Business of Apps – TikTok Audiences – Andre Kempe

Intro: This is the Business of Apps podcast, bringing you actionable insights from the leaders of the global app industry and the world’s fastest-growing apps. You can find more app news, data, and analysis over at Businessofapps.com.

Artyom: Welcome to the Business of Apps podcast. On this show, we invite app industry professionals to cover various topics. We promise to do our best to keep it both insightful, and brief. In this episode, we have Andre Kempe Kempe, the founder of Admiral Media. Andre Kempe, welcome to the business of apps podcast.

Andre Kempe: Thanks Art. Thanks for having me.

Artyom: Awesome. Thanks for coming to the show. Okay, so this is the question to the audience hypothetical question. So may I ask you, are you on TikTok? Do you have any experience with this advertising platform? Perhaps you’ve heard about it, but you believe that you can only reach a young audience gen Z, perhaps millennials, and that’s it. But as a matter of fact, that’s not the case. With TikTok what happens is in a campaign, you can reach multiple generations and this is what we’re going to be talking about today. But before doing that, Andre Kempe, please tell us about yourself. How did you get involved in app marketing?

Andre Kempe: Yeah, thanks for the quick intro. Well, I got involved in app marketing some years ago. I think when let’s say the second iPhone came out or something like that. So it’s been a few years now. I was working in the ringtone business before and then switched over to selling app development to other companies. And then I moved over to, because this was really not successful because everyone said, I don’t need an app, but at some point I switched over to app marketing. When someone asked me, Hey, do we want to push some exo files fast? And this is how I got involved, basically.

Artyom: It reminds me of those days, back in 2009, 2010. App marketing in those days was different. So to begin, let’s talk about video ads in general, can you give us kind of a quick sketch of how video advertising evolved for the last 10, 15 years? I’m taking 10, 15 years, because this is roughly like the age of YouTube, like the biggest player in the video space.

Andre Kempe: You actually just want to remind me that I’m almost 40 now. But just a little bit like, with this question, I remember a little bit of the TV show on Netflix called Madman. When Don Draper was introduced to TV advertising, it feels pretty much the same for me, at least, because I grew up in a world with no mobile phones. Let’s put it this way. I come from Eastern Germany. We didn’t even have bananas. So that day when the first time I had a mobile phone in my hand, it was so clear to me that there’s a big change coming up. And I was pushing my career in this direction very heavily. I didn’t want to get involved in anything else. And later on, this industry has developed so fast and so dynamic, video advertising didn’t take long.

I mean, I was trying. At the beginning of my career, when I think it was called UTMS, was a connection type thing like LTE today, I was trying to sell video calls solutions to some companies where they had to pay per minute and these kind of things. And from that, it had developed into video advertising later on when internet was really fast and available for everyone, basically. So coming with the speed of the internet, the quality of advertising developed very quickly and nowadays and what we see on our phones. It’s not only that, let’s say video quality has developed a lot, but also the creatives or the creative input has developed a lot. So people got much, much smarter on how they can present their products on the mobile screen and how they get us to click on certain things or download certain apps and buy products. So within the last 10 to 15 years, I would say, this has become the thing, when we talk about advertising. Today you have to publish video ads to be relevant in the industry.

Artyom: So obviously, I mean, anybody who’s listening to his show saw an ad on TV, on his smartphone or his computer. He knows that there’s a certain duration that video ad. And I don’t recall any video advertising that is longer than 60 seconds. People are sticking to the shorter form, like 15, 10, 20 seconds. Sometimes even shorter, like six seconds video ads that are really impactful and compact. So let’s talk about the current state of video advertising and why short form video is actually the king of the game right now. Why is it dominating? Why is every platform, every advertiser is stick into this short form BDL?

