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Turner Novak
@TurnerNovak
, 68 tweets, 22 min read Read on Twitter
Just played around on TikTok for awhile. A combined TikTok/Music.ly is going to be insane.

No one has been able to effectively reach both China AND RoW in social at scale. Total reach is going to be huge. Wouldn’t be surprised if Toutiao is valued over $100B in a year or two.
TikTok + Musical.ly = Vine v2
Bytedance (owns Toutiao, TikTok/Musica.ly) raising $3B at a $75B valuation.

Valued at $30B in late 2017, recent private market transactions trades imply a $62B valuation.

wsj.com/articles/beiji…
Bytedance could become a monster.

Use ad targeting profiles of Toutiao, (the news feed of China), to cross-target video ads on TikTok (the app is entirely video-based).

Musica.ly acq also makes TikTok biggest app w/ both US AND China reach

wsj.com/articles/beiji…
I tweeted about Toutiao awhile back. Biggest learnings:

-Bytedance will AI the shit out of TikTok. Takes less than a day to get new Toutiao users to 80% read rates on news articles.
-Will probably pay video creators. Watch out Instagram and YouTube.

TikTok's big advantage over other platforms:

ByteDance CEO's goal is to eliminate search and rely solely on recommendation algorithms. Facebook does this, but hard to get users to watch video ads long enough (3 seconds) on a feed-first platform. Easier on video-first TikTok.
ByteDance is entering the long-form streaming market. Netflix's recommendation algorithm has always been a huge advantage; I wonder how well BD's Toutiao/TikTok algo's convert to long-form video.

scmp.com/tech/start-ups…
An interesting dynamic here is that ByteDance generates most of its revenue from ads on its Chinese news app, Toutiao. Long-form video is an opportunity for it to ladder into subscriptions, which per this @jeremysliew tweet, are very popular in China.

ByteDance officially raising $3B at $75B led by SoftBank.

TikTok’s video-first format could create an insane amount of vertical video ad inventory, at a time when Snap and Instagram have already done the hard work convincing advertisers to go vertical.

ft.com/content/d7d1ef…
ByteDance/TikTok could fail to gain traction w/ advertisers ex-China.

It will, however, likely increase vertical video ad inventory, causing:

a) More vertical creative to be developed and ran in the entire ecosystem and/or
b) Put downward pressure on pricing across the industry
TikTok is Vine v2. ByteDance is my sleeper pick to be the most valuable social company in the world within five years.
Great insight on Facebook’s recently announced TikTok clone

ByteDance officially raises $3B @ a $75B valuation. Some takeaways:

- $2.5B in 2017 revenue, targeting $7.2B in 2018 (likely hurt due to short-term Chinese gov mandated takedown)
- Toutiao users spend almost as much time on Toutiao as WeChat

bloomberg.com/news/articles/…
Insightful deep dive on TikTok's expansion strategy:

-Created the best video editing tool
-Localized the app and content (w/ BD's recommendation algo) for each market
-Went after each market's biggest social influencers
-Spent up to $3M/day on user acq

kr-asia.com/a-closer-look-…
- Short video streaming is consuming 9% of Chinese internet users time, up from 3.8% in 2017
- 80% of Chinese smartphone users streamed video in 2017, up from 40% in 2013
- Users aged 50+ spend 50 mins/day in short video apps, up from 17 mins/day in 2017

techcrunch.com/2018/11/06/chi…
Over 1/3 of Chinese population uses a short video app monthly. Penetration of the big short video apps:

-Douyin/TikTok: 33.8% of Chinese internet users (Owned by ByteDance)
-Kuaishou: 22.7% (Tencent)
-Huoshan: 13.1% (ByteDance)
-Xigua: 12.6% (ByteDance)

techcrunch.com/2018/11/06/chi…
Pretty obvious paid promotional video from TikTok (do we really think that's Jimmy Kimmel's phone, w/ TikTok as the one app in the dock bar?). They're definitely dumping lots into user acquisition. Very interested in reading the S-1 as the IPO approaches.

Less than 5k downloads for FB's TikTok clone so far, also not paying creators (ByteDance pays on Toutiao, bet they do on TikTok soon).

TikTok's "spend millions per day on user acquisition" strategy is still debatable, but at least it's getting downloads!

digiday.com/marketing/vide…
Good ByteDance read:

-Expands on BD's localized strategy for each new market (stole talent from FB/IG)
-Most users don't realize it's Chinese owned
-For Chinese consumers, WeChat = Work; TikTok = Fun
-Short video length makes it easy to get sucked in

nytimes.com/2018/10/29/tec…
"A report from SensorTower released last month suggests that TikTok has surpassed more than $1 million in revenue in the US in the last month."

