The Bill That Could Ban TikTok Has Been Signed Into Law. What Now?
New Engen, Inc.
New Engen is a digital marketing agency driving impact for brands across every phase of the customer journey.
The (Latest) Latest TikTok News
Just weeks after the House of Representatives passed a bill with the potential to ban TikTok in the U.S., President Biden signed it into law. The legislation is part of a wider foreign aid bill that includes funding for Israel, Ukraine, and Taiwan, which Heather Nichols, CEO of Acorn (an influencer-marketing solution from New Engen), believes only increases the likelihood that the app will, ultimately, get banned.
Legal challenges are sure to muddy the waters and prolong the uncertainty around the platform's fate, but the once-hypothetical U.S. TikTok ban feels more like a not-too-distant reality. Here’s our take on the news and how we’re navigating the situation in partnership with our clients.
The Bigger Picture
There is no denying that a ban on TikTok would massively disrupt the modern digital marketing landscape. However, without dismissing TikTok’s indisputable and far-reaching impact, it is important to remember that “TikTok is not the first major platform to (potentially) come and go, and it won’t be the last,” says Heather Nichols. “Brands and advertisers have always found a way to adapt to such changes, but the stakes are acutely high for TikTok creators, whose futures should be central to the wider conversation that will unfold in the months to come.”
Other key stakeholders in this equation include the platforms positioned to fill a TikTok-shaped hole in the social media-verse. Naturally, Instagram and YouTube are the obvious contenders - early projections from EMARKETER estimate that Meta alone could capture as much as 27.5% of TikTok’s U.S. ad revenues. While we’re guaranteed to see new platforms emerge in TikTok’s wake, only time will tell how effective they are at capturing meaningful market share.
No Sudden Moves
The advice we shared in our last TikTok update still stands: prepare your brand but avoid sudden (or dramatic) moves. “At a high level, the approach we’re taking for our clients remains the same,” says Kevin Goodwin, VP of Digital Marketing at New Engen. “We aim to hedge channel over-dependence through a diversified media mix and constant testing. With TikTok averaging 5-10% of media investment across the New Engen portfolio, we are confident in our ability to quickly shift funds with minimal impact to our clients’ businesses.”
If and when budget reallocation is warranted, audience research will be necessary to validate any adjustments to media mix. For many New Engen clients, this scenario would generally see marketing dollars moved to YouTube and Instagram.
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“As the narrative develops over the next year,” Kevin Goodwin adds, "brands need to monitor perception and stay hyper-aware of how they are positioned within the context of the noise surrounding TikTok. New data, studies, and opinions will certainly come to market over the coming year, supporting both sides of the issue. Independent of where the truth lies, brands advertising on TikTok inevitably run the risk of getting caught up in and negatively impacted by the discourse surrounding the platform. While this is not something to act on right now, it is a consideration we will be closely monitoring for our clients."
The Creator Perspective
As mentioned, we are keenly aware of the implications facing creators in the event of a TikTok ban. “During this period of TikTok uncertainty, our focus is on supporting creators who have worked hard to build their livelihoods on the platform. Those who rely solely on TikTok are at greater risk, so we're actively guiding them to mitigate the impact of a potential ban,” says Kelly Dye, VP of Influencer Strategy for Acorn.
Here are three steps creators can take right now, according to the influencer marketing experts leading Acorn:
Ultimately, creators need to be platform-agnostic and prioritize quality content with broader distribution. This approach will help them maintain their audience and thrive regardless of the shifts in the social media landscape. In turn, brands will need to be equally agile and committed to evolving their influencer programs on the road ahead.
We will continue to share our reactions as the story unfolds over the coming months. Stay informed by subscribing to our newsletter and following us on LinkedIn.