TikTok’s latest study regarding Short term and long-term ROI of TikTok advertising

Graph showing impact of TikTok sales

TikTok and Dentsu published a study looking at the short-term sales impact between 1 to 6 weeks and then a longer-term view between 1 – 10 months across 15 brands in the Nordic region.

The main callouts from their study are below:

For all 15 advertisers in the study, TikTok had the highest short-term ROI at 11.8 with an average of 8.7 for the other channels. Advertisers measured an effect from ended TikTok campaigns up to 4 weeks after the end date.

TikTok had a long-term ROI of 4.5, higher than the average of other channels at 3.2

Dentsu and TikTok categorised all the ads on the platform into three main categories: Professionally produced, Tactical UGC and Storytelling UGC. The Tactical UGC contains promotional messaging with clear intent to drive sales. The Storytelling UGC is more of a narrative approach avoiding promotional messaging. The study showed that the Storytelling UGC had a 70% higher impact on sales than the tactical UGC and a ROI of 17.8 vs 10.1 for Tactical UGC.

Consistency is a driving factor for channel success with the advertisers seeing higher sales impact from sustained Always on activity compared to short campaign bursts.

I believe the biggest callouts from this study are the insights on the type of content and strategy that outperforms according to the study. The notion of platform native creatives is unknown to a strong portion of advertisers. Adapting the creatives to align with the content platform users are willing to see is key for increased completed view rates and keeping valuable user attention. The callout regarding the always on strategy is also interesting to note as advertisers may not see the benefit of running Always On activity hence miss the incremental sales impact of keeping in audience’s top of mind.

I however believe there are a few caveats to note regarding this study, the main one being only Nordic brands being studied hence we are not including a location factor in the results hence we may not see the same results in the UK. 15 advertisers is also a small pool to use as a test hence the significance of the results may not be as relevant as marketers usually work with. ROI is a difficult metric to measure hence the reliance of ROI throughout this study undermines the validity of the findings especially with debates around attribution. It would definitely be interesting to have a deeper dive into how their ROI is measured.

Nevertheless, it was definitely an interesting read and could definitely adapt future TikTok strategies as a test and learn with these findings. Here’s a link to read the full report.