78% of Small Businesses Say TikTok Ads Drive Profits—Majority Within 6 Months

More than half of small retailers and restaurants that use TikTok say it’s extremely valuable to their overall marketing performance, according to Capterra research

ARLINGTON, Va.--(BUSINESS WIRE)--As TikTok rises in popularity among consumers, there’s good reason for small businesses to pay attention to the hype, according to Capterra’s TikTok Marketing Survey. The survey found that 78% of small businesses that run ads on TikTok have already realized a positive ROI–the majority within just six months.

TikTok marketing yields undeniable power, especially with Gen Z. More and more consumers are turning to TikTok search over Google to find their next local boutique or restaurant. With Google and Meta’s advertising dominance fading, TikTok is becoming more advantageous for small and midsize businesses. In fact, one in ten surveyed businesses have gone viral on TikTok organically, indicating a level playing field that's not dominated by large name brands.

TikTok helps mitigate choice paralysis by giving users immersive, vertical videos that take them inside a business instantly, rather than sifting through text-heavy review sites like Google or Yelp. Given its success rate, 52% of TikTok marketers surveyed plan to spend more money on the platform in 2023. And only 18% of businesses not currently using it say they have concerns over its data practices.

“In response to Gen Z’s preference for TikTok as a search engine over Google Maps, Google plans to launch augmented search functions to rival TikTok reviews’ immersive, authentic qualities,” says Molly Burke, senior retail analyst at Capterra. “Users like TikTok because its seemingly endless content feels authentic and unfussy—videos made by real people, for real people. Creating ads that capture the candid nature of organic TikTok content helps businesses blend in and profit.”

More than three-quarters of businesses that use TikTok post organic content, while less than two-thirds run ads on the platform (some only use TikTok to discover trends or keep an eye on their competitors). Among businesses that post both organic and sponsored content, 72% say organic TikTok content is extremely valuable to their company’s overall marketing performance, while 55% say the same for ads.

“While other platforms' content suggestion algorithms can feel like an oligarchy dominated by legacy brands and Hollywood celebrities, TikTok’s ‘For You’ page has been characterized as a meritocracy where small businesses can reap rewards from both paid and organic content,” says Burke.

Capterra research overwhelmingly recommends TikTok for small businesses when used correctly. Read the full report on Capterra.com to see expert recommendations based on data and real testimonials from growing businesses, including Torchy’s Tacos and Roz Got Cake.

Businesses looking for tools to start creating TikTok content can check out Capterra’s list of the best social media management software or our recommendations for video marketing software.

About Capterra

Capterra is the leading software reviews and selection platform that connects businesses to the right technology. Compare software, read and leave reviews, and access objective insights that empower business growth. For more information, visit Capterra.com.