TikTok, Facing US Ban, Tells Advertisers It Won’t Back Down

Hundreds of marketers and ad agency types flocked to TikTok’s annual sales presentation after a new law put its future in question.

Blake Chandlee, in a white button-down shirt and light blue trousers, speaks into a microphone.
Blake Chandlee, TikTok’s president of global business solutions, last June. In Manhattan Thursday, he said: “We believe the facts and the law are clearly on our side and that we will ultimately prevail.”Credit…Olivier Anrigo/Getty Images

Sapna Maheshwari

Hundreds of advertisers, including major brands like L’Oreal and Victoria’s Secret, flocked to the Lower East Side on Thursday night for TikTok’s annual spring pitch to marketers. It had been about a week since President Biden signed a law that says TikTok must be sold from its Chinese parent company or face a potential ban, and marketers were champing at the bit to hear TikTok’s thoughts.

They didn’t have to wait long. Blake Chandlee, TikTok’s president of global business solutions, kicked off the evening by thanking advertisers for their “tremendous support and trust” and said the company considered the law unconstitutional and would challenge it in court.

“We believe the facts and the law are clearly on our side and that we will ultimately prevail,” Mr. Chandlee told more than 300 attendees, some of whom couldn’t find chairs in the crowd. “I want you to know we are not backing down.”

But for the rest of the roughly 45-minute presentation, which took place in a large gallery with the fuchsia and light blue lights of TikTok’s logo, it was business as usual. And it was a keen reminder that Madison Avenue’s concerns about TikTok, which center on how to cleverly market their products and ensure that consumers are seeing their ads, are vastly different from those of Washington, where officials consider the app a national security risk.

Sofia Hernandez, TikTok’s global head of business marketing, declared that TikTok had gone from “being viral to vital” for businesses. The company’s executives introduced new tools for running ads against trends and events like the Summer Olympics in Paris. A Unilever marketing executive described how the Vaseline brand had thrived by tapping into a TikTok skin care trend known as “slugging.” Many marketers were visibly confused until she explained that the term referred to slathering one’s face with petroleum jelly before bedtime to seal in other serums and moisturizers.

“TikTok is the most interesting story in advertising right now,” said Craig Brommers, chief marketing officer of the retailer American Eagle, who attended the event. “That’s why you had a standing-room-only audience waiting to hear what’s next for the most important video platform for Gen Z.”

Near one of the long bars serving “Violet Hour” cocktails and wine, several stations highlighted creators from TikTok niches like sports and luxury. “From boy moms to girl dads, TikTok is for #parents,” one said. The company sent guests home with branded Dagne Dover bags that retail for around $75.

TikTok’s executives reminded advertisers that with 170 million monthly U.S. users, the user base had started to reflect the general population. “We’re not just Gen Z anymore,” said Tim Natividad, TikTok’s U.S. head of enterprise sales.

Advertising is the lifeblood of platforms like TikTok, which has become a core tool for marketers pitching Americans on new makeup, fast-food hacks, music and more. The company appears determined to maintain ad dollars amid its uncertain future, particularly as U.S. tech giants focus on their market share and push short-form video competitors like Google’s YouTube Shorts and Instagram Reels.

TikTok and its Chinese parent company, ByteDance, are private and do not publicly disclose their financials. Brian Wieser, an independent ad industry analyst, recently estimated that TikTok brought in $6 billion in U.S. ad sales last year, but said that excluded revenue from e-commerce, tipping and other ventures. In the United States, TikTok users spend 54 minutes per day on the app, while Instagram users spend 35 minutes on that app, with 21 of those minutes devoted to video, according to the data firm eMarketer.

Under the law signed law week, TikTok must be sold from ByteDance within the next nine months. The Biden administration, lawmakers and security experts have said that under TikTok’s current ownership, there are risks that the Chinese government could lean on ByteDance for access to sensitive data on TikTok users or to spread propaganda.

The company has not yet sued to challenge the law.

Last week, after President Biden signed the bill, Michael Beckerman, TikTok’s head of public policy for the Americas, told employees at an all-hands meeting that the situation was “unprecedented” and “very political,” according to an audio recording that was shared with The New York Times.

“We’re sitting between some of the largest geopolitical issues of our time as well as some very, very complicated issues with technology globally, and privacy and all these policy issues,” Mr. Beckerman said in the April 24 meeting.

Mr. Beckerman said he was buoyed by Mr. Biden’s plan to use TikTok in the lead-up to the election. He also said the vote “was not about us” because it passed as part of a broader package of aid for countries like Ukraine and Israel.

“We’re going to win,” he told employees. “We’re optimistic this is not the end of the process.”

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Roy Walsh

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