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TikTok has been an unstoppable force that has brought in influencers and entertainers to its platform ever since its boom. Back in October of 2020, TikTok revenue reached a jaw-dropping 115 million dollars from in-app purchases alone.
86 percent of that revenue was accumulated from Douyin, the Chinese version of TikTok, while 8 percent was generated from the United States. TikTok has ranked number one on the top-grossing non-gaming apps worldwide during October with YouTube a decent length away with 94 million in revenue.
October’s statistics have preemptively determined who reigns supreme on these leaderboards in the first half of 2021 as TikTok continues to hold the first place spot in both top-grossing non-gaming apps and most downloaded apps.
How Does TikTok Make Money?
Before we delve further into statistics, you may be curious as to how TikTok makes money. Because TikTok is a free-to-download app, the company must resort to generating revenue through in-app purchases, partnerships, and advertisements.
Users can purchases bundles of coins that can be gifted to content creators as a form of appreciation. The bundle prices can range anywhere from 99 cents to 249.99 dollars in USD.
If you’re interested in purchasing coins on mobile, click the three lines on the top-right of your profile page screen. From there you’ll hit Balance and click the recharge button next to your coin count.
Available options for purchasing TikTok coins. Credit: Brianna Borik
TikTok is partnered with several famous companies to deliver the best experience for users and creators alike. On May 6th, 2021 TikTok introduced the TikTok Developers Program for aspiring creators wishing to establish a presence on this fast-growing platform.
Isaac Bess, the Global Head of Distribution Partnerships on TikTok, said in the post that “As TikTok becomes increasingly ingrained in our culture, more third-party apps across a variety of categories and use cases are looking to tap into our community on their platforms.”
Bess continues by introducing different kits available to creators who wish for solid integration and easier access to tools to help reach their desired audience and encourage creativity within the community. TikTok has several partnerships from the Sound and Login kits alone:
- Audiobridge: An easy-to-use multi-track recording studio for those interested in creating music.
- Allstar: A site designed to post gaming content and, more recently, music and songs.
- IRL: A site where a user can join groups and make new friends online.
- MeetMe: Another app where you can start romantic relationships and discover new friends with similar interests as you.
- Streamlabs: A site that provides aspiring streamers with tools to grow and monetize their content.
- Burpple: A place where Singaporeans can find places to eat.
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TikTok also makes money off of advertisements through their TikTok for Business Program. Released in June of 2020, this program allows creators to set specific marketing goals, create an audience, create budgets, and have the creative freedom to make advertisements.
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According to Entrepreneur 360, brands like Calvin Klein, the NBA, and The Washington Post have begun to advertise on TikTok as of April 2021. The Entrepreneur goes on to say that although the pricing of the advertisement has not been specified, resources claim that pricing begins at 10 dollars per 1,000 views and requires a minimum of $500.
Looking to advertise your brands on TikTok? Check out this blog for some strategies that’ll help you reach your designated audience.
TikTok Revenue Compared to Other Platforms
It’s clear that TikTok has far exceeded the amount earned compared to its competitors. Sensortower is well-known for its statistical knowledge of what apps are booming each month. On June 28th, the website posted an update declaring the top-grossing apps, TikTok and Youtube comfortably taking the first two spots.
Sensortower states that TikTok has earned about 920 million dollars during the first half of 2021. Far behind TikTok is Youtube with about 564.7 million dollars in revenue – still impressive, but nearly half of what TikTok consumers spend.
Trailing behind YouTube is Tinder with about 520.3 million dollars earned in consumer spending. Piccoma, a Japanese manga subscription platform, and Disney+ rest at number four and five, though their estimated amount of revenue is unknown, according to Sensortower.
Top Grossing Mobile Apps for the first half of 2021. Credit: SensorTower
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Top Grossing Mobile Games and TikTok
Although TikTok revenue is dancing around 1 billion dollars with the second half of the year in motion, some top-grossing gaming apps have already passed this incredible milestone.
Honor of Kings is a mobile multiplayer online battle area, otherwise known as a MOBA game, which has racked in over 1.5 billion dollars in the first half of the year. PUBG Mobile is ranked number two in the top-grossing mobile apps and, similarly, hit 1.5 billion dollars in revenue.
Sensortower says to take these numbers with a grain of salt as these numbers don’t take into account the money earned from third-party Android stores in China.
So what does this mean for TikTok? One thing is for certain: TikTok is still a powerhouse among apps on the Google Play and Apple App store and may even surpass the numbers from the two top-grossing mobile apps in the near future.
Because mobile apps are tailored around in-game purchases, it’s no surprise that TikTok – which has content accessible for all users – would be bringing in less revenue for in-app purchases.
The Future of TikTok Revenue
As of June 2021, SpendMeNot states that TikTok revenue from in-app purchases has increased by 74 percent. Likewise, from January to April of 2021, 176 million new users joined the TikTok hype train.
TikTok has been an unstoppable force this past year. Check out this blog to see how TikTok impacted the way viewers saw The 2020 Tokyo Olympics.
The forecast for the rest of 2021 shows that TikTok will continue its upward trend in popular culture and stay as the dominant force on the internet. TikTok revenue will continue to exponentially increase as more users join. So, with these statistics, this means marketers are running over to TikTok to advertise their brands, right?
Well, that’s not entirely the case. SpendMeNot says that only 9 percent of marketers take advantage of TikTok while 68 percent don’t plan on using the platform in the next year. If you plan on kick-starting your business, advertising on TikTok may be your best bet because it seems like the competition is scarce compared to other platforms.