What Is TikTok, How It Operates, and Why Is It So Popular?

TikTok is a well-known social media software that lets users make, view, and share brief films captured using webcams or mobile devices. It was first introduced in September 2016. The application is well-known for its high levels of engagement and highly addictive nature, including individualized feeds of humorous short videos accompanied by music and sound effects. However, because of worries that the Chinese government would use it for propaganda and to gather user data, its Chinese ownership has also increased controversy. Legislation enacted in April 2024 and signed by President Biden will prohibit TikTok from operating in the country unless its parent firm, ByteDance, buys it within a year.

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Comprehending TikTok

The short-form video style of TikTok is ideal for humor and amusement. Nevertheless, infotainment is using it more and more. Influencers that build a consistent following on TikTok share self-promotional content mixed with brief words of wisdom. Cooking, personal economics and budgeting, beauty, and fashion are all popular subjects for educational videos. The format is being utilized more and more to market and sell goods.

In a flash, TikTok, which debuted in its current guise in 2018, became one of the biggest social media platforms. It has been downloaded around 4.7 billion times as of February 2024.

Similar to other social media platforms, TikTok has been the focus of ongoing worries around the possible exploitation or abuse of the personal data it collects from its users. Due to Chinese ownership controlling the bulk of TikTok, it has drawn special attention.

The Release of TikTok

The brief nature of the films is implied by the name TikTok. Known as Douyin in China, it was introduced in September 2016 by ByteDance, a startup business. Its 200 million+ accounts were transferred to TikTok after it purchased Musical.ly, a competitor app, in late 2017. This marked the beginning of its exponential rise in usage.

Based on the private sale of a tiny portion of the firm, ByteDance was allegedly valued at up to $140 billion by the middle of 2020. TikTok was worth $66 billion in 2023. In such case, it would rank as the world’s most valuable startup.

The Business of TikTok

Although TikTok marketing is still in its infancy, an increasing number of firms are keen to work with brands to produce the type of humorous content that attracts clicks on the platform. Traditional marketing that highlights a product’s advantages is ineffective.

Rather, companies register user profiles on TikTok and submit mini-videos in the same way as any other user. In order to get more consumers to watch their films, they may also pay. The ultimate objective is to become viral, ignite momentum, and attract a sizable audience to the brand’s message. Lighthearted, entertaining ads with music fit the bill.

Several of the most effective TikTok marketing initiatives include:

The Chipotle restaurant company encouraged TikTok users to dress up for the occasion and share their photos with coupons during its “Boorito” Halloween coupon giveaway promotion. There were 4 billion views for the campaign.

#eyeslipsface is an online reality show and contest that e.l.f. Cosmetics created in collaboration with a few social media personalities. As of January 2024, the advertisement campaign had 10.4 billion clicks.

As of May 2024, the NBA has amassed 21.7 million followers since creating an account. Its goal is to raise awareness of the NBA across the world, especially among youth.

In addition to offices in New York, Berlin, Dublin, Jakarta, London, Paris, Dubai, Seoul, and Tokyo, TikTok maintains its headquarters in Los Angeles and Singapore.

TikTok’s revenue is largely derived from in-app purchases, just like that of many other social media platforms.

Which Business Owns TikTok?

The Chinese technology company ByteDance is the primary owner of TikTok. In late 2020, under pressure from the Trump administration, ByteDance consented to form TikTok Global, a new business venture with Walmart and Oracle serving as its U.S. partners and minority shareholders. That transaction was never completed. A recently enacted federal legislation mandated in 2024 that TikTok either shift ownership or risk being banned from the United States.

How Can I Purchase TikTok Stock?

You cannot currently do so since ByteDance still owns all of TikTok privately and entirely. That might change if the corporation, or a portion of it, is split off due to pressure from the United States at this time.

Is TikTok blocked?

TikTok is prohibited in Pakistan and India as of 2024. After a temporary restriction, it was allowed again in Bangladesh and Indonesia, among other nations. If the corporation doesn’t spin off by the date set by Congress, which is expected to occur in 2025, it will be prohibited in the United States.

The Final Word

TikTok is an immensely popular online application around the globe. However, the ownership by China has proven to be problematic, resulting in many prohibitions and threats of bans, the most recent of which was in the US.