TikTok Shop: Fueling Growth and Defying Performance Expectations!

Today, I'm thrilled to present our second newsletter installment of 'Diamonds in the Rough,' where we delve into Discovering Creators, Crafting Success, and Navigating the Creator Economy Together. In this edition, we're diving deep into the world of TikTok Shop and conducting an in-depth evaluation of TikTok creator @Liz_the_clearancequeen.

Let's delve into the insights from the creator's TikTok profile, as shown in the image below.

Quick Stat Highlights:

? Followers (Built-in Audience): 489.2K TikTok followers ??

? Total All-Time Videos Posted: 347 ??

? Total Tik-Tok Lives: 1 ??

? Follower Growth (Past 28 Days): 69K+ Followers Gained ??

? Videos Posted (Past 28 Days): 115 ??

? Total Video Views (Past 28 Days): 687K+ (0.04 Engagement Rate) ??

? Video Likes Gained (Past 28 Days): 25K+ ??

? Gender Breakdown: 82% Female / 18% Male ????

?? (NOW PAY ATTENTION)

Here, we present a sample representation of this creators typical organic TikTok views per video, with the average well below 10K per video.

Now, let's explore the impact of TikTok Shop and the TikTok algorithm, and why it's crucial for every creator to adopt an aggressive TikTok posting strategy.

Here are my key findings:

? Rapid audience growth driven by the discovery algorithm, organic virality, and paid reach enables the creation of scalable and rapid built-in audiences ????

? Passive Residual Omni-channel Growth: The influence of TikTok extends beyond the platform, with a residual impact on subsidiary accounts like Instagram, Facebook, and YouTube. Additionally, it contributes to growth in owned and operated communication databases, such as email subscriber lists, SMS communities, and closed communities. ??????(audiences = money)

? Proven Content Model: The data affirms that creators who consistently produce content increase their likelihood of hitting 'home runs' in terms of virality and reach. ????

??(THIS ONE IS IMPORTANT)

Now, let's examine some TikTok Shop data from August 2023 (30 day sample set), presenting proprietary data from two TikTok Shop-driven partnerships, sharing insights into product promotion, cost of goods sold (COGS), total orders, and total revenue generated.

Breaking Down the Facts:

? 11.4M Impressions Obtained: Contrary to organic impressions, these numbers suggest a significant paid boost. What factors contributed to the elevated views? Was it viral content, TikTok Boosted Products, or allocated paid media budgets? All indications point towards a substantial paid boost. Even at a $20 CPM, this investment resulted in an impressive return of $155,000 in revenue. ????

Considering Free Content and Commission Split: Let's consider a scenario where the content was free, and the promotion happened on a pure commission split of 15% of sales.

Here's the cost breakdown:

? Paid Budget ($20 CPM): Let's round up to $20,000 ??

? Affiliate Commission (15% of Sales): Approximately $23,000 ??

? ROAS (Return on Ad Spend): Roughly 3.5X roughly ??

All of the data above leads me to a slew of questions:

"?? Does audience size even matter for creators on TikTok right now?

?? Is content genuinely the most critical factor?

?? Does having a pre-existing audience truly make a difference?

?? Who will rise as the next valuable creator, and who will lead the way in pioneering growth-hacking strategies within the system?"

Can we say 'Early Meta'?"

Seems like a highly beneficial arrangement. ????

Curious to hear your thoughts! Feel free to drop me an email at [email protected] or PM on LinkedIn.