TikTok Is Breaking the Traditional Digital Agency. Here’s How.

Last year, TikTok made $4 billion in ad revenue. In 2022, that number is expected to jump to $11 billion. As companies like YouTube see their advertising earnings dwindle, TikTok’s ad revenue will account for 2.4% of this year’s total digital ad spend—up from 1% in 2021. The changing landscape coupled with TikTok’s ever-growing user base has forced digital marketing agencies to shift their strategies.

According to Ethan Curtis, the founder of TikTok marketing agency PushPlay, larger agencies are being forced to hire pre-existing teams dedicated to developing short-form content.

“These bigger agencies are slower because they're having to totally rehire the creative departments or acquire smaller agencies like mine,” Curtis says. Adding that much of the company’s early business consisted of completing projects for bloated agencies not yet familiar with the speed of TikTok trends.

To that end, Curtis says, says more traditional content approval methods—some of which involve multiple teams having to sign off on a piece of content which could take days—struggle to keep up with TikTok’s quick trend turnover. Adding that a song that trends one week can become irrelevant within the next, a reality most TikTok native creators already know.

Which is why some agencies are even hiring people just to consume content and assess trends.

“It is forcing brands to rethink their content approval and scheduling process—there needs to be room to just cut and post stuff on the fly,” Curtis says. “A lot of brands aren't set up that way.”

Kellis Landrum, co-founder of True North Social, says that while clients of his digital marketing agency aren’t turning away from platforms like Instagram, there’s a heightened awareness of TikTok—at least 70% of True North’s new business inquiries involve the short form video hosting service.

Though Landrum stipulates that, TikTok is “probably one of the most important things that we're working on right now.” True North hasn’t hired a team directly dedicated to the platform. Instead, the digital agency has incorporated TikTok production into its pre-existing social team. Part of this is due to TikTok’s rapid growth; TikTok lacks detailed data analytics and content scheduling tools that other platforms have. Because of this, Landrum says many agencies are still honing their strategies as the platform evolves.

True North has however reprioritized how it creates content for clients. On top of outsourcing some videos to influencers, he says one method involves producing longer videos that are then chopped up into smaller bits to be distributed on TikTok. He says the switch to video requires more effort than the early days of social media marketing—just a few years ago, one photo shoot could produce months of content for Instagram. Now, he says agencies have to put in more day-to-day production work as they create individual short-form videos.

Part of that production work includes trying to recreate the lo-fi aesthetic that comes from filming videos on a phone, that’s native to TikTok. But as more money is poured into TikTok marketing, Landrum also believes that ads will become more elaborate and have higher production value.

“Over the course of time, TikTok videos will start to become more produced as people can make more money off of them and the stakes get higher,” Landrum says.

Even as content becomes more produced, influencers remain at the core of many marketing agencies’ strategies. Aaron Cuker, CEO of digital marketing agency Cuker, says that since most of their clients view TikTok as a priority, his company integrated the platform into its pre-existing social team and expanded its influencer roster to include TikTok creators.

Part of TikTok’s marketing power is due to the platform’s algorithm, which Cuker says reaches a wider audience and increases conversion rates. Cuker says TikTok has reshaped the traditional path-to-purchase for customers as the algorithm exposes an extensive number of users to new brands and products.

“What once was a linear sales funnel, is now an infinite loop of consumers entering, exiting, and re-entering the sales journey based on various wants and needs,” Cuker says. “TikTok lies at the forefront of this new era for brand discovery and new customer acquisition.”