The owner of TikTok ByteDance is raking it during the coronavirus pandemic

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Why this doctor and nurse are now TikTok famous

The artist and influencer have already had a healthy following on Instagram. And like many other friends, the 31-year-old had dismissed TikTok as a teen app.

But the spread of the virus in New York City forced Tsui to wait for the pandemic at home, and she found herself with a lot of free time to try something new.

Tsui is not alone. In recent months, hundreds of millions of people around the world have downloaded the reduced-size video app as the United States, Europe and elsewhere impose strict restrictions in order to curb the spread of the coronavirus.

For many people, the app has become a fun escape from all the sad news about the virus and its budget.

TikTok has caught on to the problem at the moment, prompting optimistic hashtags like “#HappyAtHome”, which has seen many users tie their parents to making TikTok videos. It also promotes live streams of relaxing content: on a recent Wednesday, for example, one of these streams was broadcasting live footage from a Panda sanctuary.

Promotions seem to pay off. TikTok was downloaded 315 million times from January to March, according to Sensor Tower, an amount that according to the analyst firm has surpassed any other app ever for a single quarter. TikTok now has a total of 2 billion downloads, doubling its total from just 15 months ago.
The company it is also conquering coveted users, such as Hong Kong content creator and influencer Taylor Richard, who has over 300,000 Instagram followers (owned by Facebook (FB)) and 1.1 million YouTube subscribers (owned by Google (GOOGL)).

He said TikTok approached his last year to join his platform. Richard, 31, thought it was a little too small for her.

So the coronavirus epidemic hit, and Richard found himself hooked on TikTok’s 15-second videos.

She also liked that more “older people, like my generation and older, joined it. And many songs are from my generation,” she said.

Richard, who has around 15,000 followers in the app, joined in early April and TikTok now sends out its weekly emails, telling it which hashtags are doing well and providing examples of trending video content.

The record influx of new users is a big win for the owner of the ByteDance app, who has tried to capitalize on the worldwide appeal of TikTok. The app is the only social media platform created by a Chinese company to achieve significant traction outside of China.

But the success of the Beijing-based startup within China during the pandemic has also been enormous – and could provide clues to how TikTok hopes to become a major money maker in the future.

A record quarterly radius

ByteDance’s mobile apps grossed $ 157 million from January to March, according to Sensor Tower. Almost 90% of this amount came from China and was almost entirely led by Douyin, the Chinese version of the company’s killer app. It was a quarterly record for ByteDance, with a 423% increase over the same period of the previous year and a 50% increase over the previous quarter.

Bytedance did not respond to requests for comment for this article.

The first week of February was Douyin’s biggest week ever, with users spending more than 3 billion hours in the app, up 130% from the weekly average of 2019, according to analytics firm AppAnnie.

In China, live streaming is very popular. Influencers often make money by receiving virtual tips during live streams.

“In general, on Chinese apps, there is a habit of tipping content creators,” said Wiktoria Marszałek, account manager of Nanjing Marketing Group, a company that helps foreign companies grow their brands and their sales in China.

For example, he said, Douyin users purchase donuts or virtual hearts that they can give to content creators or influencers during live streams. All of this translates into in-app revenue for ByteDance.

The company still earns most of its money from advertising. Consulting firm R3 estimates that ByteDance made 50 billion yuan ($ 7 billion) of advertising revenue in the first half of 2019 alone.

But the in-app revenue they get from Douyin and TikTok users is more than just changes.

Douyin and TikTok’s revenue “is skyrocketing now,” said Randy Nelson, an analyst at Sensor Tower. Sensor Tower sees TikTok and Douyin essentially as the app itself, citing the similarities in branding, marketing and user experience.

Nelson said that the app’s success in user monetization places it in the same league as the top entertainment companies.

When it comes to non-gaming apps, TikTok in third place in March for global in-app revenue, after the Tinder and YouTube dating app. Disney (DIS) new streaming app e Netflix (NFLX) completed the first five.

“It was on Disney +, it was on Netflix. And this is without Android in China,” he added. Sensor Tower can only track data from the App Store and the Google Play Store and the Play Store is prohibited in China.

People wearing masks livestream on Qianmen Street on April 25 in Beijing, China.

Some influencers are betting on the TikTok post-pandemic

TikTok didn’t see a boon like Douyin, because it only started monetizing through advertising and live streaming last year, according to a TikTok spokesperson.

But Douyin provides clues to how TikTok hopes to emulate the financial success of its Chinese sister app. For example, TikTok made live streaming available to users with a number of followers last year.

It remains to be seen whether the functionality will take off outside of China.

Westerners “are not so used to the Chinese style of live streaming,” where influencers flow for hours just to mow goods, said Marszałek, of the Nanjing marketing team. “In China they sell, sell, sell,” he said.

Nurses and doctors flock to TikTok to make jokes and lip syncing. But the patients are eroding & # 39; confidence?

Giving virtual money to content creators on social media isn’t even a common practice: Facebook has an in-app currency that it introduced so that users can tip content creators, but it never gained traction, according to Nelson , by Sensor Tower.

TikTok has also started experimenting with e-commerce buttons for selected advertisers and influencers, second to Digiday. Advertising revenue would be shared between TikTok and the influencer, similar to what has already been done in China on Douyin.

Like many other social media companies, TikTok predicts that the coronavirus will deal a serious blow to advertising revenue in the United States, Europe and other markets in which it operates.

He started to “donate” advertising credits to health organizations to publish updates on the pandemic. TikTok will offer more free advertising space to restaurants and small businesses when they start to reopen, the spokesman said.

Once companies start spending again, users like Tsui bet that TikTok will be the place to splash money.

With dance challenges and explanatory videos, publishers invade TikTok in Gen Z court

Before moving to New York, Tsui lived in Hong Kong, where he earned around $ 1,500 per month collaborating with brands and advertisers to promote their articles to its 74,000 followers on Instagram.

Breaking up on Instagram in New York proved difficult. But now, “since everyone is talking about TikTok, brands are really targeting influencers and running ads on TikTok,” he said.

Tsui joined TikTok in early April. One of his posts managed to get a coveted spot in the app’s “For You” feed, a place where users can watch content that the TikTok algorithm believes they might like, based on the behavior passed in the app. Tsui went from 17 followers to over 10,000 overnight. He currently has around 27,000 followers.

The native of New Zealand he is now trying to understand TikTok’s notoriously opaque algorithm in the hope of being able to develop a following strong enough to earn gains.

“I think TIkTok is the way to go in the future in terms of advertising and product promotion,” said Tsui.

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