How We Achieved a 12x ROAS on TikTok with $7K in Ad Spend

phone using tiktok

Diversifying your paid social channels is the name of the game when it comes to social advertising in 2021, especially since iOS 14 rolled out. And any growth marketing agency like Tuff is testing TikTok, trying to find ways to make the viral video platform profitable for our partners.

We’ve managed thousands of dollars in TikTok spend for our clients, and we’ve seen a ton of success and growth opportunities on the channel, particularly for our client Sabio – an online coding bootcamp based in Los Angeles. (So much so that we had to pause campaigns for a bit because there were too many leads for their sales team to work. 🤓)

Like any new channel that a TikTok ad agency tests, we started small to make sure TikTok was going to be effective, and gradually increased our spend over a three month period. Numbers speak louder than words in most marketing conversations, so this blog post includes data from Sabio campaigns.

A little bit of background so these numbers have context: 

  • Sabio is an online coding bootcamp — our primary goal is to grow the number of qualified applications submitted on their site. 
  • Our primary KPI is Cost Per Application (CPA). 
  • We’ve ran ads on 8 different channels for Sabio – Reddit, Google, Bing, Quora, YouTube, Facebook & Instagram, TikTok, and Snapchat! So we have a ton of data to compare channel performance.

The CPA on TikTok was 62% lower than the CPA on other paid acquisition channels.

When we first launched TikTok, we saw immediate success, with CPAs consistently in the $11-$16 range over the first few months. But I think we were all a bit skeptical over the quality of the applicants. 

To help keep a pulse on lead quality, we worked closely with the Sabio team to keep a pulse on how many TikTok applications were attending info sessions and enrolling in bootcamp programs. 

We did see that TikTok’s applications were slightly less qualified compared to Facebook, but the CPA was 62% lower, so it still made sense to continue to run ads on TikTok.

In fact, TikTok campaigns generated 448 total applications, and 7 enrolled students. With a bootcamp tuition of $12K, that’s $84K in total revenue, and a 12X ROAS.

Here are some of our biggest takeaways so far from TikTok:

High-Impact Creative is Necessary

If you want to see success on TikTok, you have to make sure you’re using creative that mimics the TikTok style that users expect to see when they scroll on the platform.

tiktok ad example

For Sabio, this was easy. They’ve already gone all-in organically on TikTok. They post several videos a week, and some of them have half a million organic view. 

Our top-performing ads played off of some of TikTok’s most viral video trends, with text overlays that speak to Sabio’s value props.

BUT if posting to TikTok everyday isn’t right for you, don’t let it deter you! TikTok ads could still work for you if your audience is on the channel. You can still create strong video ads without necessarily repurposing organic posts. Check out this article where we talk about some of our best creative tips for TikTok!

But is your audience on TikTok?

TikTok’s ad platform is still in its infancy, and like all other social ads platforms when they first got started, the audience target capabilities leaves us wanting more (much, much more). 

Before you add TikTok to your mix of social advertising channels, take a beat and ask yourself if your audience is ACTUALLY an active TikTok user, or if this is a shiny new toy and you’re jumping in without a real strategy. 

Not all audiences are on TikTok, and it doesn’t make sense for every single brand. But if we’re working with a B2C brand targeting users between 17 and 35 years old, TikTok’s probably going to be on our list of channels to test.

Sabio’s target audience is perfect for TikTok: 18-30 year olds who tend to be early adopters. Specifically, we targeted:

  • Users interested in Gaming (top performer!)
  • Users interested in Music
  • Users interested in Culture/Education
  • Users interested in Tech (top performer!)

At the time that we launched these campaigns, TikTok didn’t have a lookalike audience feature, and the number of applications on our TikTok pixel wasn’t quite big enough. But this is on our radar to test in the coming weeks!

Campaign Setup

Whenever we test new social channels, one of the first things we test is campaign optimizations. For Sabio’s TikTok campaigns, we tested conversion vs. traffic. 

While our traffic campaigns had insanely low CPCs (like $0.08), the quality wasn’t there. The conversion rates were abysmal, and we quickly decided that conversion campaigns were the clear winner. 

