Being Monitored by the US Government, TikTok Becomes the Darling of Uncle Sam's Companies Advertising

Dream - Amid the US government and Senate's efforts to restrict TikTok's movements, this Chinese-origin platform has become a darling among businessmen. It is known that Uncle Sam's companies have spent billions of US dollars to advertise on the platform, including sports broadcasts.

Business people are taking advantage of TikTok, which is currently under the supervision of the US government, as it is considered effective in reaching a younger audience.

TikTok also helps advertisers cut large TV advertising costs, such as for the NFL Super Bowl and NCAA March Madness basketball tournament.

During this year's Super Bowl, State Farm chose to opt out of TV commercials during the big game. Instead, the company created an advertising campaign focused on TikTok and social media.

The same goes for automaker Hyundai, which prioritized TikTok this year, as many car manufacturers skipped TV commercials during the Super Bowl to save money or spend on other platforms.

TikTok's advertising revenue is projected to reach US$6.83 billion in 2023, up from over US$5 billion in 2022, according to data from Insider Intelligence.

This figure represents about 2 percent of the rapidly growing digital advertising spending. Insider Intelligence also expects TikTok's advertising revenue in the US to exceed US$8 billion by 2024.

When the March Madness Tournament was taking place, deodorant brand Degree also used TikTok as its main marketing channel to reach consumers during the event. They also hired NBA star Giannis Antetokounmpo as their spokesperson.

"TikTok has really transitioned from an experimental game to a must-buy for many advertisers. At this point, we see many advertisers relying on TikTok, some may be too much with what is happening," said Jasmine Enberg, a social media analyst at Insider Intelligence.

Despite the high prices and high demand for TV commercials during live events, the advertising market as a whole has slowed down in recent months due to economic uncertainty, which also burdens traditional media companies like Paramount Global.

Source: CNBC International