"SensorReport’s study also suggests that TikTok’s growth won’t slow in the near future."

theverge.com/2018/11/15/180…
Looks like Helo, ByteDance's regional news app for Indian languages, is facing some of the same challenges as WhatsApp in India. Good read if you've been following ByteDance.

Good piece on TikTok's AI by @conniechan

"TikTok is the first mainstream consumer app where artificial intelligence IS the product. It’s representative of a broader shift, where AI is transitioning from the discovery phase to the implementation phase."

a16z.com/2018/12/03/whe…
Preview of TikTok ads:

Full-screen vertical video ads that play with sound. Jury's still out, but I'd bet this ad unit eventually performs stronger than feed ads. Key is that Snap/FB have already done the work convincing advertisers to adopt this format.

How TikTok ads stack up to WeChat and IG feed.

Targeting‘s likely not robust yet in the US, but IG feed ads only take up 31% of screen. TikTok’s entire inventory will be full screen, giving lots of room for creative to make up for lack of (and eventually combine w/) targeting.
ByteDance going for Tencent's jugular and making a messaging app.

Not sure how their AI prowess translates here. Do users want AI messaging? Heavy recommendations in Snapchat's messaging screen were the biggest initial issue teens had with the re-design.

AI aside, I could see this working well if they're able to promote users to share Douyin, TikTok, Toutiao etc. content over a ByteDance messenger. Maybe they quickly build out the social graph by positioning it as a way to talk directly with creators on the BD family of apps?
Good read on the culture behind TikTok's US success

"I’ve witnessed an American user base that's a diverse composition of subcultures. These groups cross-pollinate in novel ways. The best content occurs when users collaborate. You can’t do TikTok alone."

artsy.net/article/artsy-…
ByteDance continues pouring truckloads of cash into TikTok user acquisition. Very similar playbook its used in other markets (pay up for influencers). Don’t sleep on the benefits of the first platform that reaches both China AND the US/EU/Aus etc at scale

TikTok is testing increasing upload length from 15 seconds to ~120 seconds.

Seems like it's slowly starting to look more like YouTube and Instagram. As TikTok ramps up its ad business, I wonder if/when it turns on revenue sharing for creators?

scmp.com/tech/apps-soci…
TikTok is plastering ads all over the London Underground. Per the thread, they’re all over the NYC WiFi hubs as well.

ByteDance is SoftBank's only social play, and I doubt they stop funding this aggressive user acquisition anytime soon.

ByteDance may seem undifferentiated, but it's positioning itself as the only media company with truly global scale. The US is by far the largest ad market (likely most profitable for FB, Google, Snap, etc), but China's middle class is quickly approaching the size of the US and EU
TikTok’s aggressive user acquisition spend looks reckless, but I doubt it's just for TikTok.

I bet we see ByteDance leverage the AI capabilities, content, and social graphs of Toutiao and TikTok to launch other products: a messenger, long-form video, podcasts, music, etc.
ByteDance's goal is to eliminate search; to immediately serve users exactly what they want.

I bet it continues layering on new forms of media, building both data sources and distribution. We'll likely see billions more poured into acquisitions, new products, and marketing.
I think an overlooked aspect of TikTok is that it trains users to watch entire videos. Many cases where a great TikTok video starts out slow, and the cute/funny/emotional part comes at the very end.

Have a feeling this will lend well to users to not immediately skipping ads.
Seems like TikTok has become for video memes what Twitter is for image memes.

Noticing a very evident TikTok -> Twitter/IG flow in video similar to the Twitter -> IG in image memes. Seems to be a function of the TikTok 1) camera editing tools and 2) user base demographics.
Good TikTok read:

-India has 39% of its 500M+ users (its largest mkt); contributed 3% of 2018 Revenue
-[WhatsApp has ~200M+ in India]
-10% of users are in US; 56% of 2018 Rev
-Fastest growth in rural areas
-Shows and in-app commerce could be coming soon

factordaily.com/the-chinese-ta…
This article also again highlights localization's role in ByteDance's growth:

-Pay local influencers to create best content
-Customize the app for each market
-Partner with local media players

Also mentions some interesting regulatory capture dynamics.

factordaily.com/the-chinese-ta…
Good read on TikTok Lite, also has some mind-blowing TikTok stats:

-267M and 67M installs on GPlay and iOS, respectively, in Q4
-887M GPlay installs historically to-date (so ~30% of them in Q4)
-These #'s don't include Douyin, the LARGER Chinese version

techcrunch.com/2019/01/04/tik…
The user retention TikTok sees on all its recent ad spending is still unclear, but the beauty of these short video apps is that the format lends well to mid-roll video ad breaks. As TikTok pivots into premium content like Snap did, key to remember it's prime for monetization.
It's fun to laugh at Snap, but its content product milks money. In Q3 '17, the CFO said US gross margins were over 50%, and it's only 5x'd the # of daily, high margin content shown in-app since then.

