Opinion: TikTok still has a future after potential acquisition

As TikTok's future remains uncertain, ad buyers have been cautious about leveraging the video-sharing platform. We have invited Humphrey Ho, managing director of Hylink in the US to examine this topic.

Ad buyers' reaction to the TikTok issue

Any kind of uncertainty creates advertiser apprehension. The issue for TikTok is one where user data might be deleted as well as competitive products already in place such as Instagram Reels and Triller. This forces advertisers to look whether their autumn and holiday campaigns, in planning currently, are potentially at risk. Therefore we are seeing advertiser attrition to plan new campaigns on TikTok.

Top influencer migrations have already begun to occur with some degree of success in beauty fashion and tech, so that presents a longer-term threat. This is especially true with Facebook, and other organisations, actively recruiting top influencers, presenting a longer-term challenge to brands finding TikTok's user base smaller, or fewer top influencers to collaborate with.

From an ad buyer's standpoint, TikTok's user base has always leaned to the younger side, with monetisation potential being less attractive than broader user bases such as IG or other short-video competitors. What is unfortunate here is brand reach amongst challenger brands, who still spend dollars on branding rather than more mature brands who are focusing on performance sales conversion.

TikTok is not yet dead, and not yet out. Ad buyers are the first to react. If the acquisition completes with a suitor, we think that ad buyers will continue to recommend TikTok.

How the TikTok issue affects brands’ media buying strategy?

Brands are planning for Black Friday, and Christmas. This high level of uncertainty moving into November is causing apprehension among advertisers to continue to invest unless there is clarity on a buyer or if the executive order to delete all US information is stayed. Current campaigns seem to be ongoing.

Brand's media buying strategies are definitely a wait and see right now. Many brands have shifted to a direct-to-consumer performance model, so Instagram Stores and the tight integration with Reels definitely presents a unique advantage over TikTok.

This article is contributed by Humphrey Ho, managing director of Hylink in the US.