TikTok Continues Its Meteoric Rise
Written by: Stephanie Bariatti, SMB Media Marketing Consultant
These days, it seems like the sky’s the limit for social media giant, TikTok.
It has quickly become the voice of America’s youth, sparking trends and creating pop culture. According to eMarketer and Insider Intelligence, the Chinese-owned app will have more young users than Instagram at the end of the year. Its impressive rise is even expected to nearly catch up to Snapchat-level popularity in less than five years.
In the past two years, TikTok has seen staggering growth. Given an extra boost by the Covid-19 pandemic, the new-gen social network, specializing in short-form videos, has been winning over more and more users, particularly younger users who we categorize as Gen Z. This new generation of tastemakers is defined as those born between 1997 and 2012. 37.3 million American Gen Z users are expected to be using TikTok at least once a month this year.
“TikTok has incredibly strong engagement and loyalty among Gen Z. The members of this generation are using it not only to be entertained, but also increasingly to learn about and discuss weightier issues such as climate change, politics, and news,” said Debra Aho Williamson, eMarketer principal analyst at Insider Intelligence. “Other social platforms also offer such content, but TikTok’s unique video style and aesthetic is strongly appealing to young people.”
Though it performs exceedingly well with the younger set, TikTok is also gaining ground with older Americans as well. By 2023, TikTok should be on par with Snapchat. Instagram, however, still maintains a healthy lead over the other two platforms among US mobile social users of all ages. Yet, TikTok shows the largest percentage of growth between the time period of 2020-2023.
However, the future hasn’t always been so rosy for TikTok. Last year saw a turn of tumultuous events that nearly threatened to take down the company’s US presence.
It all began in November of 2019 when Congress held a hearing about China and its presence within the tech industry. At the session, Missouri Senator Josh Hawley specifically singled out TikTok, claiming Chinese tech platforms’ entry into the U.S. market was potentially dangerous, as US user data could be shared with China. Around the same time, the Committee on Foreign Investment in the United States, which oversees transactions between American businesses and foreign ones, said it would review ByteDance’s acquisition of Musical.ly (TikTok's former incarnation)amid concerns the Chinese company might share user data with the Chinese government.
TikTok denied sharing any data, but tried to repair their image by hiring CEO Kevin Mayer, a former Disney executive who had helped orchestrate Disney’s most significant acquisitions. Mayer’s tenure turned out to be short-lived, but around the same time, TikTok’s parent company, ByteDance, bulked up its lobbying presence in Washington, DC, spending $2.6 million last year, a nearly 10-fold increase from 2019, according to the Center for Responsive Politics. It also began entering into conversations with Microsoft, broadly discussing a deal where the tech giant would take a minority stake and possibly help TikTok store user data in America.
But things turned south quickly in June 2020, when a movement started on TikTok resulted in an embarrassingly low turnout for a Trump rally in Tulsa, Oklahoma. Anti-Trump users had organized an effort to register for tickets without any intention of going.
Within weeks, President Trump told reporters he intended to ban TikTok, with his administration citing national security concerns. However, after speaking with Microsoft, he gave them the greenlight to pursue a deal with TikTok. Trump gave Microsoft a 45-day deadline to finish the transaction, in which the software giant would buyTikTok’s operations in the US, Canada, Australia and New Zealand and ensure the app stored Americans’ user data in the US. To further pressure TikTok into a quick sale, he issued two executive orders to force the app out of America if it didn’t sell.
The first order sought to prevent any more downloads of TikTok in the U.S. if the company didn’t sell by mid-September, the second would ban it outright if it hadn’t completed the matter later in the fall. Both would be challenged in federal court.
Fast-forward to mid-September. The deal with Microsoft didn’t work out, but TikTok instead decided to make a deal with Oracle and Walmart. Around the same time, it won its case against Trump’s first executive order, receiving an injunction that stopped the download ban. A second court victory followed in October, which blocked the president’s second executive order to ban the app entirely. By the time the election was over and Biden was declared the new president, the threat of TikTok’s US demise seemed to die down altogether.
As a result, the Walmart-Oracle deal still has not been completed and remains in limbo. Between vaccines and the economy, it seems unlikely that the fate of an app so popular with young voters would be at the top of Biden’s list of priorities. So it remains unclear if that deal will ever be finalized.
However, Republicans still concerned with TikTok’s connections to China reintroduced legislation in early April that would prohibit it from being installed on government devices. Leading the charge once again was Senator Hawley, pushing once more to make the bill a reality after his previous effort fell short. The bill, if signed into law, would essentially prohibit downloading or using TikTok and other apps and services made by Chinese developer ByteDance Limited on any device issued by the U.S. government.
Companies in the People’s Republic of China are required by law to share data with authorities when asked, effectively allowing its government to access information TikTok collects on hundreds of millions of users worldwide. Senator Hawley and his co-sponsors assert the app then poses risks that require it be reined in for the sake of national security. “TikTok is a Trojan horse for the Chinese Communist Party that has no place on government devices–or any American devices, for that matter,” Hawley asserted in a statement announcing his new bill. TikTok believes these concerns to be “unfounded.”
On April 30, ByteDance sent a strong signal it doesn’t see much to fear currently, by selecting the new TikTok CEO, Shouzi Chew, from within the Chinese parent company. It’s hard to imagine ByteDance making such a choice—a non-American executive—if it thought Biden was likely to adopt the same stance as Trump.
ByteDance boss, Zhang Yiming, sees great promise in Chew. He is a Harvard-educated Singaporean executive who is fluent in English and Chinese and deft at navigating both cultures, says one executive who worked closely with him in China. He has a tough job ahead of him. Chew must contend with his the governments of two world superpowers and an onslaught of competition from other social media companies, but the higher-ups believe he is capable of building trust and productive relationships on a global scale.
The next few years should prove promising for TikTok if it can continue to innovate, avoid political challenges and continue to gain followers. However, social media is continuously evolving and other young startups are eager to throw their hat into the ring. You never know when the next TikTok-like phenomenon will come along, but this TikTok is sure to keep its foothold for the time being.
Stephanie Bariatti works as a Consultant and Project Manager for SMB Media Consulting. She has had extensive experience with many facets of advertising and media, having worked for and with creative agencies, production companies and research departments. She lives in New York with her wonderful husband, three lovable little boys and a snuggly Golden Retriever.
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