Advertisers scramble as TikTok faces possible US ban

As a potential US ban on TikTok looms, advertisers dependent on the platform are scrambling to prepare contingency plans. With a January 19 deadline for ByteDance, the Chinese parent company of TikTok, to sell its US assets or face a ban, many marketers are facing the reality that the app may soon be inaccessible. This has led to a sense of urgency, with some industry professionals describing the situation as a “hair on fire” moment.

TikTok, which has become a key player in US digital advertising, particularly among younger audiences, may lose over $11 billion in annual ad revenue if the ban goes through. Most of this ad spend would likely shift to platforms like Meta’s Instagram and Alphabet’s YouTube Shorts, where many advertisers are already established. Despite the uncertainty, TikTok continued to pitch new advertising features and planned its presence at major global events like the World Economic Forum in Davos.

In the face of potential shutdown, many influencers and brands are downloading their data in a last-ditch effort to preserve content and advertising materials. TikTok has offered favourable refund terms to advertisers, though some still question the platform’s future in the US. This heightened uncertainty marks a stark contrast to the optimism advertisers held just weeks ago, when many expected a resolution before the ban could take effect.

TikTok’s growing influence in US advertising, particularly in e-commerce, has been notable, with ad spending on the platform increasing rapidly. Despite challenges, the app’s powerful ability to drive sales through influencers and short-form video content has made it a favourite among advertisers looking to tap into the youth market. As the deadline approaches, all eyes are on whether the incoming administration will intervene to prevent TikTok’s shutdown.