Note: That seems super intuitive, but you’d be surprised how many times we see traffic campaigns crush it on some of these secondary social channels like TikTok, Snapchat, Twitter, Pinterest, and LinkedIn.

Day Parting

Within the first month, we noticed that our TikTok campaigns were spending the daily budget before 2 p.m., and we knew that our audience was likely active on TikTok at night. 

We tested running ads from 12 p.m. to midnight, and saw 33% lower CPAs compared to the original campaigns.

While TikTok was wildly successful for Sabio, it definitely hasn’t worked for all of our partners. No matter what campaign optimization tricks you have up your sleeve, TikTok will only work if you have the perfect audience + creative combo. 

If you’ve made it this far, thank you for spending a few minutes reading through my TikTok endeavors! I hope you picked up a thing or two to test. 

I’d love to hear how TikTok has performed for you! HMU with any questions.

Running a TikTok Ad Campaign: 5 Tips for a Successful Launch

Unless you’ve been living under a rock (…but I mean, after all that 2020 brought with it, can I live under a rock with you?), you’ve seen how TikTok has changed the social media game. What once started as a quirky music platform for preteens quickly – and I mean QUICKLY – climbed the ladder to become one of the most popular social media apps.

Here are the TikTok facts:

  • In less than 18 months, the number of adult TikTok users in the U.S. grew 550%
  • TikTok is the most downloaded app in the Apple App Store with 33 million downloads
  • TikTok has more than 800 million active users worldwide, but only about 10% are in the U.S.
  • 90% of TikTok users visit the app more than once per day.

Aside from the sheer growth in monthly active users, TikTok has fundamentally changed how we consume video content online, and other social media giants are emulating that same style – we see you Instagram Reels. We want it vertical, we want the cleverly-edited music to add umph, and we want it short and sweet.

Pair TikTok’s insane growth with the buzzword for 2021 social media advertising – diversifying your paid channels in the wake of iOS14 and updates to Facebook advertising – and you get one big question.

How do I grow my business with TikTok ads?

Well, we’re here to help answer that! At Tuff, we’ve found that clients who are successful with Facebook and Instagram ads can also see success on TikTok – particularly the clients with strong video creative and the ability to produce new videos often.

Check out these 5 tips for successfully launching your first TikTok campaign!

1. Set Up Your TikTok Pixel and Events

Just like every other social channel, TikTok also has an events manager tool that allows you to track app events and activity on your website with a piece of code. The TikTok pixel integrates well with both Shopify and Google Tag Manager for easy setup, or provides the option to manually install the pixel in the header of your website.

Once the pixel’s base code is installed on your site, you’ll be prompted to set the event rules using either Standard Mode or Developer Mode. The method you choose is based on your business and conversion path – we’ve set up events both ways successfully. TikTok’s Standard Mode is most similar to Facebook’s Event Setup Tool (if you’re familiar with that!), but more accurate in our experience.

2. Build Custom Audiences and Create Lookalikes From Them

Once you have your pixel installed, take a second to create custom audiences based on website/app activity and your customer lists. Then, create lookalikes off of those custom audiences.

The lookalikes will come in handy when you’re creating target audiences for prospecting campaigns, and you’ll be able to exclude some of your custom audiences from ad groups to prevent waste.

3. Create Target Audiences that Aren’t Too Small

There are 80 million TikTok users in the U.S. That’s a LOT of people, don’t get me wrong. But we’re used to Facebook’s even larger audience pool.

Comparatively, Facebook has 223 million U.S. users. With a user base that large, a prospecting audience narrowed by demographics, interests, and layered on top of a lookalike audience can still be 3+ million users.

On TikTok, those same targeting parameters would yield an audience size of 35K monthly active users.

Inherently, TikTok audiences are going to be smaller than what we’re used to on Facebook, but the same rule of thumb applies: larger audiences (caveat: with relevant targeting) typically yield lower costs per results.

