Brands Brace for Impact as TikTok Faces Criticism

Amid debate in Washington over whether TikTok should be banned if its Chinese owner doesn’t sell it, one group is watching with particular interest: the many brands — particularly in the beauty, skin care, fashion, and health and wellness industries — that have used the video app to boost their sales.

Youthforia, a makeup brand with more than 185,000 followers on TikTok, is thinking about moving more marketing to other platforms, like YouTube and Instagram. Underlinings, which makes the popular brand Nailboo, planned to use TikTok to launch a product with a major retailer in August and is now wondering if it will have to change course. And BeautyStat, which sells skin care products on TikTok Shop, can’t even fathom the idea of the platform’s disappearing.

TikTok is “just too big, especially in beauty and in certain industries, I feel, for it to disappear,” said Yaso Murray, BeautyStat’s chief marketing officer.

Companies and creators have known for years that TikTok could be at risk. But those fears seem more real now that the House has passed a bill that would ban TikTok in the United States unless its owner, ByteDance, sold it. (Since that vote last week, the bill’s progress has slowed in the Senate.)

Some lawmakers in Washington think TikTok is a platform for spying by the Chinese government. Parents fume that it is rotting their children’s brains. But lots of companies — big and small — credit TikTok and its band of influencers for getting their products in front of potential customers, especially young ones.

Retailers, whether Sephora, Walmart, Target or Amazon, have also been big beneficiaries of TikTok, said Razvan Romanescu, chief executive and co-founder of Underlinings and 10PM Curfew, a firm that connects content creators with brands.

“If something goes viral on TikTok, they sell out,” Mr. Romanescu said. “So I feel like the whole ecosystem is driven by the discoverability that TikTok provided.”

For some brands, TikTok has become an integral piece of marketing strategy and sales growth. That’s partly because the short videos are easily digestible by consumers and partly because marketing on the platform is relatively inexpensive for smaller brands. TikTok Shop, which started last year and allows shoppers to buy products directly on the app, has become particularly popular among beauty and fashion brands.

“Pre-Covid, the beauty category was pretty flat, maybe growing a couple of percentage points each year,” said Anna Mayo, a vice president of beauty and personal care at NIQ, a research firm. But during the pandemic, when consumers had more time on their hands and Zoom calls became more popular, TikTok beauty and skin care videos exploded.

“Since then, the beauty industry has been all about growth and hasn’t slowed down,” Ms. Mayo said. “TikTok is a big driver of that growth.”

New products or clothing can be highlighted by individuals who, unlike movie stars or models, feel more relatable to viewers. The quick how-to videos can show the best way to mix and match spring sweaters and jeans or the order in which to apply toner, serums, moisturizers and sunscreen in a morning skin care routine. Some people say they go to TikTok before Google for shopping.

“The first video was a makeup tutorial, showing you how to flawlessly cover acne using three products,” said Mikayla Nogueira, a 25-year-old influencer who started making TikTok videos four years ago. “In just 60 seconds, you learned a new skill.”

That was when Ms. Nogueira had time on her hands after her university shut down classes and Ulta Beauty, where she worked, closed its stores because of the pandemic. Today, she has 15.5 million followers on TikTok and works regularly with beauty and skin care brands.

While larger companies can spend marketing dollars across a variety of sites, TikTok offers a more affordable advertising channel than platforms like Google and Meta, which owns Instagram.

“For a direct-to-consumer business like ours, the platform is very unique,” said Nadya Okamoto, who started posting TikTok videos about the organic menstrual products of her company, August, in the summer of 2021.

First, TikTok’s “For You” feed is constantly putting August’s videos in front of new consumers, not ones who have chosen to follow the brand on other social media platforms like Instagram. Second, the platform allows Ms. Okamoto to be an in-house chief content creator.

“Other brands are spending hundreds of thousands of dollars each month on advertising, and we’re spending next to nothing,” she said.

Asked about a possible TikTok ban, Fiona Co Chan, the chief executive and a co-founder of Youthforia, said, “I don’t know that anything would fill the hole the same way.”

TikTok allows Frida to talk about its baby and postpartum products in a way that other advertising and social media platforms may see as taboo, said Chelsea Hirschhorn, the company’s founder. The brand was a relative latecomer as an active user of the app — ramping up its posts starting about a year ago — but has about 123,000 followers and has had several videos go viral.

Still, Ms. Hirschhorn said, there are legitimate concerns about TikTok’s going away or changing in some way, and Frida isn’t overly reliant on the app. It has figured out how to advertise both in traditional forums (it’s now sold in 4,000 Walmart stores in the United States) and in more creative ways (sponsoring Jason Kelce’s pregnant wife, Kylie, at the Super Bowl when his Philadelphia Eagles played in the game last year).

“I think it’s really important that brands have a bulletproof, robust marketing plan in a variety of media channels, both traditional and emerging, in order to weather any prospective challenge,” Ms. Hirschhorn said.

While some companies work on contingency plans for new products, others are watching and hoping legislators won’t ban the platform.

At BeautyStat, Ms. Murray said she was “trying not to get too alarmed by everything that’s going on because I think a lot of brands would suddenly experience a big hole in their sales.” She added, “It would be very damaging.”


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