How TikTok ban could reshape marketing and commerce in US

The potential shutdown of TikTok in the United States could devastate approximately 7 million small and medium-sized businesses (SMEs) that rely on the platform for marketing, advertising, and sales. A recent report from the U.K. highlights that U.S. SMEs alone could face losses exceeding $1 billion (approximately HK$7.8 billion) in revenue if the platform is banned. Additionally, nearly 2 million creators may lose up to $300 million (approximately HK$2.34 billion) in income. TikTok itself is projected to experience a 29% drop in global advertising revenue by 2025.

With 170 million users in the U.S., TikTok's suspension could have far-reaching effects on local creators, businesses, and even Chinese cross-border e-commerce sellers. According to a 2022 report by the Oxford Economics Institute, TikTok provides marketing opportunities for millions of SMEs in the U.S., creating 224,000 jobs and contributing $24.2 billion to the U.S. economy in 2023. If the platform is banned, these businesses and individuals would face significant economic challenges, potentially altering their livelihoods.

Businesses Face Severe Losses

Jessica Simon, the founder of a Mississippi candle company, shared her concerns: "If TikTok is banned, I foresee a dramatic drop in sales. It's heartbreaking." Simon revealed that 90% to 98% of her sales are directly or indirectly tied to TikTok. Most of her customers discover her products on TikTok and purchase them through the platform's store or her website.

Simon started her business at home, but TikTok's introduction of its shop feature in 2023 transformed her operations. Her company surpassed six-figure sales twice in November and December 2023. "I'm devastated for my employees. There's no way to replace this traffic or revenue elsewhere," Simon said. Her business boasts 50,000 followers on TikTok, compared to just 7,700 on Facebook and 3,100 on Instagram.

Similarly, a fashion designer and artist, Nicole stated, "TikTok is my primary source of income because brands want their products promoted on this platform."

Public Opposition to the Ban

The proposed TikTok ban has faced strong opposition from U.S. users. According to a youth market research firm YPulse survey, 73% of Americans aged 13 to 39 oppose the ban. Over a quarter of respondents stated that their jobs or income would be affected if TikTok were banned.

TikTok is especially popular among Gen Z users. Pew Research Center data shows that 63% of U.S. teenagers aged 13 to 17 use TikTok, with 57% using it daily and 16% almost constantly. TikTok's 15-second videos, complete with beauty filters and quirky stickers, have become a hallmark of Gen Z communication.

For college student Semings in Ohio, TikTok represents more than just entertainment: "For our generation, TikTok is a coping mechanism. Losing TikTok could fundamentally change how we interact with the world and each other."

The Rise of TikTok in the U.S.

2018-2019: TikTok entered the U.S. market by acquiring short-video apps Flipagram and Musical.ly, quickly building a fan base with its beauty filters and live-streaming features.

2019-2020: Targeting American teenagers, TikTok invested heavily in Instagram and Snapchat ads, becoming a favorite among Gen Z users. By 2020, TikTok's weekly usage rate among U.S. Gen Z had reached 50%.

2020-2021: During the COVID-19 pandemic, homebound Americans turned to short-video platforms. By March 2020, TikTok had been downloaded 165 million times in the U.S.

TikTok Resumes Services in the U.S.

On January 19 (local time), the short-video social media platform TikTok resumed its services in the United States.

According to reports, at around 9:30 AM Pacific Time (1:30 AM HKT on January 20), TikTok issued a statement on social media announcing that the company had agreed with internet service providers to restore its services. Journalists confirmed that the TikTok app and website were functioning normally again.

In its statement, TikTok expressed gratitude to U.S. President-elect Donald Trump for providing necessary clarifications and assurances to the platform's internet service providers, ensuring they would not face penalties for supporting TikTok's operations. TikTok also stated that it will work with Trump to develop a long-term solution to maintain the app's availability in the U.S.

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