The TikTok Ban-Saga Continues

As the U.S. government takes more steps toward a ban or forced sale of TikTok some of us are feeling heavy déjà vu. Including flashbacks to the town in ‘Footloose’ where dancing was outlawed.

The viral social media app was released in 2016 but didn’t reach mainstream popularity until the dawn of 2019. It was quickly met with scrutiny from government officials, as the FBI stated it could pose a national security risk.

In 2020, then-president Trump issued an order for TikTok to be banned or sold to a U.S. company. This fell through only after TikTok agreed to partner with Oracle to protect the data of U.S. citizens.

This was not the end of the story. Even after the Oracle-TikTok partnership created ‘Project Texas’ to protect U.S. data, in 2023 the Biden administration banned the app from all federal devices.

A month later, TikTok CEO Shou Zi Chew participated in a congressional hearing to defend the company but the House Committee on Energy and Commerce still supported a full ban. Montana then became the first state to attempt a full ban, however it was blocked before it could take effect.

Now here we are in 2024. A bill to force the sale of TikTok to U.S. interests passed in the house of representatives with bi-partisan support. President Biden has promised to sign the bill if it passes the Senate vote. If this comes to pass then ByteDance (TikTok’s parent company) would have 165 days to divest its ownership of TikTok.

What does this mean for marketers that rely on the platform?

Many brands have seen incredible success with TikTok marketing. DTC brands have especially thrived in the space, some committing all of their marketing efforts to the app. It’s not a stretch to assert that the popularity of TikTok resulted in the meteoric rise of the UGC ad format.

But it’s not 2020 anymore. TikTok no longer has a pseudo-monopoly on short-form video. IG reels and YouTube shorts have become popular alternatives for doom scrolling social media users and, as a result, advertisers. Most brands have been cross-sharing their organic content between these platforms for over a year now.

Who benefits from a TikTok ban?

With Meta’s stock price already hitting new records, how much better could it possibly get for the social media giant? Turns out it could be even better.

eMarketer found that Meta and Google, would likely make billions in incremental ad revenue if the TikTok ban becomes law. However this certainly wouldn’t help Meta in its ongoing antitrust court case with the FTC.

Brand marketers appear to be divided on the issue. One less platform to nurture with organic content and optimized ad spending could bring some sighs of relief. Some have expressed they would simply pivot a similar creative strategy to Instagram and YouTube or devote their current TikTok budgets to exploring new platform opportunities like Pinterest.

Others believe a TikTok ban would result in massive missed marketing opportunities.

Melissa Palmer, co-founder and CEO of beauty brand Osea Malibu told MarketingBrew that she believes the ability to “win with good creative” is already more challenging outside of TikTok. It continues to become harder to do on Instagram/YouTube and a TikTok ban would make it even more challenging.

“Losing TikTok could mean losing the opportunity to build brand awareness and visibility that hasn’t yet been replicated on platforms like Instagram,” she said.

Our Prediction

TikTok will not be fully banned in the United States. We believe it’s more likely that ByteDance will capitulate to some form of shared-ownership or other complicated legal arrangement to allow TikTok to continue operating on U.S. devices.

For most brands and creators it will be business as usual. The only real changes we expect to see are harsher crackdowns on the sharing of copyrighted content on the app and a lowered visibility of “harmful” content, whatever the controlling interest deems that to be.

We could be wrong. Only time will tell what will happen to our beloved viral dance app. It may continue to be a staple marketing channel or it could fade into the historic time capsule of the early 2020’s along with custom-printed medical masks and corporate social-distancing signage.