Quick question. What streaming platform has over 22 trillion minutes of content watched in 2021? Not Hulu, not Disney+ and not Netflix.
It’s TikTok. And as a way of comparison, Netflix, the clear leader in streaming, only had 9.6 trillion minutes watched in 2021. That’s a ridiculous number for TikTok, especially for what many in the media world are still referring to as a “social network.” That’s the problem. We’re continuing to silo TikTok into the social space, thinking that we’re just sharing funny memes and birthday photos on the platform. We need to shift how we view TikTok, here’s why:
As advertising people, we’ve continued to talk about the platform as a “social” one. While the app still has much of the same functionality as other social platforms, it’s not the primary reason we’re drawn to it. The app has become our new, short-form streaming platform. It’s as if Vine and Quibi had a child — TikTok has captured what we all knew: short-form video was going to be the wave of the future. Little did we know what was originally full of dance videos has now become the dominant player in the streaming space, and the “social” one too.
While Instagram and Facebook are busy trying to rework the platforms to look and feel more like TikTok, and in the process upsetting everyone, including the Kardashians, TikTok has kept it simple; video, full screen, no distractions. Much like Twitter is used for news gathering by majority of its users who never Tweet, TikTok only has about half its users actively posting content (video), which is still a big number, but it speaks to the consumption argument, and why we should look at it as a mobile streaming platform first, social network second.
It’s no surprise that traditional streaming networks are now looking to advertising to help subsidize them. The size of investment over the last few years in content on these platforms has been almost unsustainable. By some estimates, the combination of investment of the top 8 platforms was about $115 billion. If we assume that there are about 80 million households with streaming capabilities in the U.S., then we are talking about $120 per household per month in subscription fees, just to break even (which is the reason that advertising is now coming to Netflix and Disney+). TikTok spends about $200 million per year on “content,” yet still captures almost 2X the viewership minutes. How is this possible? The discovery element driven by an incredible algorithm is what continues to keep us watching for 11 minutes per session on average. With a 24 second average video length, that means we’re consuming about 28 “shows” per session. And the majority of those “shows” are produced at no cost to TikTok. According to a TikTok user survey, about 1/3 of users spend LESS time watching streaming, and spend approximately a movie-length amount of time on the platform daily.
As mentioned above, the secret sauce to TikTok lies in its algorithm (which we could find out more about soon), and serving videos that you didn’t realize you were interested in. This is where it begins to separate itself from social networks and position itself as a top streaming service. Where Netflix might use 3-4 signals of what you like based on how much of a show you watched, what titles you searched for, how many episodes of a series you watched, and so on, TikTok measures exponentially more. The algorithm tracks how many seconds you watch, if you rewatched, if you paused, if you visited the creator, clicked a hashtag, the list is endless. All these signals inform what you watch next, and before you know it, you’re served videos you like, but didn’t realize. This creates continued engagement, longer watch times, and more videos consumed.
Moving forward, thinking about TikTok in the streaming set of paid media vehicles helps to create more holistic plans, reaching users as they move through their day. It’s not TikTok Vs. Instagram, but the conversation should be around TikTok Vs. Netflix (or Hulu, etc.). Continuing to segment TikTok into the social media space continues to ignore the true potential of TikTok as an advertising platform, one that we as advertisers should take full advantage of.