📉 Slowing Ad Spend Growth
TikTok's ad spend grew 19% year-over-year in March but slowed to 11% in April and 6% in May 2024. Total ad spend from January to May 2024 reached $1.5 billion, up 11% from the same period in 2023. This indicates that despite the slowdown, TikTok remains an attractive platform for advertisers due to its massive user base.
🎯 Shifting Focus
Advertisers are shifting their focus on TikTok from brand awareness to more performance-driven ROI goals. CPMs for upper-funnel metrics were up 15% year-to-date at one agency, and click-through rates increased 27% in April compared to March. This shift suggests that advertisers are seeking more measurable returns on their investments.
📊 Demographic Changes
TikTok's user growth is stagnating, particularly among younger demographics. The percentage of weekly users aged 18-24 dropped from 35% in 2022 to 25% this year, while users aged 35-44 increased from 16% to 19% in the same period. This demographic shift might impact how advertisers target their campaigns on the platform.
🔍 The Bigger Picture
Despite the slowing ad spend growth and demographic changes, TikTok continues to offer significant value due to its high engagement rates. Advertisers still find value in TikTok’s massive user base and strong engagement. The ongoing discussions about TikTok’s future in the U.S. market will be crucial in determining its long-term viability as an advertising platform.
Will TikTok’s engagement keep advertisers loyal?
