TikTok’s cultural clout is undeniable, but what about advertising dollars? Not quite there, yet.
That’s where Smart+ comes in: TikTok’s answer to Google’s Performance Max and Meta Advantage+, the AI-powered ad buying tools that promise to simplify campaign management, paving the way for marketers to spend their advertising dollars more freely.
Officially launching today (October 7), Smart+ automates everything from creative development to targeting and optimization, simplifying the entire process of buying ads on the app.
Essentially, marketers can let TikTok’s AI handle the heavy lifting: creating and serving ads to drive conversions, leads, or app downloads. However, they also have the ability to take control at key stages, as Smart+ offers the flexibility to use its features selectively.
For example, marketers can use the tool to create and optimize ads and then choose whether to manage campaigns themselves or hand over control to artificial intelligence. This modular approach allows marketers to choose which features to leverage, distinguishing it from competing solutions that often require full commitment to the entire suite.
This flexibility could alleviate concerns that tools like Smart+ require marketers to cede too much control to inscrutable algorithms.
However, it also highlights a more significant problem with tools like Smart+: while these “black box” models promise improved performance through advanced machine learning, they require a heavy dose of trust from marketers, who often lack the vision and control that they are used to. .
However, many seem willing to give up some oversight in exchange for faster results and better ad performance.
This is exactly what TikTok is aiming for with Smart+. The pitch is all about simplicity and speed: no more weeks of guesswork and endless A/B testing, according to Adolfo Fernandez, TikTok director, global head of product strategy and operations, commerce.
With TikTok’s AI already trained on what drives successful ad campaigns on the platform, advertisers can expect quick wins with fewer hassles, he added. The same goes for creativity; Smart+ is connected to TikTok’s other AI tool, Symphony, which is designed to help marketers generate and refine ad concepts.
“Advertisers who optimize value with Smart+ web campaigns see an average of 53% improvement in return on ad spend [compared to without it]”Fernandez said.
Ray-Ban is an example. Over the summer, the brand launched a Smart+ beta campaign that reduced the cost per acquisition by 50% compared to previous campaigns without the tool. Conversion rates increased by 47%, resulting in a 42% increase in return on investment for the eyewear brand.
Results like this are designed to appeal to a specific type of marketer: the type who have thus far avoided TikTok, unsure whether the platform can deliver faster results, or who are unwilling to spend the time and money to find out. Smart+ is how TikTok attracts them. And if it works, it could reshape TikTok’s advertising business, making smaller advertisers the bedrock of its growth, just as Meta and Google have done.
“In my mind, with the advent of Smart+, the gap with Meta will close almost completely,” Blake Chandlee, president of global business solutions at TikTok, told Digiday. “That [Meta’s Advantage+] it was truly the benchmark of the sector. Historically, we have been very strong in branding, to the point where our branding products outperform anyone else on the market. But our high performance products [especially including Smart+]I think it might be a tie.
However, bridging this gap won’t be easy: TikTok’s advertising business still has some catching up to do with Meta.
TikTok’s worldwide ad revenue is expected to reach $22.32 billion by the end of the year and increase 27.3% to $28.42 billion by the end of 2025, according to the March 2024 forecast by eMarketer. By comparison, Meta’s worldwide ad revenue is expected to total $154.16 billion by the end of this year, rising 23.2% to $173.92 billion by the end of 2025, according to eMarketer.
“Automation is a critical step for us as it allows advertisers to further invest in TikTok and get an even greater return on investment,” said David Kaufman, global head of monetization products and solutions at TikTok, during the TikTok .
Shop continues to be a key cog in these plans, so much so that it has launched its own AI tool to boost merchant sales. Called GMV (Gross Merchandise Value) Max, the AI tool automatically tests and selects the best-performing creative assets for sellers. Optimize traffic, organic content, paid ads, and affiliate posts to reach shoppers across TikTok’s entire shoppable space, from the For You page to the Shop tab, and even in search results. However, it cannot optimize return on sales, only overall ROI within TikTok. But TikTok executives don’t see this as a disadvantage: in fact, they think it’s a feature, not a bug.
“When you put it in perspective, the shift from ROAS to overall ROI represents a major step forward in our vision of moving from being a media partner to becoming a true business partner for our clients,” Fernandez said.
Put another way: TikTok wants to emphasize broader business outcomes — like long-term growth and marketing efficiency across its ecosystem — rather than simply driving immediate sales through ads. And early test results suggest it might be onto something: Merchants using GMV Max have seen an average 30% increase in gross merchandise value, according to Fernandez.
Taken together, all signs point to a shift in how TikTok targets marketers. The company wants to be seen as more than just an entertainment app where users kill time by watching viral videos. It is becoming a platform where people choose to spend their time, and with this change in mindset, they increasingly search, discover and buy what they see.
To prove it, TikTok’s head of measurement product operations and solutions pointed to some compelling numbers. “Research shows that 79% of TikTok-driven purchases are not attributed to the platform and conversions are undervalued by 73%,” said Ann Nguyen, head of measurement product solutions and operations at TikTok.
According to the executive, this trend has been around for a while: existing measurement tools simply couldn’t capture it. So instead of waiting for third-party metrics to match, TikTok created its own.
When external data didn’t tell the story they wanted, TikTok created its own narrative, supported by its own tools, including conversion lift studies. These studies measure sales that would not have occurred without a TikTok ad and use a randomized controlled trial approach similar to that used in scientific research. TikTok executives are encouraging Smart+ advertisers to take advantage of these studies, although marketers will also have the option to use their own tools.
“They consistently demonstrate that TiKTok is a highly incremental, demand-generating platform with results that far exceed last-click attribution,” Nguyen said. “Advertisers, for example, see on average an increase in conversions of at least 25%.”
This isn’t a new tactic: Google and Meta have both exploited similar strategies for years to build an “undervalued and underinvested” narrative. But TikTok is trying to set itself apart by focusing on privacy-enhancing technologies, such as clean data rooms and trusted execution environments, to keep marketers’ data safe while demonstrating its value.
And as TikTok repositions itself as a serious player in advertising, the pressure is on to prove it can deliver what matters most: profits.
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