C. TikTok
TikTok allows users to share 15-seconds short-form videos. The most common content was and still is dancing or lip-sinking over a trendy music although a more diverse range of contents can be seen nowadays such as sports or politics. For both content creators and viewers, the entry barrier is low. Creation is made easy with ready-to-use music content and a wide array of editing tools. For viewers, moving through clips is easy with simple swipe commands.
TikTok is rather difficult to compare to other popular apps as it shares features with many of them but never fully overlaps. For instance, TikTok is similar to Instagram in the sense that user-created contents are shared, but the content on TikTok is “friendlier” than that of Instagram. The main intention of creators on TikTok is to share funny videos and get more likes while Instagram is probably more “lifestyle and status” oriented. TikTok also shares features with Youtube in the sense that both platforms offer personalized content recommendation based on AI algorithms. But Youtube has more information-sharing videos while TikTok is more fun-based and the length and format of videos are very different. Like Snapshat, TikTok does not give the viewer much choice as to what they will watch and the two apps have similar types of content and curation methods. But Snapchat is more about sharing videos among friends while TikTok is to share content with the general public. While Snapchat posts expire and disappear after 24 hours, one can download and keep forever the contents posted on TikTok.
TikTok has a global user base which is a unique feature for a Chinese app. Surprisingly the largest number of downloads is coming from India, which is responsible for 30% of all downloads, followed by China (10%), and the US (8%). This is a key difference with WeChat – the Tencent messaging platform which also has a huge user base. Before TikTok, there was a big prejudice that Chinese social network platforms couldn’t be internationally used because of the language barrier or cultural differences. TikTok’s instinctive dancing and singing videos broke this barrier showing the universality of some contents. TikTok’s MAU reached 800m in Jan 2020 (of which 440m were from China). It has already surpassed QQ (the instant messaging platform of Tencent) and Weibo (the Chinese equivalent of Twitter). It is slightly less than Instagram’s 1 bn MAU and Wechat’s 1.15bn MAU.
Monetization: TikTok’s Chinese version has developed three monetization methods so far. The first one is coin sales which can be used for tipping the creators of some videos. This is mainly used when creators perform live broadcasting. It is similar to Huya’s or YY’s business models (two other Chinese social media/content sharing apps). The second one is advertising. There are several banners or app-download links shared on screen. The third one is e-commerce. This is a recently developed business model where creators advertise products in their videos and the viewers can buy them from a linked merchandising page which can be either TikTok’s own platform or a third party’s like Taobao (Alibaba) or JD.com .
TikTok’s international platform is not fully monetized yet. There are no e-commerce or creator-tipping function on TikTok’s global version. Advertising is also very limited for the time being. Individual creators can deliver advertising content indirectly, but it doesn’t usually go to ByteDance’s revenue stream. Once this part of the business gets monetized, it will generate a significant revenue and profit jump.
