Ecommerce brands spent 60% more on TikTok ads in Q2

Ecommerce brands spent 60% more on TikTok ads in Q2

Online retailers may soon see TikTok surpassing Facebook and Google as the most lucrative advertising channel.

Results from a recent survey of 5,000 online stores found that ecommerce brands spent 60% more on TikTok advertising in Q2, for a total of $29.9 million.

Interesting facts. Overall ad spend across the 5,000 online retailers rose by 11% in Q2 to a total of $529.7 million.

  • Retailers with revenues between $1 million and $5 million are contributing to the biggest increases in ad spend
  • In the first two quarters of this year, retailers spent a total of $48.4 million on TikTok ads – which was a 231% increase over the previous 6 months
  • CPMs vary by industry. Baby, books and collectibles niches have a CPM below $10, while health & beauty & digital products are over $14 CPM
  • Stores with over $25 million in sales have the highest average order values and ROI

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Where does TikTok stand. The same survey concluded that although TikTok is growing in popularity for retail brands, it's still trailing behind Facebook and Google.

  • Facebook is still the top choice for ecommerce advertisers, spending about $377 million in Q2, but only grew by 5.6% from Q1
  • Google grew 20.5% in Q2 and brings in $118.9 million in D2C ad spend
  • Snap declined 10.8% in Q2 with a total ad spend of $2.9 million

Read the full article. You can read the full analysis from MediaPost here.

Why we care. Ecommerce brands and advertisers that are looking to expand their ad strategies may look to TikTok for the solution. However, once an underutilized platform with cheap CPMs, you may find now that with increased demand comes higher costs. Nevertheless, given its popularity, brands that aren't taking advantage of TikTok are likely leaving a lot of revenue and opportunity on the table.

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