Understanding TikTok with the Author of "The Attention Factory"

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Where did TikTok come from? How does it make money? And is it really just a trojan horse to steal your data?


The latest edition of the Asian Local Search and Media Association's Executive Insight Series features an interview with Matthew Brennan, arguably the best person to ask for a primer on TikTok. The series is produced by BigFive Digital co-founder Charles Laughlin.


Matthew is co-founder of China Channel and author of the new book, “The Attention Factory” — an in-depth look at TikTok and its parent company Byte Dance. 


Our conversation with Matthew covers TikTok’s origins, the secrets to its success, how it makes money, and its controversies. In particular, we discussed concerns over the platform's privacy. 


Here are a few highlights from the conversation. 


Is TikTok just fun spyware?


"I think it's totally legitimate if you are concerned about privacy to not use those platforms. It is a trade-off, right? You're getting a free service, which means you are the product."


What is the secret to TikTok addictiveness?


"There's no one reason why this app is where it is today. Technology is definitely very important. So that's one factor. And number two is actually the community they built around it. They're actually very good at fostering user-generated content communities. This company is extremely good at doing that.

 

"Number three, I think, is the growth team. They spent a lot on advertising. In 2018, if you went on YouTube, you couldn't go anywhere without seeing a TikTok ad. So they spent wildly and boldly. In 2018, SoftBank gave them $2 billion. And they spent that on flooding the world with adverts. They used the actual content from the apps. It's a growth hack technique that they have used quite effectively."


Is TikTok a big moneymaker yet?


Not yet, Matthew says. But it is well on its way, with revenue streams from both advertising and transactions. 


“Today, it has got very light monetization, it's really in the early stages. It’s further ahead in Asia than it is in Europe and North America. But even in Asia, it's still fairly early."


How should digital agencies think about TikTok?

 

"The closest paradigm to think about is YouTube. [TikTok] is a short form YouTube. Obviously, it's that's a very gross simplification. But it's a much better way to think about it than saying, this is a Facebook or an Instagram. Because there really is no social aspect to it beyond commenting on other people's videos and liking it. Which is, again, quite similar to YouTube.."



You can view the full interview with Matthew on YouTube.




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