The WSJ has released a report revealing the latest financials of TikTok’s parent company Bytedance, detailing just how expensive going viral really is.
Hockey stick growth, and costs
Of all the mind-blowing numbers released, the one that stood out most is ByteDance’s marketing spend where, all told, the company spent $19.2bn last year. That’s about $5bn more on marketing than even Meta spends, a company that’s part way through a massive rebranding and has captured the largest social media audience on the planet via Instagram and Facebook. ByteDance's level of spend on user acquisition is truly unprecedented — the marketing spends of Snap, Twitter and Pinterest combined are just one-seventh of the Chinese company's budget.
Spend it to make it
Impressively, ByteDance are seeing a real return on those marketing dollars. Revenue jumped 80% last year to more than $61.7bn — and it’s easy to understand why they're in a big hurry to get to scale, as social media competition seems to be heating up again after years of little innovation.
Meta has been pouring resources into Reels, their direct competitor to TikTok, and YouTube has introduced YouTube Shorts to attract fans of the short-video format. Even smaller apps like BeReal are gaining traction with those tired of airbrushed Instagram pics. ByteDance signed up for the ‘outspend to outcompete’ seminar, and it’s working.