Social Media Advertising War: The Battle of the Titans TikTok vs. Meta

As ad markets soften, publishers often reduce prices to sell their inventory, leading to a downward spiral as other publishers cut prices to compete. This same race to the bottom is occurring in social media, as nearly 30% of major advertisers plan to decrease their budgets for social media advertising in 2023.

TikTok began charging CPMs 30 to 60% lower than its competitors, including Meta, Twitter, Snap, and YouTube, to counter this.

This discount has proven effective as TikTok gains market share at the expense of its rivals.

Paywalls have become a strategic response for publishers combating declining advertising revenue. To counter this decline, publications like the Wall Street Journal and other reputable news brands have implemented paywalls, requiring readers to pay fees for access and subsequently boosting digital subscriptions.

However, the growing prevalence of paywalls is contributing to subscription fatigue, posing a risk to further growth.

This competition not only pits media publishers against service providers with diverse skill sets but also underscores the challenges of managing subscription services compared to traditional content publishing.

The impact of subscription fatigue on video streaming services, known for their costliness and ease of substitution, is noteworthy. This phenomenon has prompted major players like Netflix, Disney, and Apple to respond by increasing their monthly subscription fees in 2022.

Additionally, they’ve introduced ad-supported versions of their streaming services at lower fees, adapting to the evolving landscape.

Amid these changes, TikTok has entered the arena, experimenting with a paid subscription service.

This move signifies a broader trend of platforms exploring diverse monetization strategies beyond traditional ad-based models.