TikTok has rapidly grown to become one of the most popular social media platforms, especially among Generation Z. The short-form video app owned by Chinese company ByteDance was launched internationally in 2018 after acquiring Musical.ly. As of 2023, TikTok has over 1 billion monthly active users worldwide (Influencer Marketing Hub).
A key feature of TikTok is the ability for creators to go viral quickly. Videos can be discovered and viewed by millions of users. This has enabled the rise of influencer marketing on the platform. Brands partner with popular TikTok creators to promote products and services. According to Influencer Marketing Hub, the industry is projected to be worth $21.1 billion in 2023.
How TikTok Works
TikTok is a social media platform focused on sharing short videos. Users can upload videos up to 60 seconds long on TikTok. The videos are typically fun, entertaining clips – anything from pranks and dance videos to comedy skits.
Once a video is uploaded, other TikTok users can view, like, comment on, and share the video. Videos uploaded to TikTok have the potential to go viral very quickly. The app’s algorithm is designed to determine which videos users will find most engaging and then promotes those videos. Trending songs, dances, or challenges will often spread rapidly among TikTok users.
A key aspect of TikTok is its “For You” page. This is an endless feed of videos recommended to each user based on their interests and engagement. So TikTok is constantly learning about users’ preferences to customize the video feed.https://www.pocket-lint.com/what-is-tiktok/
TikTok’s Creator Fund
TikTok launched the Creator Fund in 2020 as a way for popular creators to earn money directly from TikTok (1). The program is only available in certain countries, and creators must meet eligibility requirements like having at least 10,000 authentic followers and posting original videos that follow TikTok’s community guidelines.
TikTok sets aside a large fund each month that it divides among creators based on the engagement and views their videos receive. Creators can’t apply for the fund – TikTok automatically enrolls eligible creators and informs them via email. There is no cap on earnings through the Creator Fund.
To access earnings, creators must link their TikTok account to a PayPal account. Funds are paid out monthly as long as the creator remains active and in good standing. In the Creator Portal, creators can view metrics like views, engagement, and estimated earnings (2).
(1) https://www.tiktok.com/creators/creator-portal/en-us/getting-paid-to-create/creator-fund/
(2) https://www.tiktok.com/creators/creator-portal/en-us/getting-paid-to-create/creator-fund/
Sponsored Content
One of the main ways TikTok creators earn money is through sponsored content and brand partnerships. Brands will pay influencers to create branded content promoting their products or services. The rates for these sponsorships vary greatly depending on the influencer’s follower count and engagement levels.
According to industry data, nano influencers with 5,000 to 20,000 followers can earn around $10 to $100 per sponsored post. Micro influencers with 20,000 to 100,000 followers typically earn $100 to $250. Macro influencers with 100,000 to 1 million followers earn $250 to $750, while mega influencers with over 1 million followers can earn $750 to $3,000 per sponsored post [1].
The top TikTok celebrities with tens of millions of followers can earn up to $500,000 for a single branded video. For example, mega influencers like Charli D’Amelio, Addison Rae, and Loren Gray regularly earn over $100,000 per sponsored post.
Besides one-off sponsorships, many creators also have long-term brand endorsement deals. These involve an influencer repeatedly featuring or incorporating a brand into their content over an extended period of time. The compensation for these deals is negotiated but can be extremely lucrative, sometimes running into the millions for top influencers.
Affiliate Marketing
Affiliate marketing is a popular way for influencers to earn money from their TikTok content. Influencers promote products or services and receive a commission when someone makes a purchase using their affiliate link or promo code. According to Influencer Marketing Hub, affiliate marketers typically earn between $0 to over $100,000 per month depending on their reach and influence. Beginners may only make $1,000 per month, while more established influencers can make over $10,000 per month with affiliate links.
TikTok influencers often include affiliate links in their bios or descriptions to monetize their content. They may promote a certain product in a video or tell followers to use their promo code at checkout to receive a discount. According to Business Insider, micro-influencers with 5,000 to 100,000 followers can make $100 to $2,000 per month with affiliate marketing. Nano-influencers with 1,000 to 5,000 followers may earn around $100 per month. The earnings potential rises for influencers who can drive a high volume of traffic and sales to affiliate offers.
Livestreams
One of the top ways TikTok creators can earn money is through livestreams. During a TikTok livestream, fans can send virtual gifts and donations to show their support. Each gift is worth a certain amount, with more valuable gifts costing more “coins,” TikTok’s virtual currency. According to NFI, gifts range in price from 5 cents to $500.
