The social media giant is facing intense scrutiny across the pond, and this could have consequences for UK small business owners
On 24th April this year, the US Senate approved legislation to ban one of the world’s most popular social media platforms, TikTok. Just hours later, President Biden signed the bill into law. Now, the future of the app in the US is murky, as its parent company — ByteDance — must sell it to non-Chinese owners are face a blanket ban across the country.
TikTok has more than a 150 million users in the US alone, and many fear that their favourite screentime pastime may soon disappear for good. However, those who stand to feel the loss more than any other are creators and small businesses, even those on UK shores.
A colossal loss
Without the hugely popular social media platform, creators and small business owners alike could see their revenue plummet alongside their audiences, potentially having a global impact.
Despite being based in the UK, even small British businesses often operate on an international level, utilising social media to expand their reach and find new customers. In fact, earlier this year TikTok reported that small- and medium-sized businesses on the platform contributed a staggering £4.12 billion to the GDP of Germany, UK, France, Italy, Belgium, and the Netherlands alone.
With the threat of a US ban growing stronger, global businesses are trying to find new ways to shout about their products, services, and content. This could be an uphill battle.
A ripple effect
Understandably, US creators and businesses are particularly concerned about a potential ban. Speaking to the BBC, US content creator Shira (@shirashiraonthewall) described the prospect of a ban as “devastating”, having spent years streaming, posting and editing in what has been a “difficult journey.”
However, it’s not just US creators who fear what a ban would mean for their revenue. In March, a TikTok Canada spokesperson told Global News that “banning TikTok in the US would be devastating to Canadian TikTok creators and small businesses, many of whom rely on being able to reach Americans as a large part of their audience.”
Elsewhere, cosmetic and skincare brands from Korea and China would also feel the loss.
In the UK, fears are just as strong. TikTok Newsroom reports that more than a third (34%) of small and medium businesses on the app say they have increased sales of their products or services as a direct result of advertising on TikTok. Removing the opportunity to do this with potential US customers could cut a significant chunk from the audiences they’ve come to rely on.
Adapting to change
A ban would no doubt be difficult for businesses around the world, but it may not spell disaster. Instead, experts say organisations will be forced to adapt , shifting their operations to other online platforms.
This is a sentiment shared by professor of management at Purdue University Daniels School of Business, Mohammad Rahman, who says: “We’re living in a digital economy… and we’re basically relying on technology for all kinds of communication and information.” Going to back to how business was conducted before social media likely wouldn’t work because “consumers around the world have changed in terms of how we decide what to buy.”
If the ban goes ahead, ByteDance will have at least 270 days to sell TikTok, giving businesses some breathing room to seek out other alternatives.
Next steps
According to Enterprise Nation, TikTok is now used by 1.5 million UK small businesses. Of these, 75% say that the app has had a positive impact on their ability to reach customers both in the UK and beyond, while 74% say it has helped them engage with more customers, according to TikTok Newsroom.
The potential ban will be a long process, with many hurdles in place, so your TikTok customers aren’t going anywhere for the time being. Despite this, ignoring the problem isn’t going to make it go away.
As with many things in life, an honest approach is best. Small businesses have the advantage of being able to really connect with their customers, so don’t be shy about sharing your concerns with them, and inviting them to support you in other ways. In doing so, you’ll build bridges and make your audience stronger in the long run.