Any short video app that can get scale in the US and EU will be very valuable.
"Sophiya says that while she was familiar with musically during its heyday, she describes it as “basically a joke” when it was at its peak. The videos from TikTok, however, seem slightly different."

nymag.com/intelligencer/…
"Teens I spoke to were acutely familiar with TikTok videos from YT and IG, but only one had actually downloaded it."

"TikTok may seem like an impenetrable new app for the kids and tech savvy, but it’s a case study in the online distribution of content."

nymag.com/intelligencer/…
Looks like Douyin (Chinese version of TikTok) now has over 250 million DAU’s, having a recent spurt of growth.

I wonder if it was solely UA from the $3B SoftBank cas infusion, or if the recent content from outside of China makes it more interesting?

Here's a read on ByteDance's new messaging app, Duoshan. Described as a mix of TikTok and Snapchat, looks to be focused on close friends, much like Snapchat.

Going to be interesting how fast they can grow this off their existing content and social graph.

techcrunch.com/2019/01/15/tik…
Good example of the kind of videos that go viral on TikTok.

For what it's worth, I think the kids behind this account (gaycornerlads) are gong to be big... just some British kids doing Fortnite dances, backflips, the "OK hand symbol", and spin throws (?)

Pieced together some ByteDance revenue numbers going back to 2014. Likely not 100% accurate, but paints a picture that revenue growth accelerated ~2x in 2018.
ByteDance is heavily promoting new apps in the Chinese version of TikTok. Don't be surprised if this is just the beginning... ByteDance likely sees all its TikTok ad spend as going to far more than just one app.

Good first look at TikTok advertising in Europe. Looks like they're charging $10 CPM's for fixed buys. Has some info on userbase, which includes 800M DAU's globally, and nearly 4 million MAU's in each of the UK, France, and Germany.

digiday.com/marketing/pitc…
Here's a deep dive on Douyin advertising 101 in China (h/t @mbrennanchina).

Pages 34-35 highlight how users can setup e-commerce integrated with their videos and profiles. Assuming "Instagram Shopping" (and TikTok Shopping!!) will look similar.

dropbox.com/s/6plyo5fh6ano…
Interesting line in here:

ByteDance processes 50 PB of data per day, and thinks its AI has potential applications in content/object recognition (and surveillance!).

Definitely plays into my theory that ByteDance continues launching new/similar products.

pitchfork.com/features/artic…
"The upper middle class has a conspicuous consumption culture, where they seek out and align with the rich, making Instagram popular with them.

For the poor and lower middle class, the natural choice is to look for relatability and comfort [on TikTok]."

factordaily.com/tiktok-in-indi…
"In small towns or villages, people use their phones to laugh, not to know what politicians are saying. A 15-second video of a boy falling from a cycle counts as entertainment. In backward districts like Behrai, Facebook is a platform for intellectuals. ”

factordaily.com/tiktok-in-indi…
Some stats for TikTok in India:

- 52 million MAU's (compared to 294M for FB and 71M for IG)
- Users spend 29 minutes on TikTok per day
- 78% of users are under 25
- Penetration is at less than 10% of Indian internet users

factordaily.com/tiktok-in-indi…
TikTok is expected to launch a self-serve ad auction mid-summer 2019. Will include better targeting and measurement (matches the playbooks of FB, Google, Snap, etc).

One advertiser also expects a system to facilitate influencer marketing (as do I).

adweek.com/programmatic/b…
I've expected a self-serve ad platform from ByteDance since I started this thread. Will likely span all BD's apps la FB/IG, allowing Chinese advertisers to reach the US (and vice versa), etc.

FYI - $5B of FB's 2018 revenue was from Chinese advertisers.

nytimes.com/2019/02/07/tec…
I don't think it can be overstated how a cross-app ByteDance advertising platform opens up a whole new world - China - to all US/EU companies that relied on Facebook and Google to reach consumers over the past decade... the Chinese middle class is roughly the same size as the US.
New deck TikTok is using to pitch ad agencies:

-TikTok now at 27M MAU's in the US
-Users open 8 times/day for 46 mins total
-As shown below, average TikTok session in the US is 2x longer than on IG, 3.5x longer than Snapchat (likely due to lack of DMing)

Looks like TikTok has beat back the other short-video video apps in India by (you guessed it) outspending everyone. I'm really curious as to how it intends to ramp up monetization on traditionally low ARPU Indian users. Ads? Tipping? Ecomm? Subscriptions?

factordaily.com/kwai-vmate-dwa…
Lots to take in from this "as low as $0.04 to acquire a user in India" stat. Helps frame TikTok's aggressive marketing spend in the context of raising $3 billion from the Vision Fund in the fall of 2018.

