How Much are Brands Really Spending on TikTok Ads?

TikTok has only been in the advertising game since 2019, but the platform is already taking up a growing chunk of digital ad spending in the US.

According to figures released by eMarketer and Insider Intelligence, TikTok ad revenue is expected to account for 2.4% of digital ad spending in 2022, compared to just 1% in 2021. Total revenue is projected to hit more than $11 billion by 2024 and take up 3.5% of digital ad spending.

A chart showing TikTok ad revenue

The numbers show that TikTok has proven itself as a must-have destination for digital ads. 

TikTok ad spending in context

While TikTok ad spending is certainly on the rise, it still hasn’t reached the level of the giants that are Facebook and Instagram.

According to eMarketer, Instagram is at the top of the pack for US ad revenue for 2022, at $29.79 billion, with Facebook close behind, at $25.75 billion. YouTube is next, at just over $8 billion, followed by TikTok.

Twitter, Snapchat, and Pinterest all sit below TikTok in terms of revenue, at $3.01 billion, $2.72 billion, and $2.29 billion, respectively. In fact, TikTok is expected to take in more than Twitter and Snapchat combined for 2022.

TikTok is currently the third-largest social media app in both the US and the world, and reached one billion active users worldwide in 2021. While Facebook and Instagram still lead digital ad spending, rising costs and uncertainty amid changing privacy policies certainly makes TikTok an attractive alternative for testing out new strategies.

Users are increasingly spending more time on TikTok than on other platforms. Adult users spend an average of almost 46 minutes on TikTok each day, on par with YouTube, compared to 30 minutes each on Facebook and Instagram.

TikTok marketing is a new frontier, but if you can crack the code, it’s a potential gateway to a captive young audience that’s eager to shop.

Ready to create your business? Start your free 14-day trial of Shopify—no credit card required.

What you need to know about advertising on TikTok 

One of the reasons TikTok is such an attractive platform for brands is the demographics of its users. TikTok has 386.6 million users aged 18 to 24, making up 43.7% of the platform’s users worldwide. The next biggest group is 25- to 34-year-old millennials, who make up 31.9% of the user base. They also skew female, at 57% of the total.

Plus, TikTok users largely don’t mind ads—they even like them. According to DISQO research, two out of three TikTok users chose a positive word to describe ads on the platform, such as “fun and engaging,” “trendsetting,” and “inspiring.”

Combine all that with the fact that one in four users globally have purchased or researched a product after seeing it advertised on TikTok, and you have a recipe for reaching a particularly coveted group of potential customers. 

However, getting their attention takes some work. On TikTok specifically, authenticity is key. Users, especially younger ones, want to watch ads that blend seamlessly into the existing culture on the app, including popular audio clips, viral jokes and memes, and familiar faces. That’s why many brands choose to work with influencers or play into existing trends on the app.

If you’re looking to start advertising on TikTok, it’s best to spend time on the app to develop an organic approach. You can also read our guides below to find out everything you need to know about advertising on TikTok.