Here's How You Make Money TIKTOK: A Quick Guide to Understanding Your Business

Have you ever wondered how it works the TikTok social network to generate profits? Being one of the largest and most popular today with over 800 million monthly active users, the TikTok platform has grown into a million dollar industry since its inception.

If you want to understand how TikTok makes money, join us in this quick guide where you can understand its business model and how he is growing every day.

Here's How TikTok Makes Money: A Quick Guide to Understanding Your Business

How and when was TikTok born?

Although today everyone is talking about TikTok, it was not always known that way. It started out as an education-focused social network to share short videos (15-60 seconds long) for users to teach or learn about different topics.

Although this is a great idea from friends Alex Zhu and Luyu Yang, the platform was not attractive enough to the public and after six months of development, they decided to change their approach.

History of the birth of TikTok

Now the goal had changed. The company was looking for a new direction in entertainment and began to see teenagers as the ideal audience in the United States, a market characterized by viralization and the creation of new trends.

This evolution will mix music and videos within the application and this is how Musical.ly is officially born in August 2014. It only took a year for the new social network to be ranks n ° 1 on the iOS App Store and is the most free app downloaded in over 30 countries, including the United States, Canada, United Kingdom, Germany, Brazil and Japan.

In 2016, Musical.ly had reached an astounding 90 million downloads and surpassed 12 million new videos per day. This growth prompted major brands such as Coca-Cola to launch their #ShakeACoke campaign within the platform, which consisted of “user-generated ads”.

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Later the audience is by the Wall Street Journal, which had been acquired by Musical.ly Bytedance Technology Co. for the sum of a billion dollars, thus merging Musical.ly with TikTok and creating the American version of the social network (Musical.ly) and migrating all users to this new one platform called TikTok.

Who owns TikTok?

TikTok china based company called Byte Dance Technology Co. It is led by Yimiing Zhang, an entrepreneur who owns several companies, among which stand out the Chinese real estate search portal and of course Byte Dance.

The owner of this great social network is Yimiing Zhang

Zhang has always been linked to the world of technology. I work as CTO in Kuxun and manages around XNUMX engineers for the travel search engine in China, a company that would later be acquired by TripAdvisor.

It is estimated that in early 2020, Zhang has a net worth of over 6,8 million according to the magazine Forbes. Much of this capital is due to the growth and popularity of Byte Dance.

How many users does TikTok currently have?

Just two years after its official launch in 2016, TikTok had reached 500 million users worldwide. After four years, we can say that it has exceeded 800 million monthly active users worldwide.

The most remarkable thing about this is not just the number of users, but that about 150 million of these users are found in China alone. It is important to clarify that in this Asian market, TikTok has its exclusive version called Douyin.

Currently, the app has over 800 million active users and it is estimated that it will continue to grow.

This popularity has led it to become one of the most downloaded apps in recent years on the Google Play Store and the Apple Apps Store, reaching over 2 million downloads between the two platforms.

Only within the framework of this year 2020, TikTok has become the most downloaded application in the world, surpassing 115,2 millions of downloads, realizing an increase of 98,4% compared to the same period a year earlier.

We think that 41% of the population current of TikTok is made up of young people and adolescents aged 16 to 24 year-olds. This is mainly due to its design and functionality, which was already studied by developers when choosing their target audience.

How does TikTok make money?

According to data provided by CrunchBase, TikTok can generate up to a million dollars a year. This figure is possible thanks to coins and digital gifts from The platform that users use, while monetization systems are being set up.

To be clear, the way TikTok earns money goes through shopping integrated related to parts. These have a cost of 100 pieces - 1,09 ?? to 10 pieces - 000 ??.

For now, TikTok is making a profit from coins through commission fees

These coins are used by users who consume the content and granted to creators as a method of appreciation or compensation. According to Sensor Tower reports, about $ 3,5 million is spent per month by users around the world in in-app purchases.

In addition, the company has preset to charge a certain commission for these types of transactions, 30% goes to the servers of the store where the app is stored, 20% at TikTok and the remaining 50% to the content creator.

Although the annual income seems low, the truth is that TikTok is more focused on massive growth and the reach of large masses than on monetary gain, this can be demonstrated through statistical data.

What future awaits TikTok?

For the moment, the future of TikTok is quite bright. Today, no application can handle it in your industry. Such is the case, that Facebook recognized its growth, it even developed Lasso, an application similar to compete with TikTok and stand up to him, however, he has was closed on July 10, 2020.

Good times ahead for TikTok

Likewise, the reach and positioning of this social network are very solid, mainly among young people around the world. This is reflected through the advertisements promoted on Facebook, YouTube and even Google, where it is possible to show the direction of the market they want to conquer.

The point is that more and more millions of young people and users in general are joining TikTok and, thanks to its growth and consolidation in such a natural way, can make us believe that it is unstoppable.

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