"In previous eras, most of the spoils went to the platform’s earliest adopters - mining value gets harder as the platform ages. TikTok, on the other hand, promotes all content regardless of who made them or how many followers [social capital] they have."

getrevue.co/profile/caseyn…
Good TikTok read:

-30 day user retention in US is 10%, India is 30%
-23M DAUs in India (44% of 52M MAUs)
-ByteDance prepping in-house Slack clone, Lark, for external launch
-Lost $1.2B in '18, spent $300M+ on Google ads, "tens of millions"/month in India

YouTube is trying to become TikTok before TikTok becomes YouTube

(completely disagree with the YT vs Snap narrative in this article. TT and YT are completely different platforms than Snap)

engadget.com/2019/03/11/you…
ByteDance bought a game publisher. Not sure if I've already mentioned in this thread, but Douyin (TikTok in China) launched mini-programs (apps within an app), launching its first game last month.

Will we soon see games and other mini-programs in TikTok?

scmp.com/tech/apps-soci…
Working theory: since TikTok’s largely been built off paid acquisition, could you argue its users are more likely to be influenced by ads? You could also argue this makes them churn faster.
TikTok (Douyin) credit card spotted in the wild. Not sure if this is legit or what exactly it entails, but looks like it could be a partnership with China Everbright Bank.

linkedin.com/feed/update/ur…
This is crazy:

-ByteDance CEO has 14 direct reports
-Notorious for aggressive ad spending... it has no CMO (or CFO, or CTO)
-Has 40k employees, 2x'd in a year
-25% are in moderation
-25% in ad sales, monetization head prev worked at a newspaper
-12% R&D

theinformation.com/articles/the-p…
-ByteDance currently has 20 apps, with initiatives in gaming, live streaming, search, e-comm, education, literature, and social
-Standardized process for launching apps, judge ROI every two months
-Abandoned a beauty social network and Quora-like service

theinformation.com/articles/the-p…
This seems like a pretty big issue that has long-plagued TikTok. India banning it would be a death blow for ByteDance.

thedrum.com/news/2019/04/0…
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Turner Novak
@TurnerNovak
Takeaways on the #SnapPartnerSummit today.

-Snap's US userbase likely grew in Q1
-Launching plug-and-play monetization for developers and publishers
-Bitmoji is a decentralized social network
-$SNAP continues positioning for a post-mobile world of experiential computing

Thread:
$SNAP premium video ads now reach 75% of 13-35 year olds in the US per month (up from 70% when it announced Q4 earnings) and 90% of 13-24 year olds. It reaches more 13-24 year olds than FB or IG in the US, Canada, UK, France, and Australia (some of the largest mobile ad markets)
Having lots of users is important, but where those users are located is even more important in terms of LTV. Facebook likely loses money on most of its users, making up for it significantly in the markets where Snap isn’t too far behind.

Read 28 tweets
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Turner Novak
@TurnerNovak
$SNAP Q4 earnings today. Bad DAU numbers will tank the stock, but Snapchat has a core, sticky userbase and is being under-monetized.

Here's a thread on the Facebook Power Law and a look at how Snap could do up to $10 billion in revenue in the US alone in its current form.
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marketwatch.com/story/snap-ear…
To summarize my prior Snap earnings threads (below):

Snaps per Day is Snap's key metric, the US and EU are what matters for monetization, its ad prices are insanely low, and the market is not appreciating Bitmoji, Snap's AR platform, or the Snap Map.

Read 54 tweets
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Turner Novak
@TurnerNovak
Thread on the $SNAP Q3 earnings today.

I'll tell you why "Snaps Created per Day" is the most important metric (matters more than DAUs), followed by my thoughts on Snap's camera and ad platforms, Bitmoji in a post-Facebook world, Snap's content strategy, and the Snap Map
I'll try not to repeat myself too much, but I've tweeted some of this stuff before. Here's a thread with my thoughts from the past few quarters.

Snaps per Day remains the key metric for Snap. The camera is a new distribution channel (ads, commerce, content, gaming), one where Snap has a significant advantage due to the ecosystem it has built and the Snapchat cameras high frequency of use (aka Snaps per Day per User).
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