TikTok Advertising Cost: How Much Does It Cost Running TikTok Ads

TikTok Advertising Cost
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The social media space is to our generation what the village square was to our parents’ generation and what the caves were to their parents. Today the best marketplaces are on social media.

TikTok makes the list of the best market places to advertise your business on and expects massive conversion and sales. However, effective TikTok marketing depends on the advertiser’s TikTok advertising cost.

Within a space of six years, TikTok has shattered the glass ceiling in the social media marketing space to climb to the top spot to rival video giant companies like Facebook, Instagram, and YouTube.

As a marketer, it comes as good news to you that TikTok is now a global platform, not just in terms of cultural relevance, but also as a real marketing booster.

Tik Tok marketing is a super great way to connect with Zoomers and promote your products online. It is a largely untapped marketing platform that can help your business reach new customers while retaining the existing ones.

The video app platform has been downloaded over three 3 billion times globally as of June 2022, making it one of the most-downloaded apps worldwide.

This tells you that Tik Tok is the new gathering place for users and advertisers making it a perfect market where you can put products in front of your target audience.

Every advertiser wants to be in this place we talk about now. And when you want something, you must be willing to pay the cost to have it. Advertising on TikTik has its price tags too.

When it comes to TikTok advertising cost, many factors determine how much you are going to put into your Tik Tok ad campaign.

Here are the key factors when considering to go TikTok, they include an ad objective, a bidding method and amount, and the audiences.

So let`s dive in to find out how much it costs to put your products in the face of your target audience using TikTok advertising.

How much do TikTok ads cost?

Considering that TikTok advertising costs is not made public, we are leveraging a leaked TikTok investor pitch deck that revealed that big campaigns can range anywhere from $25,000 to $150,000 depending on the type of campaign you are out for.

For self-service ads, TikTok requires a base budget of $500 for all-inclusive campaigns, with a $20 minimum bill for ad groups. This minimum permits you to see results and ensure that your ads can reach your objectives.

Sadly, if you’re looking for solutions with low costs and predictable results, TikTok probably isn’t your best bet at this moment.

Just like we have mentioned earlier, the pricing of TikTok advertising is mainly determined by certain factors.

This means that TikTok advertising costs aren’t fixed and each ad campaign has its cost based on specific determinants. However, on average, advertisers on TikTok pay around $1.00 for each click and a CPM of  $6.06.

Take note that this figure is generated through a collection of analyses of some advertisers, so this cost as reflected here is not the case for every business.

However, keep in mind that TikTok requires a minimal budget of $50/day at the campaign stage and $20/day at the ad group stage.

Note again that we have already mentioned that four elements greatly influence the costs of your TikTok advertising cost including your ad campaign objective, your audience segmentation, budget & bid amount, and the CTR.

#1. Ad Campaign Objective

The most crucial aim of advertising is to draw awareness to the existence of a product. An advertising campaign needs to capture the attention of people and make them aware of a product and its proposition and the value it holds in stock for the prospective consumer.

The campaign objective defines what your ad campaign aims to achieve, it is conversions, video views, awareness, app installs, traffic, or lead generation. It is what you want people to do when they stumble upon your ad.

Choosing the right campaign objective is crucial when setting up TikTok ad campaigns. TikTok recommends starting with an aim that will earn at least 50 events during the first 7 days, which will allow TikTok to have sufficient data to get your ad out of the learning curve.

Just like on other platforms, you will witness lower CPCs and CPMs when optimizing for an objective that’s higher in the funnel vs. optimizing for a lower-funnel event, However, the CVR will be higher when optimizing for the lower-funnel events.

TikTok Advertising
Image credit: T2M New media

Which objective is right for Your campaign?

Many advertisers would be tempted to choose “all of the above” as their campaign objective, but hell no, that won`t be a nice ad strategy.

A nice strategy would be narrow your focus to the essential results you want to achieve. Aim at a target, don’t aim to shoot all the birds in the sky with a shot.  

