TikTok is good for small business. It’s rapidly growing into one of the most used social media platforms. According to Hootsuite, TikTok takes the #1 spot for most downloaded app in over 40 countries. Plus, it’s not just a platform where Gen Z’s enjoy entertaining videos anymore. A study by Statista found that 71.2% of people on TikTok have bought a product they saw on their feed. Another survey saw 30% of daily TikTok users utilize the TikTok Shop.
TikTok is a useful platform for small business exposure. There are many opportunities to get your brand in front of a wide audience. For example, the platform’s algorithm promotes content based on engagements rather than followers. So even with a new or small account, you can go viral if your videos resonate with viewers. Here’s what someone from Reddit has to say:
Another great exposure example is making use of trends. Tapping into popular trends and hashtags can greatly increase visibility and engagement. This will then attract more followers and potential customers.
Brooki Bakehouse is one small business that took off in TikTok. Brooke Saward, the owner, shared fun baking videos and a bit about her personal life. These videos garnered millions of views over time. Today, the bakery has almost 2M followers, lots of faithful customers, and even a bakery class. Brooke says that she never spent a single dollar on marketing. Here are some other success stories from Reddit:
TikTok is a good way to start a business in the creative and entertainment sectors, as well as in lifestyle, education, and technology. It comes with direct sales features, such as TikTok Shop and links to product pages. This makes the purchasing process much easier for customers, potentially increasing sales. However, it does require a bit of work. For one, you must post interesting and engaging videos at least 1 or 3 times a day. Also, competition is getting tougher as small and big businesses are joining in the fun. You need to find a way to stand out. Finally, not all types of businesses do well in TikTok. You'll have to study your target audience and their presence in the app. Here is what one person from Quora has to say:
In this article, we're going to see 5 reasons why TikTok is good for your small business. We'll also look at tips on how to leverage the app, as well as its benefits and drawbacks.
1. TikTok Has Massive, Specialized Reach and Engagement
TikTok has massive, specialized reach and engagement due to its millions of active users worldwide. Plus, its algorithm promotes highly engaging and personalized content. This makes it easier for a wider audience to discover your small business. At 13 years old, Dasha Derkach posted a video on the TikTok app about her scrunchie designs. On that same day, she says 10 people messaged her to order. In 2 months, the video garnered 15k views with 100 orders a week! Today, TikTok provides 90% of Derkach’s Enchanted Scrunch sales.
TikTok impacts small business visibility as it shows content tailored to users’ interests. So even if you have no followers, your video can still appear to people interested in what you offer. You can then turn them into customers with creative and authentic videos.
2. TikTok Can Gain Viral Potential
TikTok can gain viral potential because of its high user interaction. A study by Social Insider found that the average engagement rate per view on TikTok is 5.38%. If you get a lot of engagement, the video will become viral and reach even more people. To make a small business go viral on TikTok, you can:
3. TikTok Is Highly Cost-Effective
TikTok is highly cost-effective as it doesn’t cost anything to post creative videos. You don’t even need expensive equipment to make content that resonates with an audience. Lala Hijabs, one business that started and grew in TikTok, simply used a phone, good lighting, and tie-dyed hijabs.
However, to make your TikTok videos seen by more people, you’ll want to invest in TikTok ads. The cost for this can vary, depending on the type of ad you choose. Even so, it’s still much cheaper compared to other types of content marketing. For example, the Cost Per Mille (CPM) in TikTok is $10, while the CPM in Facebook is $14.9. NestScale provides a detailed graph of the different TikTok ads and their costs:
4. TikTok Offers Targeted Advertising Options
TikTok offers targeted advertising options that can accurately reach the right audience. You can choose to target users by demographic, interest, or behavior. You also have an option to advertise to your previous customers. You may even put out an ad to find new users who are similar to your existing customers. TikTok is a good platform for small business advertising as it has several types of ads:
5. TikTok Is Popular Among Younger Audiences
TikTok is popular among younger audiences who are willing to try out new products and brands. In a 2021 Consumer Culture Report, it was discovered that 58% of Gen Z’s purchased an item they saw on social media. One example of a product going viral on TikTok is the Gummy Mango peelable candy. Since the gummy can be peeled, it made for a great video review that piqued interest. Soon, more and more teens and young adults bought the product to video themselves trying it. Ever since then, stores like Walgreens have had trouble restocking it.
