Introduction
TikTok is a social networking platform owned by the Chinese international company ByteDance. The service has gained popularity and a respected reputation due to the nature of the products and services it offers. Almost half of the users are young people, and its addictive nature makes people visit the site more than once daily. The most popular markets of TikTok are the South and Eastern parts of Asia, Russia, the USA, Turkey, the UK, and Australia, with prospects growing worldwide (Green et al. 2022). The service’s growing popularity is due to its increasing number of loyal users and the teamwork culture that keeps users connected.
Origin and Development
The first video was launched in December 2016 and has grown exponentially; today, it is available in over forty languages serving customers worldwide. The service hosts an array of short videos in different genres, such as stunts, pranks, jokes, dances, and tricks, with lengths from fifteen seconds to ten minutes (Ma, & Yu, 2021). The service initially gained popularity as Facebook users used it to share memes and other funny content. TikTok for Android and iOS operating systems was launched in 2017 and made its operations worldwide after merging with the largest social media company in China, Musical.ly.
Features and Rising Popularity
TikTok as an application became the leading free download in application stores in Thailand and other parts of the world merely a year after its launch. Today, the application has been downloaded over one hundred and thirty million times in the United States of America and has over two billion downloads worldwide. Further, each user has a chance to watch only the videos they are interested in as the embedded artificial intelligence seeks out content for every user. Family safety mode was introduced in 2020 and allowed parents to control the content children could watch to protect their mental well-being.
Major Products/Services
Brand Take-over
ByteDance’s TikTok offers numerous products and services to the general public, and other than entertainment, it is used as a marketing tool. Influencers, brands, and content creators use the platform for advertising their services. Brand take-over ads are a service that allows users to issue five-second videos that appear whenever the user opens the TikTok app (Green et al. 2022). The service can improve brand awareness and worldwide advertisement, especially for multinational corporations like Amazon.
In-feed Video and Brand Hashtag
The in-feed video ads auto-play between videos as users enjoy the Tik to entertainment. The service allows companies advertising to play their adverts in between entertainment videos. The branded hashtag challenge is an important service that allows companies to have an associated hashtag where they prompt users to create videos promoting a particular brand. Since TikTok has over 2 billion users who visit the site more than two times a day, it becomes more appealing for companies to use the challenge to popularize their products (Peng, 2021). The services and products offered by TikTok allow companies to reach out to billions of users globally and increase sales in due course.
Industry Overview
PESTEL Analysis
Tik Tok operates in the entertainment industry, and within the dictates of the laws in all the countries it operates in. The service strives to create a brand position by navigating through the environment. It attracts content creators and offers them adequate incentives to maintain them. Creating pro-social videos is not the only way the service is flourishing but also navigating the political landscape, like moving the servers to Ireland which is a tax haven to lower operation costs (Ma, & Yu, 2021). Data protection is an outgoing concern maintained in TikTok to remain relevant in the discourse.
Navigating Industry Challenges
TikTok is concerned about the world’s political situations and bans politically biased content and a threat to peace. As environmental forces push TikTok, it uses mergers and acquisitions to reach many global industries. Some threats surrounding TikTok are the privacy policy, regulations, and the Chinese brand associated with human rights violations, leading to the ban of TikTok in countries such as India (Green et al. 2022). However, TikTok enjoys a huge market share, has loyal users, and is free, making it popular with Generation Z.
Competition
Main Competitors
TikTok operates in a competitive environment with other growing companies offering an alternative to the users. Some of the main competitors are Triller, funimate, and cheez, among many others, which provide users with a chance to record and share videos. Thriller, for example, is commonly used by celebrities to share videos and stickers and comment on each other’s performances (Ma, & Yu, 2021). Besides TikTok, the other apps can also modify and share videos. ByteDance must therefore put strategies in place to enable TikTok to maintain its position in the industry.
Competitive Advantage
Strategic management enables TikTok to navigate the competitive environment and emerge victorious. TikTok pays more attention to innovation and technology through artificial intelligence to personalize the app for the users. Further, the company initiates multiple challenges and prompts, allowing everyone to participate regardless of their abilities and talents (Peng, 2021). The service is free; anyone with a smartphone can download and start recording, editing, and posting videos, enabling people to nurture their talents.
Conclusion
The rise of TikTok is an example of how businesses grow in a competitive and dynamic landscape. Despite operating in a highly competitive environment, the management has leveraged technology and innovation to make it easy to use. The company further organizes its content based on age groups, and parents can restrict inappropriate content. The increasing number of users makes TikTok ideal for many companies to advertise their businesses.
References
Green, D., Polk, X. L., Arnold, J., Chester, C., & Matthews, J. (2022). The Rise Of TikTok: A Case Study Of The New Social Media Giant. Manag Econ Res J, 8(1), 33261. Web.
Peng, Y. (2021, August). TikTok’s Business Model Innovation and Development-Porter’s Five Forces Model, Business Model Canvas and SWOT Analysis as Tools. 1st International Symposium on Innovative Management and Economics (ISIME 2021) (pp. 482-489). Atlantis Press. Web.
Ma, J., & Yu, S. (2021, October). The Future Development of E-commerce in Tiktok. In 2021 International Conference on Public Relations and Social Sciences (ICPRSS 2021) (pp. 241-246). Atlantis Press. Web.