TikTok has quickly become the powerhouse for creators and advertisers alike. When they join together, they can create quite the profit for a brand. However, what would happen if the biddable ads on the platform came into play?
To best define biddable media, it’s when advertisers and marketers bid for paid search or paid social media spots to place their advertising. This is essentially competitive bidding for ad space, and it normally occurs in real-time. The one thing both advertisers and marketers know is that advertising/marketing in this way incorporates so much more than what one might initially expect.
One of the bigger questions for this type of platform is the cost. When it comes to any type of biddable advertising, the cost can be somewhat of a grey area. This is especially true when you look and see that not one advertising platform is the same either. By looking into TikTok ad costs in their biddable ads, we’ll search to find clarity and to find a base for marketers/advertisers to look to for reference.
TikTok Ads Minimum Cost
For TikTok ads to truly be effective, there is a set minimum budget that they require when brands choose to market or advertise on the platform. In fact, they want to make sure there is a sufficient budget at hand so that the maximum outcome can really be achieved for the brands.
With this being said, the minimum budget at the campaign level is placed at $500 while at the ad group level it’s at $50. Of course if needed, that budget can be altered, but this is the base the platform is currently comfortable with setting.
When looking at TikTok advertising in general, it’s not known to be the cheapest. Take a look at the following.
- Brand Takeover- $50,000 per day (5 million impressions guaranteed)
- In-Feed- $10 per impression (minimum 600 impressions prepaid)
- Hashtag Challenge- $150,000 per week
What’s the Average Cost Per Click?
While all advertising budgets and outcomes are pretty different, it helps to know that there is a base that can be followed. We analyzed a budget of $50,000 and compared its usage between Facebook, Instagram, and TikTok.
In that analysis, TikTok ads actually generated 155% more clicks all while spending 36% less money. This is quite a significant difference and one to be watched for future ad campaigns.
Within that statistic, the CPC for TikTok was at a total of $0.19 while Facebook and Instagram was at a combined $0.46. For more clarity, all advertisements were run in the United States only.
What About Cost Per 1000 Impressions (CPM)?
Now when we look at CPM, similar results also ensue. On that same experiment, the TikTok CPM only cost $1.82 while the combined Facebook and Instagram cost for CPM is $6.73. This is a huge difference, and shows that with this particular experiment that TikTok is able to deliver more.
The total spending for this TikTok campaign ended at $20,128.11 whereas the total spending for Facebook and Instagram ended at a total of $31,615.51.
When looking at TikTok advertising in general, the rationale for this difference in cost may also rely heavily on the fact that this is a platform that has been able to command some of the highest engagement from all different users and audiences. In fact, this is an app that is the most downloaded in 2020 and has over 800 million monthly users.
Let’s Look at the Functioning and Positives of Ad Auction Work
Believe it or not, bidding is actually a strong part of the overall ad creation process. There are actually several different types of bidding that a marketer may choose from as they maneuver through the ad posting.
As of right now, these are the four different bidding methods:
- Cost Per Click (CPC)
- Optimized Cost Per Click (oCPC)
- Cost Per Mile/Thousand Impressions (CPM)
- Cost Per Thousand Views (CPV)
All four of these are able to contribute to different results from the consumer as well as give the marketer the ability to shift and alter the budget where she sees fit.
How to Determine TikTok Advertising Costs?
There are actually two different ways you can pay for advertising on TikTok by choosing from the following.
Budget: There are two different budgeting options for TikTok ads. These are daily or lifetime. Marketers actually have the capability to change out the budget on their campaign at any time. Best of all, the system won’t ever exceed on the budget that’s set.
Bid: On the other hand, there’s a bid that shows how much a marketer is willing to pay for the action, and we’re currently finding out how to determine the costs for it all.
How TikTok Compares to Other Platforms
While all platforms have their own strengths, TikTok has been proven to be unique and valuable in it’s own ways. According to Digiday, TikTok’s cost-per-thousand impressions are as low as $1. On Facebook, the cost has the potential to raise as high as $4 on the news feed and story formats.
This cost comparison alone makes TikTok desirable enough for consideration, especially since they’re able to provide the results to match.
TikTok biddable ads definitely have their perks, especially since the platform alone already delivers so many different and unique features. When compared to other major social media platforms such as Instagram and Facebook, it also proves to have its own strengths that don’t quite compare to the rest.
As we all watch TikTok grow and change, it can be easily understood that this isn’t a platform to come and go super quickly either. The momentum in the past year has been able to propel it far enough that it’s size and influence will not be easily diminished.
Are biddable cost ads worth it to you and your marketing/advertising campaigns? Are you planning on utilizing TikTok Ads with a TikTok advertising agency? Let us know in the comments as we’d love to know your thoughts and actions during your campaign process.