HOW TIKTOK CAN MAKE YOUR SMALL BUSINESS A SUCCESS

Natalia Birriel Fernandez

EIC BC Law Student

October 20, 2023

Between the COVID pandemic and the rising inflation costs that have affected the country these past few years, it is harder than ever for new business owners to grow their ventures and become successful entrepreneurs. But trying times can also offer opportunities for innovative ideas, and many business owners have found ways to use social media to gain customers. One platform has quickly become a tool for marketing and increasing sales: TikTok. The newer social media app rose in popularity in 2020, boasting around 1 billion active users who spend a significant amount of time, and money, on TikTok. With lawmakers now threatening access to TikTok, it is critical for small businesses to understand how these proposals could harm them.

How TikTok Promotes Small Businesses:

TikTok’s audience is largely Gen-Z and Millennials, and they use it a lot, with many younger users even preferring this app as their go-to search engine over Google. Approximately 81% of TikTok users turn to the app when they want to discover products and brands, while around 50% of users are likely to buy something from the app.[1] TikTok creates the potential for businesses to tap into a large customer base by posting content related to their company, one in ten small businesses have already gone viral on TikTok and increased their visibility.[2]

One of the features that makes TikTok such a powerful tool for promoting businesses is the ability to use creativity to show the audience what makes a business unique. Being able to interact directly with customers by publishing content targeted to them and replying to their comments makes connecting naturally a lot easier than it has ever been. Creating videos that entertain or inform viewers while doubling as free advertisement makes for a powerful way to market a business and connect with customers. Personalizing videos based on what type of content the target audience reacts best to allows accounts to drive up engagement, which makes the videos appear in the feed of other users that may enjoy similar videos and grow the audience even more.[3] This tailoring of content is the trick of the TikTok algorithm, and what allows smaller accounts to gain a lot of viewers or go viral because user engagement increases their impact.

Speaking of going viral, while it is important to stay authentic because genuine content is better received, another way to reach a broader audience on TikTok is participating in popular challenges and subcultures. There are challenges constantly going viral on TikTok that feature specific hashtags or sounds, which businesses can easily participate in, so the video appears when people search the challenge.[4] Another great tool for discovery is the subcultures, these are communities of users who share the same interests and have created their own hashtags or pages to stay connected and easily find videos. Posting videos that include a subculture’s hashtag will lead people to your content without any extra work, for example #PetTok if your business involves animals or #FoodTok for a food business. Tagging a location can also help boost specific videos by allowing people who search a place or those who are in that area to discover the video.[5]

The TikTok Legal Limbo:

The proposed TikTok ban earlier this year if the app was not sold to an American company understandably alarmed many users. Congress held hearings due to concerns that ByteDance, the Chinese company who owns TikTok, could rely on Chinese laws that allow the country’s government to obtain data from any organization or citizen to access their American user’s data.[6] For the approximate 5 million businesses on the app, banning TikTok entails losing access to their marketing platform and all the costumers in it. Although no outright ban resulted and there are doubts about the legality of such action, some states have begun passing bills to create local TikTok bans.[7] Montana’s governor signed a bill to stop app stores from offering the TikTok app starting in 2024. In many states, TikTok was banned from government-issued devices and some colleges have enacted app blocks in their networks. There have been various lawsuits in response that are currently pending, as the concerns of businesses grow.[8]

Strategies to Boost Your TikTok:

Solutions other than a complete ban have been proposed by TikTok and are more likely alternatives to avoid challenges due to First Amendment protections, logistical concerns, and other legal issues. Although TikTok’s future remains uncertain, it is still a great option for businesses to build their marketing in the platform and gain customers in the meantime.[9]

TikTok’s ease of use is one of the traits drawing entrepreneurs to rely on it for their marketing.[10] Data shows that TikTok users spent around 2.3 billion dollars last year purchasing products they found on the app.[11] With the addition of TikTok Shop in September, which allows user to buy products directly on the app, these numbers will likely increase even more this year.[12] Smaller businesses can take advantage of the TikTok Shop by selling products directly on TikTok without having to design a separate website.

TikTok For Business is another way to maximize reach, this free setting allows you to create a business profile with access to advanced analytics features. These tools can help with scheduling posts at times the audience engages with videos the most and to evaluate the performance of posted videos.[13] The free ways to advertise businesses on TikTok can be expanded even more with affordable paid advertisements. There are several types of adds available, like Top View Ads and In-Feed full screen Ads, that can amplify a company’s exposure.[14]

Conclusion:

As TikTok continues pushing boundaries and finds ways to thrive in America, it is imperative that savvy entrepreneurs take advantage of this platform. One thing that every business, from new startups to TikTok itself, must do to succeed in today’s competitive market is learn to become adaptable.

[1] https://www.usatoday.com/story/money/2022/09/18/why-your-small-business-needs-tiktok/10383223002/

[2] https://www.capterra.com/resources/tiktok-marketing/

[3] https://sproutsocial.com/insights/small-business-tiktok/

[4] https://www.uschamber.com/co/grow/marketing/tiktok-tips-for-small-businesses

[5] https://www.usatoday.com/story/money/2022/09/18/why-your-small-business-needs-tiktok/10383223002/

[6] https://ny1.com/nyc/all-boroughs/politics/2023/07/17/will-congress-still-ban-tiktok-four-months-after-hearing-

[7] https://www.nytimes.com/article/tiktok-ban.html

[8] https://www.cnbc.com/2023/06/09/tiktok-ban-potential-impact-on-small-businesses-entrepreneurs.html

[9] https://www.nytimes.com/2023/05/22/technology/tiktok-montana-ban-lawsuit.html

[10] https://newsroom.tiktok.com/en-us/new-study-shows-small-businesses-are-finding-their-home-on-tiktok

[11] https://www.score.org/resource/blog-post/emerging-impact-tiktok-small-businesses

[12] https://newsroom.tiktok.com/en-us/introducing-tiktok-shop