Why you shouldn't spend money on Tik Tok

Recently, I was approached by a private investor who wanted to make money on TikTok through the production of content on this platform. The idea is clear, the production process is easy, but the question is: how much is this idea generally paid off?

The short answer is that it doesn't pay off.

First of all, we interviewed about 300 content authors. We clarified with them the usual level of income from tik-tok, compared the answers. The survey was conducted among authors with a completely different number of subscribers.

The income of the author, as expected, depends on popularity. The minimum plan is 300,000 subscribers, then you can expect an income of $ 1,000 per month (I write the prices in this post for the CIS countries) and this is with a daily upload of 1-2 videos.

We considered the following options for monetization in TikTok:

1. Production of your own creative content. We are hiring a creative team, an actor, a production team. We shoot every day. Profit?

Nope. The costs were up to $5,000 per month. The payback was 2-3 years, and then, on the condition that it was possible to develop the account to millions of coverage. The risk is big.

2. Hiring existing tik-tokers, connecting a creative team to them. We reduce production costs, we agree with the author on a percentage of the profit in exchange for investments in its promotion. Profit?

Nope. With such a production scheme, it is important to immediately contract with 10 authors. And invest up to 2,000 dollars in the promotion of each, plus the hours of management and creators. 4 authors will definitely say “Guys, I'm tired” after some time. Yep, this happens with tik-tokers who make content for an idea. There is no author, the money is spent, the project is closed. And the other 6 may not yet succeed or succeed, but after a longer time than planned.

3. Agency scheme, you say? Well, yes, we find already developed authors, sign them and represent interests before advertisers. The percentage of the transaction is ours. Profit?

Damn, no again. The author will go to you only for a community of tik-tokers like him. No party - no new authors. Vicious circle. Plus, it is difficult to compete with large agencies that have already entered the market, who formed such a community (note: the investor asked to consider the creation of an agency from scratch, without using the Lava Media brand).

Well, come om, what about all these successful stories and tik-toks’ homes? I will answer: survivor's error. Our global survey showed that the market is saturated, the income of authors is miserable (as part of a business project), the risk that your content will not be liked is huge.

Conclusion: Do you have time, creativity and a camera? Then yes, you can build an adequate passive income by enjoying such a hobby. Business here is pure venture with all the consequences.