1 week ago
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The TikTok ban could be catastrophic for Americans.
This crisis has ripple effects that could disrupt industries and shake the American economy. 💰
Aly (my editor) HATES when I do hot takes… but billions per month are at stake, and American small businesses are on the line so I have to share this one.
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Thousands of creators are scrambling to find alternative platforms, and millions who built their livelihoods on TikTok are at risk of losing their incomes. This ban threatens TikTok employees, creators, influencers, and small businesses throughout the entire ecosystem.
This ban could also be a massive stumbling block for a major tech company. And it's not who you think. 😮
I'll drop some insights on what this chaos might mean for long-term Meta investors. (Not financial advice.)
Low key, this TikTok ban is like a soap opera. 🍿
That said, these views are my own, definitely not ZDNET's, and definitely not Aly's.
Quick Intro
If you're new to my work, my name is Lester Mapp. My friends call me Les. 👋
I'm a founder with a successful exit and currently the executive chairman of a group of DTC brands. But at my core, I'm an award-winning performance marketer.
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I've crafted and managed tens of millions in digital marketing campaigns on Meta, TikTok, and Google. 🚀
Needless to say, I have unique insight into what's happening and how this ban will affect small businesses.
BTW, if you're into data-driven marketing insights and strategies, check out my free newsletter, No Fluff Just Facts.
All that said, let's get into the hot take Aly told me not to do. 😅
Let's recap how we got here
The TikTok ban is officially called the Protecting Americans from Foreign Adversary Controlled Applications Act and was signed into law by President Biden on April 24, 2024.
ByteDance, TikTok's parent company, now has a deadline to sell the app to a US-approved buyer or face a ban. 😤
Here is the recap:
Deadline: ByteDance must sell TikTok by January 24, 2025 (or April 24, 2025, with an extension).
Consequence: If not sold, TikTok will be removed from US app stores and banned.
Reason: The law addresses national security concerns over data access and potential influence from the Chinese government.
TikTok saw the new act and said nah and pushed back against it, arguing it violates the First Amendment.
The irony of a Chinese company arguing for the First Amendment is not lost on me. 🙃
On December 6, 2024, the US Court of Appeals upheld the ban.
In response, TikTok said nah again and plans to appeal to the Supreme Court and seek an injunction to delay the ban.
As of December 13, 2024, the Supreme Court has yet to rule, leaving the outcome uncertain.
In addition, TikTok creators are suing the Department of Justice, arguing that the ban threatens their livelihoods, communities, and freedom of expression. 😱
TikTok ban could leave a void Meta won't fill
TikTok has become a critical platform for many creators, with some earning over 75% of their income through the app. 😳
Meta doesn't offer the same programs and support geared toward audience growth and creator revenue, so creators on Meta typically earn less money.
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For advertisers, the TikTok ban is less than ideal; in fact, it sucks.
To understand why, here's a crash course in marketing. Don't worry, I'll keep it as simple as possible.
There are two main stages of awareness:
Intent: When people know what they want and are actively searching for it. This is called product or problem awareness. I know what my problem is, and I'm looking for a solution. Sometimes, this could be problem and solution-aware. Think of when you use Google Shopping. It doesn't get any easier than this for an advertiser because I don't need to educate you… you buy, or you leave. Very straightforward.
Discovery: Picture this: you're scrolling on Meta or TikTok, enjoying the funny stuff on your feed, and boom, you see a very cool widget for a problem you have. With a bit of education, you decide to buy. That's discovery.
Discovery is key to scaling revenue because it introduces your product or service to people who don't yet know they need it. Meta is king when it comes to discovery, but TikTok is gaining ground quickly.
Stay with me; you need to understand this to see the void… ⏳
TikTok provides another platform to showcase products to a new audience at scale. While it isn't quite at Meta's level yet, it is getting there.
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Since TikTok is so effective, running campaigns on both TikTok and Meta together increases overall marketing efficiency for advertisers.
What's also never mentioned is that TikTok's rapid growth forces Meta to step up its game for creators and advertisers.
