safety: TikTok scores an 82, ranking fifth in the digital/social category. While this indicates that advertisers perceive some risk regarding content adjacency and user-generated content, the score does not suggest widespread concern as compared to X, which indexes at 47.
These scores highlight TikTok’s competitive position in the advertising market. Its creative offerings and broad reach make it a compelling choice for advertisers seeking innovative campaigns targeting younger, highly engaged audiences.
Regulatory Challenges in the U.S.
Despite its advertising success, TikTok faces significant regulatory hurdles in the United States. Concerns about data privacy, national security, and content moderation have put the platform under intense scrutiny. Lawmakers and regulators have raised alarms over TikTok’s ties to its Chinese parent company, ByteDance, with fears that user data could be accessed by the Chinese government. These concerns have led to:
- State-Level Bans: Several U.S. states have banned TikTok on government devices, reflecting bipartisan concerns about its potential misuse.
- Federal Legislation: Congress has introduced bills seeking to limit or outright ban TikTok in the U.S. unless ByteDance divests ownership. The proposed Restrict Act and other initiatives underscore the growing tension between the platform and U.S. policymakers.
- Committee on Foreign Investment in the United States (CFIUS) Review: TikTok is under investigation by CFIUS, which has the authority to recommend a forced divestiture of TikTok from ByteDance.
These challenges raise questions about TikTok’s long-term viability in the U.S. market. A forced divestiture or an outright ban would not only disrupt its operations but also leave advertisers scrambling for alternative platforms to reach its valuable audience base.
Advertiser Sentiment and the Contrast with X
Interestingly, The Myers Report’s data reveals no significant backlash among advertisers toward TikTok, even amid its regulatory challenges. This stands in stark contrast to the struggles faced by X, which has seen advertisers flee due to concerns about content moderation and brand safety. TikTok’s score of 82 in brand safety, while below average, does not reflect a widespread crisis of confidence. Advertisers appear to view the platform’s risks as manageable, particularly given its strong ROI and cultural relevance.
This relative stability suggests that TikTok has successfully mitigated advertiser concerns, perhaps by emphasizing its investments in content moderation and partnerships with third-party safety organizations. Its ability to maintain trust among advertisers, despite geopolitical headwinds, underscores the platform’s resilience and strategic importance in the digital advertising ecosystem.
The Road Ahead: Opportunities and Risks
To maintain its position, TikTok must address its regulatory challenges head-on while continuing to build trust with advertisers. Key areas of focus should include:
- Strengthening Content Moderation: By investing further in AI-driven content moderation and human review, TikTok can enhance its brand safety score and reassure advertisers about the risks of user-generated content.
- Improving Transparency: Proactively engaging with U.S. lawmakers and regulators, while increasing transparency around data practices, could mitigate concerns about its ties to ByteDance.
- Expanding Advertiser Support: Enhancing the attentiveness of its sales organization, which currently ranks fifth, could help TikTok strengthen relationships with brands and agencies.
TikTok’s ability to navigate regulatory scrutiny while maintaining strong performance metrics is a testament to its value proposition as an advertising platform. The Myers Report’s findings demonstrate that advertisers continue to prioritize TikTok for its innovative ad formats, broad audience reach, and cultural relevance. However, the platform’s future in the U.S. market depends on its ability to address data privacy and national security concerns, as well as improve its brand safety perception.
While TikTok’s regulatory hurdles remain a significant risk, its resilience and continued advertiser support indicate that it remains a formidable player in the digital media landscape. Advertisers and industry stakeholders would be wise to monitor developments closely, as the platform’s trajectory could have far-reaching implications for the broader advertising ecosystem. For Wall Street analysts, TikTok’s continued growth and advertiser loyalty suggest opportunities, but the regulatory risks cannot be overlooked.
Introduction to The Myers Report Survey and Methodology
The 2024 Survey of Advertiser and Agency Planners, Buyers, and Influencers, conducted by The Myers Report, serves as a vital benchmarking tool for evaluating the perceptions of media companies and their sales organizations. This comprehensive survey provides actionable insights into how leading advertising-supported streaming video platforms are performing in delivering value and meeting the needs of their advertising partners. Visit www.MyersReports.com for additional reports and company analyses.
Purpose of the Survey
The Myers Report survey aims to:
- Assess Media Company Value: Evaluate how well media organizations align with advertiser and agency priorities, including cost efficiency, audience targeting, brand safety, and overall value.
- Benchmark Sales Organization Performance: Highlight how effectively media companies' sales teams deliver client service, communicate value, and support advertisers' needs.
- Inform Strategic Decision-Making: Provide advertisers and agencies with data-driven insights to optimize media planning and buying decisions.
Promote Industry Excellence: Highlight high-performing organizations, setting benchmarks for best practices and excellence in the rapidly evolving advertising landscape.
Survey Scope and Methodology
The Myers Report survey represents input from 550 respondents in October 2024, including advertisers, planners, buyers, and influencers, and was conducted in collaboration with the Association of National Advertisers (ANA), the 4A’s, and leading media agencies. The study focuses on 50 media companies including 13 broadcast and cable media companies, 16 advertising-supported streaming video platforms,seven digital/social platforms, four out-of-home media sellers, and five MVPD distributors. evaluating their performance across seven key categories, including cost efficiency, audience reach, brand safety, and client service.
Role of The Myers Report
For over three decades, The Myers Report has been a trusted source of intelligence for the advertising and media industry, delivering in-depth research and insights. This survey is an extension of that legacy, providing advertisers and media professionals with a clear understanding of competitive performance and opportunities for collaboration and growth.
Through its findings, The Myers Report empowers decision-makers with the knowledge to navigate the dynamic media ecosystem and drive greater value in their partnerships with media companies. For more information contactjack@mediavillage.org.