Here are a few tips on audience targeting that we’ve learned the hard way on TikTok:

  • Ditch the age targeting. We know that most TikTok users are under the age of 35. If your target audience’s age range is above that, TikTok might not be the right channel for you anyway. Targeting by age can narrow your audience size without improving results.
  • Watch for ad fatigue. Smaller audiences mean that your frequency gets higher, faster. You’ll want to keep an eye on your results – if you see costs start to increase, try rotating in new creative first.
  • If you’re optimizing for lower-funnel conversion events and having a hard time seeing success, try removing your targeting completely. This is what we did for our app client Felt (For this next sentence to make sense, you’ll need to understand how we measure success for Felt. I’ll be referencing one of our main metrics – cost per app install, also known as CPI). After struggling to see success with targeted audiences based on demographics and interests, we removed much of our targeting and saw CPIs as low as $1.67 – when our historical average has been closer to $3. By optimizing for low funnel conversion events and removing our targeting, we let the TikTok algorithm do much of our targeting work for us, and it worked successfully.
  • If your audience is in the U.S., narrow your placements to TikTok only. TikTok also owns TopBuzz, BuzzVideo, News Republic, Babe, Helo and Pangle, which primarily have a global audience.

4. Develop Video Ads Made With TikTok Trends in Mind

To grow your business with TikTok ads, relevant 👏 creative 👏 is 👏 key👏 to 👏 success.

One more time for the people in the back (and because this is so, so important). You’re interrupting someone’s feed with a brand ad that the user didn’t ask for, but got anyway. Your content should be captivating, designed with TikTok consumption in mind, and concise.

Based on the campaign results we’ve seen so far for our clients, here are a few TikTok ad creative tips to help get you started:

  • Keep it short and sweet. Our best ads have been 15-20 seconds long.
  • Be thoughtful about your background music. While it’s not as important for other social channels, trendy music and TikTok go together like everything bagels and cream cheese. Try to edit your video to the music and capitalize on trending video styles when you can.
  • Launch campaigns with at least three very different video ads (no more than 5 videos max per ad group!). You want to make sure your videos differ so that you can draw meaningful insights as to what’s performing best. If they’re all similar, it’s hard to understand what type of content will yield the best results.
  • Make sure that you use lots of color contrast and show people when you can! Our best ads that we’ve ran so far have pops of bright colors and show faces – and have a 27% higher conversion rate compared to our other ads.
  • TikTok has a pretty strict ad approval process. Make sure you’re buttoned up and familiar with their advertising policies before you put your ads in review.

Peep this document for a full list of creative best practices and specs.

5. Use UTMs to Track Attribution in Google Analytics

Like any social media platform, native attribution in TikTok’s ad manager using data from the pixel is often inflated compared to Google Analytics (hello again, last-click attribution and the biggest mistake most businesses make when it comes to PPC campaigns).

To know what worked and what didn’t on TikTok, we recommend using an organized naming convention for your UTM parameters that will give you insight into how both the audience you’re targeting and the creative you’re running performed in Google Analytics.

Common TikTok Ads Questions

Q: How much does it cost to advertise on TikTok?
A: Currently, the minimum spend requirement on TikTok is $50/day. The campaigns we’ve run here at Tuff have had CPMs in the $4-$7 range.

Q: Do I need an organic presence on TikTok to run ads on the channel?
A: Unlike other social channels, like Facebook, Instagram, Twitter, etc., where you’re required to have a business page or profile built to run ads, you can run ads on TikTok without creating an organic channel. In fact, you access TikTok’s ads manager through a completely different login portal than where you’d login to an organic account.

Q: Is my audience on TikTok?
A: While the channel has grown exponentially over the last year or so, the demographic still skews younger compared to other social channels. 41% of TikTok users are between 16-24, and 56% are male.

Q: How does TikTok attribution work?
A: Attribution can be a struggle on any social channel, and TikTok is no different. Currently, the TikTok pixel records single-session conversions, meaning that a user must click on the ad and convert within the same session for TikTok to attribute that conversion to your ad. TikTok also integrates well with third-party tracking tools like AppsFlyer, Kochava, Tune and Adjust to better understand attribution.