Andre Kempe: There are certainly a lot of studies out there that talk about how attention span has changed among the people that use digital products, or let’s say digital mediums like phones or computers. And since there’s not only YouTube anymore, which got so big. And so this with long-term tutorials play through, and these kind of things, all the other channels from Instagram to Facebook and so on, they have trained us and our attention span to become much, much shorter. And this obviously applies then to the advertising that we are willing to consume. I mean, nobody gets around advertising. Even if you have an ad blocker on your desktop browser or something, you will always see an ad somewhere. So there’s no way around it. And the willingness to put concentration on something to let’s say, empower your brain to digest what you are seeing. I think this has been reduced a lot because of those channels and how people are posting social content on those channels. 

And you have to really compress the information that you want to transport into this very short form videos nowadays. And this also means that if you are producing an ad creative, you have maybe one second to get the attention from a user. So this can either happen through, let’s say, through some shocking moment or through the use of color or anything, but you definitely have to catch the user within the first second. Otherwise your creative is lost and nobody recognizes it.

Artyom: They have to trigger an emotion. If your ad is not emotional, people would just escape it. And it’s certainly true that there’s no way you can actually produce a video and on certain duration, then just cut it in half and take first five seconds for the other platform. It’s not going to work. 

Andre Kempe: That’s still something big brands are doing, and I’m not sure where this comes from, we see the advertising.

Artyom: For people being lazy or they don’t have much time, probably they think it’s going to be okay, it’s going to work out. Probably they believe when you have a big brand, you kind of think it’s going to play out anyway, because you’re a big brand. 

Andre Kempe: And certainly let’s say this is 50% of the truth. I was involved in bigger brands advertising campaigns. And let’s say that not only the processes behind getting creative produced, but also the investment that they put into production is much, much higher than what we are used to get in, let’s say app-centric businesses. So we probably have to distinguish between, let’s say, old economy businesses, or traditional businesses and companies where the core of their business is the app itself. So they certainly have a completely different approach when it comes to production processes and investments in creatives.

Artyom: So this is the difference in the thinking of different generations.

Andre Kempe: Absolutely. Yes.

Artyom: Yeah. So that’s why it’s kind of hard for big brands if they don’t have understand folks from the age where video advertising is given, something that it’s not feasible to go online and not see an ad and actually to see an ad in your phone. So you have to be native to the advertising in a short form. So it’s kind of a good segue for us to go to the TikTok area and talk about why TikTok is the king of short term video ads right now. And how is the platform different from Instagram, Snapchat, and YouTube, those big giants that dominate the market?

Andre Kempe: I think we have to split out YouTube a little bit, because this comes from a very different age first of all, like it’s existing just so long already that it just addresses a different audience and different kind of creators I would say and it’s not a social communication, typical app or a website, let’s say. While Snapchat is certainly something where I communicate directly with other people and can publish it publicly so I wouldn’t compare those directly. But let’s put TikTok, Instagram and Snapchat on the same level. I think that TikTok is dominating at the moment because the creators found a channel that was just massive in reach. And there was literally not a lot of competition at the very beginning. So between creators, I mean the creators themselves compete against each other, who has more reach, more followers, more likes, whatever.

And it was super easy to get massive reach on TikTok and on Facebook, we all know that your organic reach literally goes down to zero. You’ve got to pay for your reach at the end of the day. So while publishing on a platform like Instagram, where you might get a few likes, but on TikTok you can become super successful overnight when you have just one funny video. So I think that’s one of the reasons why TikTok became so popular, their algorithm, everyone was talking about pushed this a lot in the right direction for the creators, I believe.

Artyom: Alright. So obviously creators need audience. They wouldn’t be creators if they didn’t have any audience to create something for. So what kind of people are on TikTok right now? What audiences are there and what kind of audiences brands developers can reach on TikTok?

