TikTok’s Creators Worry Monetization Will Give With One Hand and Take With Another

While they need money to survive, TikTokers also worry that transactions will compromise their standing with their fans

Abby Arora
Sep 30, 2019 · 4 min read
Image: Chris Stokel-Walker/Wikimedia

TikTok and its users are skyrocketing in popularity. Take Sarah Lugor, a university student, who has 716,500 followers and 23.7 million likes. She goes by Shreksdumpster, and her videos feel goofy, personal, and warm — as if you’re a close friend.

“Shreksdumpster was a really dumb joke with my friends, but that’s when my account blew up. So now that’s how everyone on the app knows me,” she explains. It’s this sort of nonchalant, unaffected attitude that makes going viral on TikTok feel organic.

“I began TikTok because it looked fun, and I found I could use it as a creative outlet,” Lugor says. “My videos began to gain traction around February, but I really found an audience around June.” She was surprised about going viral — “I don’t really think it’s fully set in that I have a following.”

Since TikTok’s inception in August 2018, when the app subsumed the now-deceased app Musical.ly, it has grown astonishingly quickly. TikTok was the most downloaded social media app last month, adding nearly 63 million new users globally across the App Store and Google Play, according to app monitoring firm SensorTower. First-time downloads of TikTok grew 29% year-over-year for the first half of 2019, compared to YouTube’s growth of 8%.

ByteDance, the Chinese company that owns TikTok, is showing no signs of slowing down — despite controversy around content censorship. It has been trying to speed up monetization in overseas markets as competition within China’s content market becomes even more fierce. ByteDance earned at least $7 billion in revenue in the first six months of 2019, and has launched two video ad-creation tools, with one specifically for ads on TikTok.

The direction of travel is clear: TikTok is being primed for monetization, and as any business major can tell you, companies like to follow the money. The NFL recently announced a multi-year partnership with TikTok in an effort to reach a younger audience, and they’re not alone. Ralph Lauren ran a hashtag challenge campaign around the U.S Open, and Macy’s also ran a back to school hashtag challenge campaign. TikTok circulates to several partners a weekly list of upcoming hashtag challenges it plans to promote on the app, giving companies the chance to capitalize on the app’s viral success.

Nico Cary, chief operating officer of influencer marketing company Influentially, is convinced that TikTok is the key for companies that are looking to target younger audiences. “TikTok is the platform for Generation Z. There’s no doubt about it. For brands to get the real bang for their buck, they are going to use TikTok,” he says.

But commerce is a double-edged sword: the ads feel jarring on the platform because, up until recently, TikTok has escaped one thing Gen Z seems to hate: the ultra-curated Instagram aesthetic.

“What holds me back from a lot of financial opportunities is my fear of disconnecting from my audience”

TikTokers largely possess a self-deprecating quality that makes it alarmingly easy to get swept up in the charm and sheer addictiveness of the app. They are as cringey as they are creative, and the content they produce has largely been made on their own terms. This makes them a powerful tool for companies running campaigns on the platform. Flow Adepoju, head of retail partnerships at creative marketing agency Fanbytes, explains: “A successful campaign will need to lean more on the TikToker. The more organic the content can feel, the better it’s going to perform on the platform.”

Despite the value of TikTokers for incoming companies, TikTokers still feel the platform is not very profitable. Uploaders can make money in three ways: through live-streaming and being sent “gifts” (essentially fan donations) by the viewers, through working with brands to promote their products, or by promoting a song or album. The majority of TikTokers report that the main way they are currently making money on the platform is through live streams with “gifts” from their fans.

“I have really sweet followers who will join and interact with me and, at times, donate,” Lugor explains. “It’s definitely not enough to live off of, but it always helps.”

Isabella Avila, known on TikTok as Onlyjayus, has been going viral for wowing followers with fun facts (most recently, a video about how much money Bill Gates has).

“TikTok is less profitable but it’s way easier to get a following,” she says. “I had a YouTube channel for three years and only got 10,000 subs. I’ve been on TikTok for two months and I’m over 100,000. It’s because your video is to get in front of eyes.”

This puts TikTokers in a unique position. The app has given them something unprecedented: instant virality. TikTok’s algorithm is driven by what will keep you entertained. It gives a chance for creators without large followings to experience a virality that is harder to get on other platforms. But it comes at a cost: not as much money.

Lugor explains: “I think what holds me back from a lot of financial opportunities is my fear of disconnecting from my audience. The people that follow me mean a lot to me, and I don’t want them to feel like I lost that sense of relatability. It’s hard for me to find a proper balance between wanting to make money, and wanting to please my audience.”

TikTok is actively giving brands the tools they need to make money on the platform without giving much thought about who it ultimately hurts the most: the TikTokers. As the platform continues to hurdle towards infinite downloads, will TikTokers be given ways to make money that don’t harm the anti-curated attitude of their content?

FFWD

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