Advertising always starts at a loss, but it should end in a profit. Return on investment (ROI) is the most important budgeting metric for you to know. When you’re running ad campaigns on any platform, the goal is to reduce spending while driving more engagement. 

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TikTok is the place to be when it comes to running ads on social media. They have a user base that’s 1-billion strong, which includes 17.9% of all internet users over age 18.

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Whatever you ultimately spend should be recovered through conversions. These conversions can be a direct result of the ad campaign, or they may come over time as you nurture leads your ads generate.

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In this post, we’ll cover everything you need to know about maximizing ROI with TikTok advertising as an e-commerce business. 

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Setting Up a TikTok Advertising Campaign

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Your ad campaign starts by signing up for TikTok Ad Manager. Head over to the TikTok Ads sign-up page to get started. You can create a new account, or sign up with your existing TikTok account. 

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Once you’ve finished the registration process, you can start a new ad campaign by clicking on the “Campaigns” tab. Select “Create,” and choose an objective.

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1. Define Your Objective

Campaign objectives help structure your ads better. They automatically optimize your ads to perform based on your desired outcome. If your goal is to bring more people to your site, then you’d select a traffic objective.

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Each objective is designed to inspire people to perform an action. Choosing the right objective will ensure your ad campaign is clearly aligned with your business goals. Read more about how to choose a campaign objective from the TikTok Business Help Center.

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2. Name Your Campaign 

This straightforward process helps you clearly identify your campaign by name. When running multiple campaigns, you’ll want simple names that distinguish them from one another. You can also use these names for easy reference as you review historical campaign data. 

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3. Set Your Budget

Ads on TikTok can run on a lifetime or daily budget. There is a minimum $500 budget per campaign. You can decide to let the platform distribute your ad spend over the course of your campaign, or set a cap for each day.

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4. Name and Place Ad Groups

Ad groups allow you to easily sort ads based on their placement, target audience, and more. At this stage of the setup process, you’ll name your first ad group, then choose how the ads will run on TikTok.

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• In-feed ads blend into the user’s viewing experience under their “For You” tab
• News feed apps display in partner apps, like Buzzvideo and NewsRepublic
• Pangle placement allow you to run on third-party apps
• Automatic placement lets TikTok decide the best place to run your ads

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5. Opt in or Out of Automated Creative Optimization

TikTok has a helpful feature called Automated Creative Optimization that essentially makes variations of your ads for you. They’ll combine your images, text, and videos to make different ads, show them to your audience, and let you know which ones perform best. 

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6. Define Your Target Audience

Now, you’ll need to provide TikTok with information on the type of people you want to reach. Enter details like their age range, gender, location, interests, and behaviors to refine your ad strategy. 

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This is arguably the most important part of any campaign, so make sure you’ve heavily researched your market and audience beforehand.

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7. Create an Ad Group Budget

The ad group budget is linked specifically to the ad creative within each group. It falls underneath your overall ad budget. This feature allows you to decide how much money you’ll spend on each ad group, making it a great tool for A/B testing.

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8. Select a Bidding Strategy

Some campaign objectives automatically handle the bidding strategy. If yours hasn’t, then you’ll have to choose between reach, clicks, or conversion before setting a strategy. You have three options: a bid cap at the max amount per click, a cost cap, or the lowest cost for a bid. 

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9. Select a Delivery Model

You can choose to run your TikTok ads through a standard or accelerated delivery model. Standard campaigns evenly distribute your budget across the days you’ve defined whereas an accelerated model spends your money as fast as possible in hopes of maximizing performance for the least amount of time. 

We advise choosing the standard campaign in most cases. 

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10. Create Your Ads, and Launch

Finally, you can start uploading creative assets to the platform. Each ad group can have up to 20 ads. It can be an image, video, or Spark ad. You don’t have to worry about uploading a finished product, either. The TikTok Video Editor allows you to upload footage from your computer, then edit it using TikTok-copyrighted music, fonts, and more. The platform reveals that using their editor can lower cost per action by up to 46%!

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Optimizing Your TikTok Advertising Campaign

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What makes a good TikTok ad? According to TikTok’s Creative Best Practices, shorter videos perform better. It’s best to keep your video between 21 and 34 seconds, and introduce the main message within the first 5 seconds. 

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Be Upfront

If your video doesn’t immediately captivate your viewers, then they’ll never stick around long enough to see the best part. 

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Do yourself a favor, and get in the habit of making ads with impactful openings. It’s okay to reveal your message from the get-go. In fact, that’s what people on the app want. 

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Keep It Real

When it comes to your images and videos, make sure they’re high-quality without being overly edited or staged. TikTok’s audience prefers natural videos that show products “in the real world.”

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Challenges, trending sounds and music, and hashtags are all a great way to make your ads feel relevant with your audience. Make sure that you continually use demographics, interests, and behaviors to shape your ad design. 

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Think about what someone in your audience would want to watch, not what you want to show them as a business.

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Take Advantage of A/B Testing

Running variations of ads can help you figure out more about what your target audience likes. Things like color, footage, and music can all be tested. The easiest way to do this is create two ad groups, then measure their performance based on your criteria.

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When A/B testing, make sure that you have specific details you’re measuring. Avoid making your ads too different, otherwise it won’t be possible to pin down which factors influenced engagement the most.

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Measuring and Analyzing Your TikTok Advertising Results

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There are plenty of metrics you can use to track campaign performance. These all help you learn more about viewers’ behavior, as well as how your ads are performing in relation to your budget. 

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In the Ad Manager, you’ll find an overview of your campaign that includes:

• Clicks
• Conversions
• Cost per 1,000 views
• Cost per acquisition (CPA)
• Cost per click (CPC)
• Cost per thousand impressions (CPM)
• Clickthrough rate (CTR)
• Frequency of views
• Impressions
• Reach
• Total cost 

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These key metrics make it possible for you to weigh performance against budget, and determine which ads are worth their cost. It’s also helpful to use this data as you plan future campaigns, so you can hopefully improve clicks and conversions while lowering costs. 

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A/B testing once again comes in handy here. By comparing the metrics on two similar yet distinct ads, you can assess which features ultimately give your ads a competitive edge. Then, you can use these elements in the future to make ads that perform even better. 

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Conclusion

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Now that you know how to set up TikTok ads, it’s time to get out there and show the world your brand! Remember, being real and having fun are the best ways to make an impact on TikTok. 

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For e-commerce platforms, TikTok is a great way to reach new audiences and boost their ROI. Integrated metrics allow you to get all the important details in one place, so you can continually make improvements that maximize your ad spend.

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