Andre Kempe: Before I answer the general audience consumer basis let’s say question, let me get to this point about where creators need an audience otherwise they are not creators. At the moment we are for example, looking for some clients to acquire creators, to buy their content. But we are looking at creators that have literally no followers, but still make kind of good content. And the reason is we want to buy those videos and use them for our performance ads. So basically we are looking for real life testimonials that we can use as an ad on our paid acquisition campaigns. And so they are still creators in some way, but they just have not a traditional followership yet. They might get, because we can make them very famous with those apps, at least they get known among millions of users across the globe. So this can definitely be helpful for them and for us as advertisers. 

And now about the audience, what you are asking, like who is really using TikTok. Most of the clients that I’m pitching or asking if they want to be on TikTok, they come back with yeah, but this is only 12 year old girls. So it doesn’t make sense for us. We want to sell cars, something like that. But I mean, have you looked up the word cars on TikTok? I mean, this has like 17 billion views on this one little hashtag and this 17 billion views on that hashtag is not generated by 12-year-old girls because they are not interested in cars. And then another example, go into the search bar and type in moms of TikTok. You will be surprised how many moms are on TikTok.

And this is the audience that I want to address for most of my clients. I mean, they want people who are able to purchase things. People who have credit cards and moms of TikTok are the perfect audiences. And this is not only the creators that are there. It’s also the viewers of this. So, I mean, who’s really watching moms of TikTok hashtags for what I mentioned cars? That’s not 12-year-old girls. And we did maybe one last sentence to this. We did some targeted campaigns for some apps, for example, a nutrition app, where we have a target of 25 years plus let’s say because this is just not converting to a subscription for younger audiences on any other channel. And we figured out that we can reach the exact same audience on TikTok that we reach on Facebook.

Artyom: Good question. When you’re targeting your ads on TikTok as I know from personal experience Facebook has lots of interests that are kind of helping you to form, and narrow your audience really nicely, but what about the same tools on TikTok? Can you do the same? Like relying, not only on I know the demographics but on specific interests?

Andre Kempe: Yes, you can do that. It’s maybe not as granular yet. So you have broader interest categories. 

Artyom: That’s getting there.

Andre Kempe: But it’s getting there definitely. And then you can also build your own audiences and lookalikes and this kind of thing. Demographic targeting, gender, age, location, language, OS, Wifi connection or not. So all these options are there.

Artyom: Yeah. I see. So pretty similar in this respect to Facebook. Before asking my next questions, I’m just going to say, thank you for making true the dream so young creators who are at the very beginning of their path, and you can actually help them to break through, giving them chance that they may not have otherwise. So let’s talk about the specific ad products that are available on TikTok for advertisers. So what is the toolbox?

Andre Kempe: It’s pretty much, let’s say what TikTok did well for advertisers is that they, I would say it’s like the typical Chinese style of creating new products. They copy up to innovation. So they actually made a clone of the Facebook dashboard and the next level will be innovation for sure, for advertisers. So you have the same ad products that you could buy on any other platform. So from video views to reaching frequency, app installs, or web conversions, it’s all there. You can super easily integrate your pixels and MMPs for app tracking, so that’s all there and easy to handle. And talking about brand advertising, let’s say, if I was a famous sugar drink, then you could buy it. When you open TikTok in a certain country, let’s say, the United States, you could buy this placement. Every user who’s opening that app on a given day, you are the very first advertising or the very first video that any user will see on that day. So some super effective reaching frequency ads are possible here.

Artyom: Yeah, it’s interesting. I don’t recall. And it’s similar to other platforms, but I bet it’s pretty expensive.

Andre Kempes: Depends. Let’s say price comparison-wise, it’s still much cheaper than any other platform. Let’s say I don’t have the prices off the top of my head. And they certainly changed from time to time, but because they just recently launched Germany as a new market, as a target market for advertisers with early access. And luckily we got in there and from there I know that they offer the package for the first video that everyone sees including sound. So they make a difference with sound and no sound. You got this thing for 65,000 euros, I think. And then all users in Germany that open TikTok would see your video first thing before anything else comes up.

Artyom: Yeah. It’s pretty impressive. If it depends on your marketing budget, probably. For a big brand, it could be good. And that spent, it’s a matter of how can you justify this campaign with that budget.

