TikTok: The Clock Ticks for the World’s most Valuable Startup

Growth can happen fast. TikTok was launched in 2017 as a video social networking app for markets outside of Asia, and in November 2019 the app was one of the most downloaded in the world with more than 1.5 billion downloads in the Apple App Store and Google Play. Now, the company behind TikTok – the world’s most valuable startup – is testing new ways to monetize.

TikTok has not only become one of world’s fastest-growing apps – it’s a global phenomenon that take entertainment in micro doses with “a vast global collection of 15-second clips that are changing the way we sing, dance, pose, joke, collaborate and cook”, as the New York Times describes it. They also report that in November 2019, TikTok has been downloaded more than 750 million times over the past 12 months. According to the research firm Sensor Tower this is more than Facebook, Instagram, YouTube and Snapchat.

Creative or Commercial?
TikTok has been known as a “creative“ place very different from Instragram’s picture perfect and highly commercial universe. The question is if that will now change?

It was not until January 2019 that TikTok started testing eCommerce capabilities with paid-for shopable video ads from major brands, that was rolled out a few months later. And then 10 month later the founder of the Chinese influencer agency Uplab, Fabian Bern, shared a Twitter post showing off a short-form video featuring a pint-sized puppy influencer on TikTok in a handmade panda costume. If a TikTok’er wanted to buy one of those costumes for themselves, they could just click on the video and be taken directly to the creator’s store without leaving the TikTok app.

This is all still a beta test for a social commerce functionality with a select group of top-performing US influencers. But if this feature is rolled out to all users, influencers will be given the ability to use social commerce URLs in their videos, a feature TikTok calls ‘shopping cart.’ This offering could allow any TikTok’er in the world to turn the platform into a shop for his or her own online store.

But it’s not all new. A similar feature has been live on TikTok’s Chinese counterpart, Douyin, since early 2018. Douyin was launched also by ByteDance – but for the China market – in September 2016. This means that TikTok and Douyin are basically the same but run on different servers to comply with Chinese censorship restrictions.

US critique
During the 2019 growth US politicians have been sharply critical of the company over concerns with how it handles user data, and in 2019 TikTok was fined under the American privacy law COPPA for disturbing practices toward children. It has also been criticised for its alleged censorship of political content related to the ongoing Hong Kong protests, but so far TikTok have denied to be censoring content on behalf of Beijing. But there is more. In the beginning of November TikTok confirmed that it would not send a representative to testify before a US Senate panel meant to examine the tech industry’s ties to the Chinese government.

What’s next?
Considering the wild growth TikTok doesn’t seem to be suffering under the US allegations. Right now the battle is more than anything a battle on the ad market. It is unclear whether or not the beta test will result in a full global roll-out, or when. Moreover, if the feature is being rolled out, the questions still remains what it will mean for the app’s brand very well described by the TV Critic James Poniewozic in The New York Times: “The more time I spent with the app, the more I realized that any feeling of exclusion I had was my own baggage. The pervasive feeling I got from TikTok was inclusion. It wasn’t, like Instagram, trying to persuade me of its ‘users’ happiness, or, like Twitter, of their rightsness. Instead the vibe is: Look at this cool thing I did. What can you do”?

Let’s see what the battle between US government and ByteDance brings. Let’s see what that can actually do.

Mie Oehlenschläger is a regular contributor to DataEthics.eu

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