A huge young audience makes TikTok a good platform for small business promotion. This is because engagement and trendsetting are popular among the younger generation. Both of these can boost visibility and influence purchasing decisions.
What Are the Benefits of Using TikTok for Marketing a Small Business?
Success Stories of Using TikTok for Small Business
Bobbie Goods is an artist who found success in TikTok. The funny part is that she didn’t plan on turning her TikTok content into a business. Goods only made it to show off her charming animal hand drawings with music to match the vibe. As her following started to grow, and more people messaging her about orders, she decided to sell her art. Now, Bobbie Goods sells coloring books, stickers, artsy bags, and cards. She has 1.1 million followers on TikTok, thousands of views, and frequently sells out her products.
You can find success with TikTok dropshipping, too. Someone from Reddit was excited to share their success story. Since their niche was beauty, they aimed to attract TikTok's predominantly young female audience. After investing $800 in TikTok ads, they were able to earn $2,600 in just 48 hours. Here is what they had to say:
Crumbl Cookies had a unique strategy to get people raving about them. Every Sunday, they rotate their menu and drop new flavors. They then post their drool-worthy cookies on TikTok. Creating a sense of FOMO, thousands of people rush to get the cookies before they're gone. They also encouraged customers to use the hashtags #crumblereview and #tasteweekly in TikTok. With this, Crumbl Cookies reached 1 million followers in a few days. Today, they have almost 8 million followers and even more views on their hashtags. What began as a small bakery in Logan, Utah has now grown to over 800 stores. Crumbl Cookies is known as the fastest-growing cookie company in the USA.
Is TikTok Useful for Business?
TikTok is useful for business if your goal is to reach a younger audience. Almost half of the users (47.4%) are under 30 years old. What’s more, TikTok is a great place to show your business’ creativity and authenticity. So if your small business is in the creative industry, it’s especially useful to have a TikTok account. Here’s what someone from Reddit has to say:
However, TikTok is not for all businesses. If your target audience is older or more serious, you won't find many of them flocking to the playful app. In this case, TikTok might just be a waste of your time. Here is what another user says on Reddit:
To determine if TikTok is useful for your business or not, you should study where your target audience is. If they can be found on TikTok, then it’s a must to be present there. To give you a heads up, here are some TikTok demographics by Exploding Topics:
5 Expert Tips to Leverage TikTok for Small Business
1. Create Engaging and Relatable TikTok Content
Creating engaging and relatable TikTok content is crucial to grab and hold attention. Remember, TikTok is flooded with videos. What’s more, users are quickly scrolling through their feeds. If you get their attention, they’ll more likely watch the entire video and interact with it. In turn, TikTok’s algorithm promotes content that gets high engagement. The more people you reach, the higher your chances of getting sales.
When planning your video content, keep it short and sweet, fun or compelling, and authentic. One insider secret from the top-performing TikTok brands is to implement these strategies:
2. Utilize TikTok’s Features and Trends
Utilizing TikTok’s features and trends can help you drive sales. TikTok trends are used to increase visibility and engagement. TikTok features support small business growth by allowing streamlined purchasing processes. Here are some of the features you can try out:
3. Engage With Your TikTok Audience
Engaging with your TikTok audience will encourage engagement and build a following. TikTok is effective for small business customer interaction because of its interactive platform. Here are some ways to interact with your audience:
Respond to comments with video replies
Create polls, questions, and challenges
Duet with other videos
Host live sessions
Feature user-generated content so people can create videos related to your brand
Andrea O, the owner of PeachyBBies Slimes on TikTok, did this strategy. She creates video replies for comments about her slime-making process. She even makes new slime scents and textures based on people’s suggestions. This encouraged many people to comment their questions or suggestions. Now, PeachyBBies Slimes has over 6 million followers, and Andrea’s slimes frequently get sold out.