There are no hard and fast rules to this but you need to be seen doing the right thing so that you can get the right outcome. To do this, identify and fine-tune your preference with the following questions:

What are my business goals? Which objective complements these goals the better?

When you are done with the answers for that phase, think about your target audience. Where are they on the customer journey? Are they already familiar with your brand? If not, you might want to extend your Reach.

Have they heard about your brand and want to learn more? Have they considered your brand and are now thinking about making a purchase or signing up? If yes, then go for the Conversion objective to convert these into your brand customers.

Do you want to exhibit your brand’s identity and help customers get to know you better? Video Views are great for conveying your brand’s style, vision, mission, and Unique selling proposition.

Or the goal is to keep your brand at the top of people’s minds? Reach objective works super great here, even for well-established brands.

Is your brand new on the market block? Awareness campaigns can lay the groundwork to get the most out of future Conversion campaigns.

Lastly, what’s your budget? Knowing what you intend to put into your campaign can help you make great decisions about the objective to pursue.

#2. Budget & Bid Amount

The budget is the total amount of money you are willing to invest into running an ad campaign. It is a great tool for cost control when planning your TikTok ad campaign.

While budgeting is used to control the overall costs for campaigns and ad groups, bidding is used for managing just the cost per result at the ad level.

You can regulate budgets for both campaigns and ad groups. There are 2 types of budgets, lifetime budgets, and daily budgets.

When setting the budget at the ad group level, you can decide on a cost cap or the lowest-cost bid. The cost cap ensures that you never pay above your bid amount for the particular action you are optimizing for.

Put in mind that once you publish your campaign, you cannot alter or make any changes to the budget type at the campaign or ad group level.

In essence, you will not be able to switch from a daily budget to a lifetime budget and vice versa once you set it.

Budget and bit in TikTok Advertising
Image credit: Pixabay

#3. Audience Segmentation

TikTok recommends integrating your audiences as much as possible by either placing all of your interests into one audience or running the ad group with no interest targeting and letting the TikTok analytical perform its role to serve the ad to the user who will probably take the desired action your optimization.

However, for some businesses, audience segmentation is crucial as they need to focus on a specific niche.

If this is the case with your brand, you can anticipate a little bit higher CPCs and CPMs than campaigns targeting large and scattered audiences.

Audience Segmentation TikTok Ads

#4. CTR & Creative

Lastly, the most crucial factor when you need to control TikTok advertising cost is the ad creative. While TikTok users are more engaged in the video ad than users of any other social advertising platform, the average CTR on Tik

Tok is normally a little lower than the CTR on other social media advertising platforms.

To maintain a beneficial CPA, you will want the video CTR to be higher than 1% on your ad. Once the CTR begins to drop lower than 1%, your costs will rise, which is how you know it’s time to roll in a new creative.

With every advertising campaign battling to win the attention of your target customers, you should not be found sleeping when you need to drag in new creatives to continue being on track in your advertising journey.

 Companies that Pay to Advertise on TikTok

#1. San Diego Zoo(@sandiegozoo)

In the quest to engage its diverse market with informational and entertaining animal-themed video content, the San Diego Zoo took a leap and landed its brand on TikTok and turned its page into a virtual zoo where they showcase videos highlighting the lives of different animals.

This content inspires followers to connect with wildlife and care about preserving the planet.

Beyond simply building brand rapport, the main objectives for launching their TikTok account were

Inspire the next generation of conservationists with fun, educational, shareable content that resonates with a zoomer audience and beyond, exhibiting the key importance of wildlife conservation.

And to also earn added revenue to sponsor conservation missions.

#2. Scrub Daddy (@scrubdaddy)

Scrub Daddy, the happy face-shaped dish scrubber has a series of “unhinged content” where a massive version of the shining yellow scrubber goes on adventures.

The videos are snappy, weird, hilarious, and random, calling people out for washing their dishes with other products.

I forgot to tell you, they have about 1.6M followers. Does that indicate that their ads are paying off? Yes, they do.