Without TikTok, I worry Meta will fall back into old habits, ad costs will keep rising, and ad efficiency will drop. 🥺
The biggest winners…
The obvious winners are platforms like Google, Meta, Snapchat, and X. 🏆
Google is sighing relief as 74% of Gen Z users use TikTok for search, with 51% preferring TikTok over Google as their search engine.
Yeah, you read that right; on top of being a social platform, TikTok is also becoming a search engine.
Amazon also stands to benefit.
TikTok Shop has been growing rapidly, and its ability to serve as both a traffic source and a storefront makes it incredibly powerful.
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Overall, I believe this ban will be a net positive for the American people.
I know what you are thinking: "You just said this will cost small businesses billions, plus lead to lost jobs and more." And I feel strongly about that.
However, no foreign adversary should have this much access to American lives. This data includes spending habits, credit card information, shopping preferences, location data, browsing history, biometric data, and even access to camera rolls and microphones. 🔒
Looking at this objectively, we should have never gotten to this point. But that is a rant for another day.
The biggest loser no one is talking about...
ByteDance, creators, and small businesses would bear the brunt of a TikTok ban as court filings from TikTok executives estimate creators and small businesses could lose $1.3 billion in revenue during the first month. 📉
But guess who's probably low-key pissed about this?
Shopify!
Shopify's partnership with TikTok allows merchants to connect their Shopify stores directly to TikTok Shop. It allows business owners to sync their stores, manage ads, access analytics, and use TikTok's shopping features. This seamless integration drives growth for both platforms. 🤝
TikTok's e-commerce goals are ambitious, with a target of $17.5 billion in US sales for 2024. Shopify stands to gain big from that. The partnership gives merchants access to TikTok's massive audience and a new way to drive sales.
TikTok and Shopify are like peanut butter and jelly. One brings the traffic, and the other handles the transactions.
All I am saying is that Shopify is about to take a hit, and no one is talking about it. 🤔
What next?
If you are a creator or small business owner wondering what to do next, I got you.
The obvious answer is to double down on platforms like YouTube, Meta, X, and others. It's decent advice, but more is needed to solve the real problem.
The real issue is that we need to own our audience as marketers, business owners, and creators. Whether through email lists, membership sites, or SMS, the goal should be to own the relationship, not rent it.
Here's the hard truth: if it's not this, it will be something else. The next update, the next algorithm change, the next platform shutdown, something will always disrupt the way you reach your audience.
I've been doing this for a long time, and I can't recall a moment when advertising costs went down. Owning your audience is more than just prudent. It's an opportunity to stabilize costs.
The pattern is clear for 2025: businesses must be media-first to survive and thrive. 📢
What does that mean?
Think about building a community. Think about providing value to your prospects before making an offer. It's about creating content that builds trust, loyalty, and engagement so your audience stays with you, no matter what happens on any platform.
If you want deeper insights on how to make this work, hit me up on LinkedIn.
My two cents
As someone who this ban will impact, I have a mixed bag of emotions. 🥴
As a TikTok Shop operator and advertiser, I wanna cry.
As a Meta advertiser, I'm not happy and will be closely watching ad costs as this plays out.
As a Meta investor, I find it interesting that it could boost the share price.
As a Shopify investor, I'm closely monitoring Q2 2025 earnings if the ban is upheld.
As an American, I like my privacy private, so I get it.
That said, in situations like this, I always remember this quote…
"It's not happening to you. It's happening for you." 🤗
As cheesy as it sounds, that saying has served me well during tough times.
😇 Hope this helps; I'm rooting for you.
P.S. 📩 Want more data-driven marketing insights? Sign up for my free newsletter, No Fluff Just Facts. I share what's working in the world of digital marketing, the latest trends, and the occasional pep talk to keep you inspired. If this sounds like your jam and you wanna be besties forever, click here to sign up. It's totally FREE!
Disclaimer: I hold stock in Shopify and Meta and actively operate a TikTok Shop. This article reflects my personal opinions and insights, which are based on my own experiences and observations in the industry. While I strive to provide an unbiased perspective, my involvement with these companies may influence my views. Readers should consider this context when interpreting the content presented here.
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