For every livestream, TikTok takes 50% of the revenue from gifts as a platform fee. The other 50% goes directly to the creator. So if a fan sends a $10 TikTok gift, the creator earns $5. This means creators can earn a significant amount during a popular livestream, especially those with a large following.
According to Business Insider, ASMR creator Lucy Davis said she earns between $20 to $300 per livestream. The earning potential increases along with the number of followers. Large influencers with millions of followers can earn thousands per livestream from virtual gifts alone.
Merchandise
Selling branded merchandise is another way influencers can generate revenue. Many influencers create custom apparel, accessories, and other products featuring their brand name, logo, or catchphrases to sell to their fans. According to one source, some influencers have earned over $40,000 in a single day from merchandise sales (Business Insider, 2022). However, on average, merch accounts for only about 7% of influencer earnings (Business Insider, 2022).
Still, merchandise can be a lucrative revenue stream for some influencers. Products like custom t-shirts, sweatshirts, hats, phone cases, and more can strengthen the influencer’s brand and give fans a way to publicly show their support. Influencers with highly engaged audiences often benefit the most from merchandise sales. Establishing an online shop to sell merch requires an initial investment but can create a passive income stream over time.
In summary, while most influencers generate only a small percentage of their income from merchandise, some have leveraged this strategy for short bursts of very high sales. Branded merch allows fans to engage with the influencer’s brand and can be a profitable endeavor.
Nano and Micro Influencers
Nano and micro influencers are content creators with smaller followings, usually between 1,000 to 100,000 followers. Despite their smaller audience size, these influencers can still earn significant income from their TikTok videos.
According to a recent study, nano influencers with 1,000 to 10,000 followers can earn around $30 to $500 per sponsored TikTok post. Micro influencers with 10,000 to 100,000 followers typically earn between $100 to $500 per sponsored post.
While the earnings per post may seem small, nano and micro influencers can do multiple brand partnerships per month. This allows them to generate a respectable monthly income in the hundreds or low thousands of dollars. Their high engagement rates also make their content valuable for brands looking for authentic promotions.
Additionally, smaller influencers have lower sponsorship rates, making them accessible for businesses of all sizes. Their niche audiences and hyper-targeted content also deliver efficient results for brands.
In summary, while they have smaller audiences, nano and micro influencers find financial success on TikTok by regularly collaborating with brands. Their high engagement and niche audiences provide strong value at affordable rates for businesses.
Mega Influencers
Mega influencers on TikTok are creators who have amassed millions of followers. According to Forbes, the top earning mega influencers on TikTok in 2022 were:
Charli D’Amelio – $17.5 million (133 million followers)
Bella Poarch – $5 million (87.5 million followers)
Addison Rae – $8.5 million (86.3 million followers)
These creators earn income through TikTok’s Creator Fund, brand sponsorships, merchandising and other business ventures. For example, Charli D’Amelio has partnered with brands like Invisalign, Morphe cosmetics and Dunkin’ Donuts. She also sells branded merchandise and books.
According to Dexerto, Charli makes around $242,700 per sponsored TikTok post thanks to her massive following. The highest paid TikTok stars can make hundreds of thousands per sponsored post.
However, despite their huge followings, mega influencers do not necessarily earn the highest rates per 1,000 views compared to nano or micro influencers. But their overall earning potential is multiplied by their enormous audience reach.
Conclusion
In summary, there are several key factors that determine how much money TikTok influencers can earn per 1,000 video views:
- Participation in TikTok’s Creator Fund, which pays around $0.02 to $0.04 per 1,000 views.
- Sponsored content deals with brands, which vary hugely based on follower count but can pay anywhere from a few hundred to several thousand dollars per sponsored post.
- Affiliate marketing through links in bios and promo codes, which earn a small commission per resulting sale or app install.
- Tips sent during livestreams, ranging from a few cents to hundreds of dollars per live video depending on follower size.
- Merchandise sales from promoted products.
On average, nano influencers with 5,000-20,000 followers can expect to earn $5-60 per 1,000 views. Micro influencers with 20,000-100,000 followers can earn around $20-250 per 1,000 views. Mega influencers with millions of followers have much higher earning potential, easily making upwards of $500+ per 1,000 views.
The key takeaway is that while TikTok views alone will not generate much revenue, influencers have various options for monetizing their audience. Overall earnings per view increase significantly with follower count, but even nano influencers can utilize TikTok to earn money.