#3. Victoria and Albert Museum (@vamuseum)

The latest museum to take advantage of the TikTok platform is the Victoria & Albert Museum (V&A) for Fashioning Masculinities.

The V&A’s Fashioning Masculinities TikTok event did a remarkable job at spotlighting LGBTQ+ influencers and, in turn, LGBTQ+ voices.

On the platform, the hashtag #fashioningmasculinities had more than 560.3K views, with many videos including hashtags like #lgbt.

The objective of the campaign was to grow the V&A TikTok channel, build relationships, and raise awareness of the exhibition within new, diverse, zoomer audiences.

The museum created content that’s both educative and easy on the eyes. They’re uncompromisingly niched and have mop up over 20K followers who love them.

#4. Heider Real Estate (@heider_realestate)

Heider is writing the playbook for the entire Real Estate Industry with its captivating Tik Tok ads.

TikTok users fall head over heels in love with exceptional aesthetics. Heider Real Estate is capitalizing on this knowledge it has of the TikTok User and they are always pushing out their jaw-dropping home tours in clean and clear videos.

Aside from being stunning and catchy, Heider Real Estate’s TikTok videos do something that other brands should emulate. They keep their content moving at a breakneck pace.

From beginning to the end, their videos are engaging, which should be the mark of all your brand’s TikTok content.

These innovative efforts are racking up over 3.3 million followers for the firm and hundreds of millions of views on all their content.

#5. Chipotle (@chipotl)

A few brands have adopted TikTok so well. And Chipotle is one of them

If you have seen any roundups of the best brands on TikTok, Chipotle most likely would be among them

And one of the main ways they have boosted their following on the platform is by prioritizing partnerships with other famous creators. Since 2019, the brand has been investing massively into TikTok advertising.

By working with comical creators, they build their brand by association and reach audiences with a similar sense of humor.

Are Tik Tok ads worth it in 2022?

TikTok ads are worth it if you’re a brand selling physical products that are visually appealing. In this context, most people go to TikTok to buy Cosmetic Products. Makeup is undoubtedly one of the most talked-about trends on TikTok, with over 230 billion views on the app. It has become a marketplace for inspiration.

It is the reason we don’t recommend Tik Tok ads for every brand, however, as a rule of thumb, if you are selling to consumers then you should advertise on TikTok.

From Kitchen Appliances to stationery, down to cleaning Products, Tik Tok is the ads platform to be on if the goal is to gain more visibility and sales.

Conclusion

TikTok is a short-form video-sharing app that allows users to create and share 15-second videos on any topic. You might have known it as that app your niece, sister or daughter uses to post dance videos.

If that is the impression, you are not far from the truth but very far from what the platform has evolved into.

Today, Tik Tok is the goose that is laying the golden eggs for advertisers on the social media space. It is where the world’s attention is.

The glamour for TikTok by businesses is nothing other than a large number of active users on the platform.

It’s still uncertain exactly how the algorithm works but it appears to be much easier for your content to spread on TikTok than on other social media platforms.

For this massive virality, advertising on the platform comes with a cost too, however, Tik Tok advertising cost is not fixed. This implies that Tik Tok advertising cost varies from one campaign to another.

This means too that you can alter the amount you spend on promotions. However, on average advertisers on TikTok pays a cost of $1.00 per click and a CPM of $6.06.

Note that these amounts are produced by a consolidated study, everything being equal, so these costs as reflected here aren’t true for all organizations.

TikTok requires a minimum financial plan of $50/day at the mission level and $20/day at the advertisement campaign level.

Nonetheless, four factors hugely affect your TikTok promotion costs, including your campaign objective, audience segmentation, spending plan, bid sum, and CTR.

Eugene Agoh

Eugene Agoh

Co-founder at AdsTargets | Online advertising expert | Search engine optimisation expert | Social media marketing expert. Eugene is a Passionate writer on topics relating to online advertising, branding and generally interested in creating digital marketing content. He is curious about the future of digital advertising. Follow Eugene on LinkedIn @ eugeneagoh

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