Andre Kempe: To be fair, if you compare the CPN, so the actual price that you pay per thousand users, we made a comparison for the auction ads. So the normal performance-based ads, and you can buy the reach for like 90%, less than on Facebook as an example. So you reach an audience that is not over-advertised yet, and you have quite exclusive access to this audience on a given day at a much cheaper price level. So it’s absolutely worth the effort and let’s put it this way, you always were a part of the winning team when you were someone who entered the market first.

Artyom: Yeah. That’s for sure. So what do you think means to be fixed, polished, or improved on the TikTok platform right now? You have firsthand experience. So what do you think?

Andre Kempe: Let’s say, I think the biggest issue that we still have is bulk editing, but that’s a common issue on all platforms. I mean, they do a pretty good job with the dashboard, but they’re certainly improvements possible when it comes to bulk editing copy or bulk editing a video creative. Anything else I think is pretty good what they have.

Artyom: Yeah. I think it’s just, one of the growing pains, Facebook used to have the same problem with bulk editing. So there’s nothing, it sounds like something unique for TikTok. So I think they’re going to go through this. Alright. So now we have this part of a show where I have a few questions directly for you. Are you iOS or Android person?

Andre Kempe: iOS.

Artyom: Alright. So one more person to the iOS.

Andre Kempe: I don’t need to give a reason do I?

Artyom: Yeah. That’s funny because if you’re an Android person you may ask a person a question why exactly? But if it’s iOS, it’s just like by default. What was your first mobile phone, if you can remember? 

Andre Kempe: It was a Bosch. I’m not sure which kind of phone, but it was a server. It had a little antenna and I bought it because it had a blue display. Blue, monochrome display, that looked really fancy.

Artyom: They were doing smartphones? I get it just a flip form. But they were in this business.

Andre Kempe: Absolutely, for a very short period of time. 

Artyom: It’s news to me. Let’s get back to this. What is your favorite app right now?

Andre Kempe: Ooh, I wouldn’t say I have the one favorite app. I certainly have favorite apps for certain use cases. For example, for email, I use outlook for communication. I certainly use WhatsApp. Or nowadays it’s like actually because most of my communication is business related. So it really depends a bit of music, obviously Spotify. 

Artyom: Alright. If you’re looking at your app, you probably are waiting for some new tech that will make those apps better for you to make a better experience in making more out of those apps in your daily life. So what kind of technologies are you waiting for?

Andre Kempe: Let’s say having iOS 14 in my mind. There’s probably something I’m looking forward to how the advertising industry adapts to that. So that’s certainly the biggest pain I have in my head right now. And then the next is probably related to certainly all these privacy laws. So how can we as advertisers step to those developments?

Artyom: Yeah, it is certainly a complicated matter. Alright. Actually, that was my last question. But before I let you go, how can people know more about what you do?

Andre Kempe: Well, just connect with me on LinkedIn or follow me on Twitter, reach out to me. So those are probably the best ways.

Artyom: Terrific. Thanks a lot for your time in coming on our podcast, Andre Kempe.

Andre Kempe: Thank you very much, Art. Have a good day. 

Artyom: Thank you. Bye-Bye. That was Andre Kempe Kempe founder of Admiral Media. To listen to more episodes, subscribe to our podcast on iTunes, Spotify, and Stitcher, just search for “Business of apps” and you will find us easily. Once you subscribe, you’ll be able to get new episodes on your smartphone, tablet or computer as soon as we release them. And please don’t forget to leave us a review and comment. It is highly appreciated and all episodes will also be available on the business of apps.com. See you next week.

Outro: This is the business of apps podcast, bringing you actionable insights from the leaders of the global app industry and the world’s fastest-growing apps. You can find more apps news, data, and analysis at Businessofapps.com. Thank you for listening to the business of apps podcast. For more head on over to Businessofapps.com.

 

 

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