TikTok has once again proven itself as a transformative force in digital marketing. A groundbreaking Marketing Mix Modeling (MMM) study conducted by Dentsu, in collaboration with 15 Nordic brands, has unveiled how TikTok ads drive short-term revenue and foster long-term brand growth.
The study spans Norway, Denmark, Sweden, and Finland and offers a deep dive into TikTok’s unique ability to turn creative storytelling into tangible sales. For brands in the Nordics and beyond, TikTok is no longer just a platform for viral dances and trends; it’s a critical tool for business success.
The Power of TikTok Advertising
Dentsu’s study employed the Total Contribution of Marketing framework to measure TikTok’s impact on brand sales across different time horizons. The results are nothing short of impressive.
In the short term, TikTok delivered an astounding 11.8X return on investment (ROI), solidifying its position as one of the most effective digital platforms for driving revenue. To put this into perspective, 75% of advertisers reported that TikTok provided their highest ROI compared to other platforms, including traditional social media giants like Instagram and Facebook.
But TikTok’s influence doesn’t end when the ad stops running. The study found that the sales impact of TikTok ads lasted 3-4 weeks post-exposure, demonstrating the platform’s ability to leave a lasting impression on consumer behaviour.
Why Always-On Advertising Wins on TikTok
One of the study’s most striking insights is the power of consistency. Brands that adopted an “always-on” advertising strategy on TikTok, maintaining a continuous presence rather than relying on sporadic campaigns,s saw sustained sales growth over time. This approach keeps brands at the forefront of consumers’ minds, fostering familiarity and trust.
Think of it this way: TikTok’s algorithm thrives on engagement. When brands consistently post content, they’re more likely to appear on users’ “For You” pages, the platform’s highly personalized feed.
This constant visibility drives immediate sales and builds a foundation for long-term brand loyalty. For businesses, this means that TikTok isn’t just a platform for one-off campaigns; it’s a space where sustained engagement can yield compounding returns.
Storytelling vs. Tactical Content: What Works Best?
The study also delved into the effectiveness of different content strategies, revealing a clear winner: storytelling. Authentic, narrative-driven content outperformed direct promotional messages by a significant margin.
Specifically, user-generated content (UGC) that told a story through relatable scenarios, humour, or emotional appeal delivered a 70% higher ROI than purely promotional UGC.
Interestingly, even professionally produced ads fell short when compared to organic-style content. This suggests that TikTok users value authenticity over polish.
They want to see real people, stories, and experiences not just slick advertisements. For brands, this means shifting away from hard-sell tactics and embracing a more organic, story-driven approach. By weaving product messaging into engaging narratives, businesses can create content that resonates deeply with their audience.
The Long-Term Impact
While TikTok’s ability to drive short-term revenue is impressive, its long-term benefits are equally noteworthy. The study found that TikTok ads provided an additional long-term ROI of 4.5, highlighting the platform’s role in building brand equity over time.
This isn’t just about immediate conversions; it’s about creating a lasting digital footprint that keeps consumers returning.
TikTok’s algorithm plays a key role here. By favouring consistent and engaging content, the platform helps brands build a loyal audience beyond a single campaign.
Over time, this audience becomes more than just customers they become advocates, sharing their favourite brands with their networks. For businesses, this means that investing in TikTok isn’t just a short-term play; it’s a long-term strategy for growth.
Key Takeaways for Marketers
So, what does all this mean for brands looking to harness the power of TikTok? Here are the key lessons from Dentsu’s study:
Prioritize Storytelling: Authentic, narrative-driven content isn’t just more engaging—it’s more effective. Brands should focus on creating stories that resonate with their audience, seamlessly integrating product messaging into relatable scenarios.
Stay Consistent: An always-on TikTok strategy ensures sustained engagement and brand recall. By maintaining a continuous presence, brands can stay top-of-mind and build lasting relationships with their audience.
Think Long-Term: TikTok advertising isn’t just about instant sales; it’s about cultivating a loyal audience over time. Brands that invest in long-term strategies will see compounding returns in revenue and brand equity.
Dentsu’s study reaffirms what many marketers have already begun to realize: TikTok is more than just a social media platform it’s a dynamic e-commerce engine and a powerful brand-building tool.
Businesses can unlock TikTok’s full potential by leveraging engaging storytelling, always-on strategies, and organic-style content, which will drive immediate revenue and long-term growth.
TikTok represents a unique opportunity for Nordic brands and, indeed, brands worldwide to connect meaningfully with consumers. It’s not just where people are scrolling; it’s where they’re shopping, engaging, and building relationships with the brands they love. In the ever-evolving digital marketing landscape, TikTok isn’t just a trend it’s the future.
To further contextualize these findings, industry experts emphasize TikTok’s unique ability to blend entertainment with commerce. According to a 2023 report by eMarketer, TikTok’s user base in the Nordics has grown by 25% year-over-year, making it one of the fastest-growing platforms in the region.
Additionally, a Nielsen study found that TikTok users are 1.5X more likely to discover new products on the platform than on other social media channels. These statistics underscore TikTok’s role as a discovery engine, where users don’t just consume content they actively seek out new brands and products.
For businesses, this means that TikTok isn’t just a platform for advertising; it’s a space for innovation and creativity. By embracing the platform’s unique culture and leveraging its robust algorithm, brands can turn casual viewers into loyal customers and advocates for their brand.
Ultimately, TikTok’s success lies in its ability to humanize brands. By telling authentic stories and engaging with users personally, businesses can create meaningful connections that drive sales and loyalty. And in today’s competitive marketplace, that’s a recipe for success.
