The fast-growing tiktok
TikTok logo. Image: TikTok Offical reserved

Do a case study of a platform business. When did the business commence, what are its primary fields of operation, and has it been successful? How does it make money from its activities, and have any concerns been raised about the company?


In essence, the short video industry is an “attention economy,” a specific economic model for attracting the maximum amount of attention from users or consumers and obtaining future commercial rewards by developing potential consumer groups. At the moment, there are six profit models in the short video industry: advertising profit, e-commerce cash, content reward, user payment, I.P. profit, and capital operation. Exploring the profit model of the short video reveals that wide dissemination and precise marketing are the keys to short video profit. The platform’s core business is video, which generates no revenue. Advertising on the platform’s screen; Advertising on the flow of video content information; Look before you buy, TikTok celebrities with goods and other e-commerce models; Marketing training; Live rewards, and so on. Furthermore, TikTok short video thoroughly investigates traffic realization. It pays attention to content realization, attracting users to pay directly for short video content, realizing the unification of traffic realization and content realization, and ensuring the long-term development of TikTok short video.

Platform and business field

On September 26, 2016, an app named TikTok was launched on various software platforms, and it is the launch of this app that has become the leader of short video platforms. Toutiao incubated Tiktok, and TikTok was called Douyin in China at the very beginning. TikTok’s prominent positioning was a short video platform, providing users with a platform to record their lives and share. “Public values and the common good are historically and ideologically variable; they are the stakes in a democratic debate about the foundations of society. Creating public value is not the sole “Privilege of the Public Sector” (Dijck, 2018). It Is particularly important on media platforms because large media platforms have many users, and every news or short video they release will indirectly affect the public interest. This is also an important reason for Douyin’s popularity in China. In fact, since 2013, there has been a short video platform called Kuaishou in China, and in that period, Kuaishou was no less popular than TikTok now. It only took one or two years to set off a trend of short video shooting in China. And this trend was not brought about by Douyin but by Kuaishou. Kuaishou has always taken a centralized approach to development, as his ads show: “There is no high or low in life. Everyone deserves to be remembered.” Kuaishou does not label users and gives preferential treatment to Internet celebrities, so Kuaishou has been labelled as vulgar by the world. Kuaishou’s best days have ended with the Chinese government’s crackdown on Internet incivility, and Douyin was born. Douyin differentiated its advertising slogan from Kuaishou’s “Record a good life” as soon as it was launched, which means that Douyin mainly attracts young people from the first and second-tier cities and uses the combination of music and video pictures to improve the overall quality of videos.


How Tiktok makes money

Douyin’s current success is also closely related to COVID-19 in 2020. The Chinese people can only stay at home during the epidemic, and they need activities to pass the time. At this time, Douyin, which has just begun to become popular, has become more popular. Staying at home requires software that can pass the time, and Douyin gives people the opportunity to pass the time. But now Tiktok has 1.1 billion users worldwide, but how does Tiktok make money so that Bytedance is now worth 180 billion U.S. dollars. TikTok’s marketing method is not much different from Google and Youtube. Tiktok also intersperses advertisements in short videos and cooperates with well-known brands, etc., and information flow advertising is also the primary way for these media companies to make money. Another marketing method TikTok is very similar to twitch. “Like many other social media platforms, TikTok generates revenue through in-app purchases. The app provides from 100 to 10,000 virtual coins that range in price from 99 cents to $99.99.” (Lydia Kibet, 2021). For example, in April 2020, I also topped up nearly $1,000 in the TikTok live broadcast to give my favourite anchor pk (a game between anchors). I wanted to continue to recharge during the live broadcast, but later, because of other things, When I got busy, I never watched the live broadcast again.

The money TikTok earns from advertising and well-known brands is in the central part of TikTok’s annual profit, but the composition of this significant part is also different. In the essential advertising display, which is forced to display 5 to 10 seconds on the home page or one A.D. video for every 10 or 15 short videos, this is the most basic way to display advertising, just like Youtube often interlacing ads in videos and this kind of advertising will be more expensive. “TikTok generates revenue from A.D. Revenue and in-app gift daylight robbery” (Business Model Toolbox, 2021). The other advertising method is that the product side directly contacts the video creator and show it in the video, which is the most common advertising method in TikTok now because as far as I know, there will be advertisements in no less than 20-30 videos when I watch TikTok1 for an hour every day. The advantage of advertising in this way is to take advantage of the fans who like a particular video creator to trust and enjoy the creator so that they will believe the effect of the product and buy it.

Another profit model should not be available on Facebook and Youtube, which is to turn traffic into cash immediately. Because many video creators on TikTok need the traffic to expose their work to gain fans, there is this feature, which means that users can spend money to increase the exposure of their work to how many people, the current price is about 30 U.S. dollars Can be promoted to 10,000 people. And such expenses are unnecessary expenses for general users. Still, the small primary audience is ready to become video creators, but it will be helpful if they don’t have a particular fan base.

Concerns about tiktok

“An analysis of the videos served to these accounts found that through its powerful algorithms, TikTok can quickly drive minors—among the biggest users of the app—into endless spools of content about sex and drugs.” (Butler, 2021) The article also wrote that by detecting the TikTok algorithm, it was found that TikTok had pushed at least 569 drug and sex-related videos to a 13-year-old newly registered user. This is the last thing that should happen to a short video platform. Neither 13-year-olds nor adults should be pushed to drug-related videos, and even such videos cannot pass the background review. , And this has led to some flaws in TikTok’s videos. In the beginning, the requirement for short videos was like “recording a good life”, but now as more people start to get in touch with short videos, it will slow. Some essential differences pull down the overall video quality.


The emergence of TikTok is bound to bring people laughter and laughter and even becomes another kind of people’s daily life. However, the way that TikTok now operates makes it possible for advertisements to appear in one minute. I can’t help but think back to the days when I watched Douyin in 17 years, and I could watch short videos every day to bring laughter to myself and the people around me, but now TikTok has become a place to make money for many creators. “Yet it seems clear all social media—whether TikTok, Weibo, Facebook or Twitter—privilege state or corporate authority above the public’s interest. That makes them terrific vehicles for advertising and propaganda.” (Socolow, 2019) A platform that provides short videos and more has become a media platform with a certain degree of influence.

Name: Guoqiang He


Group 7



Dijck, V. J., Poell, T., & Waal, D. M. (2018). The Platform Society: Public Values in a Connective World. Oxford University Press.

GOBankingRates. (2021, April 24). How Does TikTok Make Money?

Business Model Toolbox. (2021, May 6). TikTok.

Socolow, M. J. (2019, November 2). The Trouble with TikTok. POLITICO Magazine.

Butler, J., Cooke, C. C. W., Geraghty, J., Pino, D., Downey, C., Geraghty, J., Downey, C., Evans, Z., Evans, Z., Evans, Z., The Editors, McCarthy, A. C., Hochman, N., The Editors, The Editors, Lowry, R., Lowry, R., McLaughlin, D., & McLaughlin, D. (2021, September 8). TikTok Is Evil. National Review.

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