TikTok’s US Advertisers Being Prepared By App For A Possible Ban

Following the announcement of a possible ban on TikTok by the United State president Donald Trump within 45 days, the Chinese owned short video sharing app has been preparing its advertisers for the worst situation by offering refunds for campaigns that the app owner was unable to run on the platform, said reports quoting ad buyers.

The advertising business of TikTok is still in its nascent stage.

The app had anticipated annual revenue of $1 billion in 2020 which is but small fraction of the revenues that are typically generated by its Chinese owner ByteDance. But for those brands the aim to reach young tastemakers, the app had become an important medium as millions of youngsters flocked to the platform creating and watching lip-syncing, dancing and comedy sketch videos.

Rob Pearsall, senior vice president of biddable media at ad agency Havas Media, said that the planned ad campaigns will be honored by it, TikTok said, and has also added that it will also refund any money for campaigns that it may not be run. The app has also said that it will help influencers on its platform to migrate to other platforms if a ban is ultimately imposed on it in the US. His comments were based on a memo that had been sent to the agency from TikTok on Friday morning.

An executive order that spelt that the Trump administration would be banning US transactions with TikTok and WeChat from September 15 was signed by Trump on Thursday.

“We’re committed to being a trusted partner to brands, agencies and marketers as we build TikTok for the long term. TikTok will be here for many years to come,” Blake Chandlee, TikTok’s vice president for global business solutions, said in a statement.

Contingency plans such as moving to other platforms according to their marketing budgets re being made by some advertisers.

Meghan Rao, account director at ad agency HYFN, a unit of Nexstar Digital, which has New Balance and Macy’s as clients, said that one of the options for advertisers was the photo-messaging app Snapchat which also has abundance of the same age group of users as that on TikTok.

Without naming, Rao said that one of the clients that planned to advertise on TikTok starting Monday was planning to contingency plans.

A hashtag challenge, where users post videos about a brand’s product, is one of the most popular form of advertising on TikTok. Pearsall said that given the September 14 deadline for the possible ban and since sponsoring a hashtag takes advance planning, therefore Havas and its clients are likely to put a pause on those ads.

According to reports, advertisers and brands are also considering whether they should shift to rivals of TikTok such as Triller and Byte, both of which has sene increased downloads in recent days in the US.

(Adapted from Business-Standard.com)

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