TikTok’s Ad Partners Prepare ‘Contingency Plans’ As Potential Ban Looms

tiktok ad partners QubixStudio/Shutterstock Remix by Caterina Cox

At the moment, it’s fair to say that TikTok is in crisis. The divest-or-ban law made official in April means that a national ban on the app might come sooner than we think. TikTok isn’t taking this lying down as it prepares to sue the US government. But according to the Financial Times, advertisers are already getting nervous.  

What have advertisers said?

In an interview with the outlet, one advertising executive claimed that the looming ban threat is already having a chilling effect on brand expenditure as TikTok struggles to assure brands what would happen if the ban became official. 

“They didn’t have a good answer on how they sell ads in the US right now,” the executive said. “How does anyone believe that they’re going to be able to do what they’re doing in six months time?”

This, the executive added, led to the agency drawing up a contingency plan that included a “kill clause” in the contract to evade financial commitments to TikTok in the event of a ban.

A second advertising executive echoed this sentiment. “Those audiences will go somewhere, and our investment will follow them,” they said. Meanwhile, a third advertising exec said they see “more of a groundswell into the societal impact of the platform.”

“More brands are starting to think about [where the data goes] in terms of the investment, the return that they’re getting,” they said. 

What has TikTok said?

In a statement to the Financial Times, TikTok said: “We continue to see strong growth in our advertising business as brands understand that TikTok drives results and can have a transformational impact on business growth, no matter the size.”

You can read the full article here.

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