The effect of advertising strategies on a short video platform: evidence from TikTok
| DOI | https://doi.org/10.1108/IMDS-12-2021-0754 |
| Published date | 11 August 2022 |
| Date | 11 August 2022 |
| Pages | 1956-1974 |
| Subject Matter | Information & knowledge management,Information systems,Data management systems,Knowledge management,Knowledge sharing,Management science & operations,Supply chain management,Supply chain information systems,Logistics,Quality management/systems |
| Author | Lin Yuan,Hao Xia,Qiang Ye |
The effect of advertising strategies
on a short video platform: evidence
from TikTok
Lin Yuan, Hao Xia and Qiang Ye
School of Management, Harbin Institute of Technology, Harbin, China
Abstract
Purpose –There are two major strategies for short video advertising which are KOL (key opinion leader)
endorsement and in-feed advertising. The authors aim to research the effectiveness of these two strategies for
heterogeneous sellers.
Design/methodology/approach –The study employed a data set of users from Douyin. Using an
endogenous treatment model, the study empirically examines the two strategies’effectiveness in attracting
product traffic for online retailors at a short video app Douyin (TikTok).
Findings –The results show that the performance of in-feed advertising is higher when the seller’s product is
of lower price and when the seller has smaller cumulative video exposure. In addition, KOL endorsement is
effective regardless of the product price, but performs better when the seller has larger cumulative video
exposure.
Originality/value –To the best of the authors’knowledge, this study is one of the first to explore the
interactioneffects of two major advertisingstrategies, KOL endorsement and in-feed advertising on short video
platforms. The findings provide important theoretical contributions and practical implications.
Keywords Short video marketing, In-feed advertising, KOL endorsement, Social commerce, TikTok (Douyin),
Douyin marketing
Paper type Research paper
1. Introduction
With the continuous development of social commerce, short video platform has gradually
become another area of e-commerce (Mhalla et al., 2020). Launched by ByteDance in
September 2016, TikTok (Douyin) is now one of the leading short video mobile apps by
number of downloads as well as active users, which allows users to browse other-created
contents and post self-created videos (ByteDance, 2018). According to the 2019 data report,
Douyin has more than 400 million daily active users. Especially during the epidemic period,
merchants prefer to conduct short video sales on Douyin. The main reason is the
decentralized delivery mechanism of Douyin, when the system engine receives videos
uploaded by users; it analyzes the interests of the user, sorts them, and recommends relevant
short videos (Maharjan, 2019). The recommendation mechanism calculates the tag of each
uploaded video and classifies the videos according to their category characteristics. It then
maps the label of video to users with the same label. Thus, Douyin realized the accurate
positioning based on big data algorithms, which further promotes short video marketing
(Lu, 2019).
Presently, revenue streams of Douyin mostly from advertisement display and campaigns
(Chen, 2017). In-feed advertisements and KOL (key opinion leader) endorsement are two
primary advertising tools on Douyin. The in-feed advertisement service, whichbegan in 2016,
incorporates advertising messages into the short video (Chen, 2019). Advertising messages
are shown underneath short videos, implanting product links in advertising content and thus
making it more accessible to users (Plate 1). When a user clicks on the product link or
according to times of advertising exposure, the platform charges sellers a service fee (Zhang
and Osawa, 2019). KOL endorsement, another advertising tool offered by Douyin, was
IMDS
122,8
1956
The current issue and full text archive of this journal is available on Emerald Insight at:
https://www.emerald.com/insight/0263-5577.htm
Received 16 December 2021
Revised 25 March 2022
21 May 2022
Accepted 24 May 2022
Industrial Management & Data
Systems
Vol. 122 No. 8, 2022
pp. 1956-1974
© Emerald Publishing Limited
0263-5577
DOI 10.1108/IMDS-12-2021-0754
proposed in 2018 (Windels et al., 2018). The endorser posts short videos of different products
to redirect traffic to the seller’s website, and they receive a commission based on the effect of
ads and the number of followers they own (Plate 2). Essentially, sellers post tasks for products
they want to promote on Ocean Engine. Then, the endorsers can contact sellers to discuss the
products details, and finally post short videos on Douyin to share the product information
such as user experience (Zimmer and Scheibe, 2019). Given the great value of advertising on
short video platforms, both researchers and practitioners pay increasingly more attention to
this field.
Existing literature mainly focus on investigating the effect of single advertising tool to
improve firm performance (Fan et al., 2017;Farivar et al., 2021) or understanding factors of
the advertising enhancing consumer and product interaction (Kiss and Bichler, 2008;
Li and Du, 2011). Besides, several researches have begun to explore the consumer
heterogeneity to certain advertising method (Blake et al., 2015;Hamouda, 2018). However,
it is little known that the heterogeneity of sellers has an impact on the choice and effect of
different advertising tools to attract customers. It is largely silent on why or when one
selling channel is or should be chosen over another (Choi et al., 2020). Therefore, the
purpose of this paper is to fill this gap in the literature by jointly studying the differential
effects of in-feed advertisements and KOL endorsement for heterogeneous sellers
promoting their products. Overall, we respond to the following questions: Are these
advertising strategies effective in increasing website traffic? What types of sellers are
Plate 1.
Illustration of
in-feed ads
Effect of short
video
advertising
strategies
1957
To continue reading
Request your trial