TikTok saw an 11% increase in advertising during March, despite a growing controversy that may lead US officials to ban the short video social media app due to national security concerns. As reported by Financial Times, Apple is among the top spenders, along with Pepsi, DoorDash, and Amazon.
Brands show no sign of pulling back on ad spending on Chinese-owned TikTok and advertising agencies, including WPP’s GroupM and Omnicom, have not advised clients to cut down on their ad spending on the platform, say several ad executives and agency leaders.
A survey by software group Capterra of 300 US marketers found that 75% of survey respondents planned to increase spending on TikTok over the next year.
However, some brands are making contingency plans in preparation for a possible U.S. ban. They are making plans to move their ad spending to other platforms, such as those owned by Google and Meta.
In March, TikTok’s chief executive faced questioning from US legislators over national security fears linked to the social app’s Chinese ownership. Beijing has said it would “firmly” oppose any move to divide TikTok’s US arm and its Chinese overlords. Part of the Chinese government’s campaign against any changes in TikTok ownership includes a social media campaign mocking US government concerns about the app, going so far as to accuse Congress of hypocrisy, xenophobia, and technical illiteracy.
There are several valid concerns over Chinese ownership of TikTok, as the Chinese government has a strong influence in the country’s tech sector. Many fear that the Chinese government could control which videos would be shown to American users, possibly being used for propaganda.
These fears have led to a US ban on the app being installed and used on government devices, a call from the Federal Communications Commission to remove TikTok from the Apple and Google app stores, and the US military and over half of U.S. states to enact their own bans.
The Biden administration has also urged Congress to pass an act giving the president the power to ban apps like TikTok when they are considered to be a risk to national security. Australia recently banned the TikTok app from official devices, and the UK has fined the developer for violating privacy laws.
As reported by 9to5Mac, the non-partisan group Alliance for Securing Democracy monitored social media posts by Chinese state media and diplomats, finding a massive increase in posts related to TikTok, many of which had an aggressive tone.
Chinese diplomats and state media made more than 200 tweets about TikTok between March 20 and March 26, 2023. Those same accounts made fewer than 150 mentions of the company during January and February 2023. A noticeable spike in tweet activity came immediately following the March hearing, with those accounts mentioning the short video social platform over 75 times on March 24 alone.
The posts revolved around familiar propaganda themes, appealing to xenophobia, talking down the U.S. system of government, claiming the U.S. is undemocratic, paranoid, and hostile to Chinese businesses. The posts also sought to highlight China’s opposition to a sale of the platform, while also trying to increase TikTok users’ opposition to a U.S. ban on the app.
Advertising makes up the lion’s share of TikTok’s $10 billion in global revenues, and the company has fought for ad market share from competitors by offering lower ad rates, say industry insiders. TikTok is forecast by research group Insider Intelligence to bring in $14.15 billion in revenues in 2023, a nice increase from the $9.89 billion it brought in during 2022.
