Brief:
- Global video platform TikTok boosted its user base by about 30% to more than 130 million viewers since its owner Bytedance merged the app with lip-syncing app Musical.ly in early August, according to researcher Apptopia. TikTok's worldwide downloads increased 20% and U.S. downloads rose 25% from the prior three-month period.
- TikTok last month overtook YouTube, Instagram, Snapchat and Facebook in a ranking of U.S. downloads from Apple's App Store and Google Play. However, TikTok's engagement rate of 29% is less than those for Facebook (96%), Instagram (95%), Snapchat (95%) and YouTube (95%), according to Apptopia, which measures engagement as the portion of monthly users who open an app every day.
- Apptopia attributed TikTok's surging downloads to a significant increase in ad spending on Facebook, Google's mobile ad platform AdMob and in-app ad platform Vungle, among other platforms. Apptopia also said that TikTok's growth likely resulted from combining downloads of separate apps in different countries into a single app during the merge.
Insight:
TikTok has become more popular through organic growth, combining country-specific apps into one, and the merger with Musical.ly, which Bytedance acquired for about $800 million. That combination may give TikTok the scale to compete more effectively against social media rivals like Facebook, Instagram and Snapchat. Musical.ly became very popular since launching in 2014 and faced challenges in monetizing its audience amid reports that many users were in grade school, despite a requirement that users be at least 13 years old, per the Hollywood Reporter.
The popularity of TikTok has caught the attention of Facebook, which saw revenue growth fall to a six-year low last quarter as the social network makes a transition from monetizing its lucrative News Feed format to products like Stories. Facebook started developing a standalone app called Lasso that takes aim at TikTok's teen audience with similar lip-syncing and video-sharing features. The push comes as just 5% of U.S. teens describe Facebook as their favorite social network, according to an annual survey by Piper Jaffray.
TikTok videos also have begun to go viral outside of the app with millions of views on Twitter and Instagram, The Atlantic reported. YouTube users have posted compilations of top TikTok videos that also earn millions of views online. As more valuable users create and share videos, TikTok may be able to broaden its appeal among advertisers and beef up its revenue stream to keep ahead of the deep-pocketed social networks it competes against.