4. Post Consistently on TikTok
Posting consistently on TikTok is crucial for small business success. This is because the TikTok algorithm favors active accounts. If you post frequently, your videos are more likely to feature in people’s feeds. You can then turn those viewers into followers and, hopefully, customers. Plus, it also boosts brand recognition, relevancy, and credibility.
When it comes to how many posts you should make in a day, it really depends. The best approach is to experiment with posting once or a few times daily. Review the analytics to see if posting more increases your likes, comments, follows, shares, and sales. Many small business owners and TikTok themselves recommend 1 to 3 posts a day. Besides that, Hootsuite also gives us the best times to post on TikTok according to their studies:
What Types of Content Are Most Effective for Small Businesses on TikTok to Boost Sales?
5. Leverage TikTok Ads
Leveraging TikTok ads guarantees that your videos reach a wider audience. The best part is that you can choose from several types of ad formats - from basic to fun. You can even sponsor hashtag challenges. To effectively utilize TikTok ads, follow these steps:
Is TikTok Dropshipping a Good Idea?
TikTok dropshipping is a good idea as you don’t need your own products. You simply have to:
Partner with a dropshipping supplier
Create engaging content for their products
Attract an audience
Make customers place an order in your online store or link provided in your TikTok profile
Forward the order details to the supplier. They will be the ones to handle inventory, packing, and shipping
Earn a profit from the difference between the retail price you set and the original price
TikTok actually encourages this. The app has partnered with a few dropshipping platforms, like WooCommerce and Shopify. This makes it super easy to integrate into your TikTok account. You'll be able to start a business in TikTok even without a physical store or products.
3 Major Dangers of TikTok for Small Business
1. TikTok May Face a Total Ban
Many countries, including the USA and the European Union, are considering banning TikTok. This is due to concerns over data privacy and national security. With this threat looming, it's not good to rely solely on TikTok for your business growth and success. So while you can take advantage of TikTok now, remember that it can come crashing down anytime if banned.
2. TikTok Ads Is Expensive
TikTok ads are what drive reach and brand awareness. However, the minimum amount to spend on an ad campaign is $500. If you own a small business, you might not have the funds for that. Plus, if you don't get the point across or your target audience isn't on TikTok, you'll be wasting a big investment. This is why it's super important to consider your brand, target audience, and ad campaign.
3. You May Get Overlooked in the Crowd
TikTok's reputation has expanded beyond dancing trends. According to Capital One Shopping, TikTok shoppers grew 40.5% from 2022 to 2023. With this, more and more small businesses and big companies are flocking to the platform. You’ll have a lot of competition. You may never be able to see growth or success. Although some businesses get lucky, you'll mostly have to find a unique angle to stand out among the crowd. You also need engaging video content ideas, the right target audience, and TikTok ads.
Conclusion: Why Building Digital Assets Is Better Than TikTok Business
Building digital assets is better than TikTok business as there’s less risk and more long-term value. TikTok algorithms, policies, popularity, or bans can greatly impact your business. Meanwhile, digital assets, such as websites or blogs, are owned and controlled by you. Plus, these assets can continue to generate value over time. An optimized website can attract organic traffic for years after it's created. This will bring in new potential customers and reinforce brand authority.
One of the best digital assets is a local lead generation model. Here, you create a website for a service business, rank it with SEO, and rent it to a local business. There’s less risk as the initial investment can be as low as $30 to $100. There’s also less competition as you’ll be targeting local service businesses. Finally, local business owners will be willing to pay $500+ to rent your ranked website. Over time, you’ll be able to earn a passive income of $50,000.
