Every few months, TikTok launches a new feature to go head-to-head with the biggest companies in music and media. Here’s a short list of moves it announced in the past year and the market leader in each area:
– Extended video length to 10 minutes (competes against YouTube)
– Launched SoundOn, a music distribution service for artists (DistroKid)
– Filed a trademark for TikTok Music, a potential music streaming service (Spotify/YouTube)
– Enabled artists to pre-release songs before they go live on streaming (Twitch)
– Enhanced search function to identify terms in comments (Google / YouTube)
– Created its own NFT marketplace (OpenSea)
TikTok’s goals make Kanye West’s infamous Donda org chart look modest! ByteDance, TikTok’s parent company, is on a mission to eat everyone else’s lunch and drink their milkshakes.
The Chinese-based company is the fastest-growing app to reach 1 billion monthly active users. It has Gen Z in an attention chokehold and has scaled on the back of music. TikTok wants to monetize the attention it has captured with artists, content creators, and users.
But big companies don’t always succeed with copycat products. Its success in each area depends on what its most valuable users need most from the platform, and whether TikTok’s offering is the preferred alternative for those same core users.
Big social networks rarely win at everything
TikTok’s product rollout strategy feels like a page out of Facebook’s playbook. After Instagram Stories successfully copied Snapchat Stories in 2016, Facebook increased its attempts to do the same in other areas.
“What if Facebook launched a version of your product?” was a question every founder of a consumer startup had to be ready to answer when fundraising.
But for every win like Stories, there are several less successful attempts. Facebook Gaming has had its challenges. Tinder isn’t losing sleep over Facebook Dating’s impact. And Facebook’s Zoom competitor, Messenger Rooms, looks like an afterthought based on Google Trends.
Instagram Stories worked well because it solved a problem that influencers had while using the app. Influencers, Instagram’s core users at the time, felt pressure to post perfect images which made them less likely to share. ‘Stories’ let them share temporary photos and videos. Problem solved. And since Instagram had more influencers than Snapchat, it didn’t take long to claim victory.
Meanwhile, Facebook Gaming, Dating, and other meddling attempts didn’t solve problems directly related to how its core users use the platform. The ‘gamer’ audience may technically be active Facebook users, but they aren’t checking for Facebook to play games. They are probably checking Facebook to remember their friends’ birthdays!
Just because a company has an audience does not mean that the audience wants all their needs met by that company.
Meta’s lucrative ad business makes it easier to justify its spray-and-pray, venture capital-style approach to product launches. TikTok’s revenue is growing fast though (expected to reach $12 billion in 2022), so we’ll likely see its big bets continue.
TikTok’s triumphs and struggles
TikTok’s advantage is that it’s the easiest platform to gain followers. It’s For You Page is a superpower for creators to get discovered and for consumers to passively engage without actively following anyone. But it’s the hardest platform to translate that awareness into a true fanbase. Your followers are not necessarily your fans, and that’s especially true on TikTok.
And like Facebook, TikTok is less successful in areas that don’t align with its users’ expected experience. In August 2020, TikTok hosted a virtual concert with The Weeknd that was seen by just 2 million unique viewers. It was far less than the 27 million who saw Travis Scott’s concert on Fortnite in April 2020.
That’s not because of the artists’ popularity differences. It’s because virtual concerts are a natural user experience for Fortnite gamers, who were also well-aligned with the Travis Scott fan persona. Fortnite’s concert also happened at the peak-quarantine moment of the COVID-19 pandemic. Everybody was already inside.
Meanwhile, TikTok’s concert happened when many restrictions were lifted. And plus, TikTok’s metaverse-inspired concert was a big context switch for most of its users who mindlessly scrolls through the app on their phone.
The other elephant in the room for TikTok is the company’s geopolitical turmoil. Recent reports show that China does have access to TikTok user data and can do surveillance on American users. While past attempts by the U.S. government to shut down the app have failed, the looming concerns aren’t going away.
Predictions on TikTok’s initiative
In 2021, TikTok’s NFT platform launch didn’t go well. Sources told Rolling Stone that the project felt rushed. Artists like Lil Nas X and Grimes had releases that didn’t go as planned. The company may have improved its product launch process since then, but it is important context given its plan to enter other areas.
Here’s how I predict each extension will go.
10-minute videos: TikTok is the new MTV. If users enjoy watching short-form videos of entertaining content, they’ll watch longer form ones too. If longer videos are available in the app from artists and creators they love, then they’ll watch them on the app.
Likelihood of success: HIGH.
TikTok Music: TikTok already has the interest of both artist and record labels, but digital music streaming services need to consumer buy-in as well. Streaming requires active participation from users. Most people don’t passively scroll Spotify the way they do with TikTok. The better comparison may be YouTube, which relies more on ad-supported revenue than the other streaming platforms.
Likelihood of success: LOW if it tries to compete with Spotify, Apple Music, and Amazon Music, but MEDIUM if it goes the YouTube route.
TikTok search: It’s easy to find relevant search results on TikTok. “I don’t Google anymore I TikTok” went viral for a reason. The quick results are easy compared to the cognitive overload that can happen with Google and YouTube search results. But it may take time for the SEO to get on Google’s level. TikTok’s spread of misinformation may hurt its search integrity, but there’s plenty of potential to improve.
Likelihood of success: HIGH, but a few caution flags.
SoundOn music distribution: Artists use TikTok all the time. Labels already want them to release music directly to fans. TikTok already partnered with UnitedMasters, a music distribution service, so it understands the opportunity. But Spotify and others have ended similar programs. Customer support costs are quite high, so the return on investment needs to be there.
Likelihood of success: MEDIUM.
In-app ticket purchasing with Ticketmaster: Ticketmaster has similar integrations with YouTube and Spotify. I’m sure TikTok would love to sell tickets directly without an intermediary like Ticketmaster, but one step at a time.
Likelihood of success: HIGH.
Big companies are built to take big swings and copy the success of others. That’s how they stay relevant. There’s a reason why Facebook became Meta. It wants to be the leader in web3 and the metaverse.
TikTok has that same vision. It will have more success with products that double down on passive engagement and serve its most active artists and creators.
But expecting the end consumer to adapt—especially since TikTok has made it easy and frictionless for them— will be the hardest part.