How to run TikTok ads in 2023: A 5-step guide

TikTok started as the choice social media app for the younger set, first with Gen Z and now with up-and-coming Gen Alpha.¹ Think the social media platform is just for kids? Think again. 

The app isn’t just expected to balloon to 955.3 million active users by 2025.¹ At the time of this writing, more than 65% of TikTok users are between the ages of 18 and 34—a much larger demographic than the app’s much-discussed 13 to 17 segment.² 

For brands, that’s a lot of potential to reel in audiences with real buying power with TikTok ads. Another significant reason to create a TikTok marketing strategy and take advantage of its advertising power for brand awareness and conversions. 

But how exactly can brands run paid ads so they cause a ripple effect?

This journey inside the social media app can help brands find out how to use TikTok and create ads that drive visibility, traffic and conversions.

Step 1: Create a business account

Before doing anything else, businesses will want to set up a TikTok business account. These are different from personal portals because they enable brands to:³

• Get to know their audience
• Track data points on ad engagement and performance
• Include direct links to products and storefronts
• Research what TikTok trends are active in their area (and how to jump in on them)

A business account also gives brands access to TikTok’s support services to troubleshoot issues with ads. For reliable technical support, analytics prowess and creative guidance, it’s beneficial to partner with a digital marketing agency that knows its way around TikTok.

Step 2: Choose a campaign objective

Once they’ve set up a business account on the social media platform, any ad a business runs on TikTok will start with these 3 steps:

1. Logging into TikTok Ads Manager
2. Clicking the Campaign button
3. Clicking Create

That’s the practical order of operations. The more complicated task is choosing the TikTok ad campaign’s objective—that core goal that’ll align a business’ goals with any ad it creates. 

Choosing an objective

TikTok identifies three objectives that brands can choose for every ad they create, and each of them affects how an ad will circulate on the platform. These are:⁴

• Awareness – This objective shows your ad to the maximum amount of people—making it optimal for brands looking to increase brand awareness using the TikTok platform. Businesses should choose this objective when they want their ads to introduce more people to their product or brand and attain the most leads.
• Conversion – For leads that are further along in their customer journey, brands may want to consider choosing conversion as their objective. Conversion asks people to take a specific action, like adding items to their carts, signing up for a newsletter or making a purchase.
• Consideration – This objective aims to entice prospective customers by giving them fresh information about a business. TikTok organizes consideration into four sub-goals:
  • Drive traffic
  • Increase app installs
  • Improve video views
  • Create lead generation

Each of these options could be advantageous for an ad, depending on which KPIs or 

broader marketing goals a business is looking to drive with their TikTok campaign.

In other words: If a business is looking to garner more interest, there’s an objective for that. And if they’re trying to double down on their conversion rate, with the right objective, TikTok ads make it possible.

Step 3: Name the campaign and set a budget

Once a brand has chosen their objective, it’s time to name the ad campaign. Two things to note here:

• The campaign encompasses all of the ad groups and advertisements within this campaign.
• The name won’t appear on each ad from the user side. Rather, it will help the brand’s team keep track of how each campaign progresses.

Next, businesses can determine how much money they want to allocate for this campaign. Selecting Campaign budget optimization gives TikTok permission to use funds towards the ads it believes have a higher chance of making a conversion. 

Many brands find they get more bang for their buck using this feature, since it typically lowers the cost per lead while achieving measurable results.

Step 4: Create an ad group

An ad group is a section of the overall campaign that contains similar characteristics.⁵ For example, a brand can group their ads by:

• Theme
• Product lines
• Service types
• Target audience

After naming the first ad group, brands can target this collection of ads by taking the following 5 sub-steps.

#1 Selecting ad placements

Creating an ad group starts with ad placement. Ad placements determine where ads will be seen by users. This means a brand must decide if they’d rather have their ads viewed on the TikTok app or on some of TikTok’s other extensions like BuzzVideo, TopBuzz or Babe.

Businesses who aren’t sure where their target audience hangs out can always select Automatic placement. With this option, the TikTok algorithm does the guesswork on the brand’s behalf, showing their ads to relevant users on various platforms.

However: If a business knows exactly where to find their target audience, they can choose Select placement instead. This allows brands to handpick the specific placements for their ad group.

#2 Choosing creative types

When choosing a creative type, brands will have the option to select Automated Creative Optimization. 

This option lets TikTok automatically combine some of a brand’s current creatives to include multiple ads in a campaign.⁶ The app will then show users content that’s currently performing the best so that the brand receives more high-quality traffic.

For businesses just starting out with TikTok ads, this can be immensely helpful—particularly for those coming up with a TikTok content marketing strategy from scratch. Once a business begins tracking its progress and monitoring engagement, it can begin tailoring advertisements without TikTok’s creative input (if it so chooses).

#3 Picking a target audience

An important aspect of any TikTok marketing strategy is understanding who the business’ target audience and potential followers are. If a brand’s target audience is 35 and up, there’s no point sending their ads out to 16-year-olds busy chasing the latest skincare ice bath craze.

Instead, businesses have the chance to narrow down their scope, target their brand’s audience and learn even more about what makes them Tik. Businesses can choose their TikTok demographics based on markers like:

• Age
• Gender
• Location
• Interests
• Income level

#4 Deciding on a budget and schedule

TikTok allows brands to choose between two different budget types for their ads:

• Daily budget – This is the total amount the business is willing to spend on this ad group each day. The minimum requirement for a daily budget is $20.
• Lifetime budget – This refers to the maximum the business will spend on the ad group throughout the campaign. As of now, there’s still a $20 per day minimum.

It’s important to note that budgets a brand approves will be the maximum amount it will spend. That’s not to say each day will completely max out at the upper limit—some days will use more money than others.

#5 Finalizing bidding and optimization

Bidding on TikTok is like putting in an offer at an auction: the goal is to have a bid that’s higher than competitors’ bids. The person with the highest bid has the best chance of having their ads seen by their target audience.

There are multiple types of bidding brands can partake in depending on their marketing objectives:⁸

• Cost Per 1000 Impressions (CPM) – The amount the business is willing to pay every time their ad is seen by 1000 users.
• Optimized Cost Per 1000 Impressions (oCPM) – oCPM is similar to CPM, but it’s even more laser-focused on the target audience. oCPM involves displaying an ad 1000 times for users who are more likely to complete a conversion.
• Cost Per 1000 Views (CPV) – The total a business will pay for 1000 people to watch at least 6 seconds of their ads.
• Cost per click (CPC) – How much the brand will spend every time someone clicks on their ad.

Step 5: Create an ad

The time has come: The last step is for brands to publish their creative and launch their TikTok ad.

After reaching the ad window in the app, here’s how businesses can go live:⁹

1. Name the ad – This helps brands tell their ads apart within the ad group.
2. Select a format – TikTok only accepts video format, whereas Buzzvideo allows videos and picture ads.
3. Insert the media – Media can be added from a computer, from previous ads or from a new video.
4. Enter the remaining elements – Next, brands should include the ad’s display name, an explanation of what they’re promoting, a call to action, a profile image and a URL of the website where they’d like to drive traffic.

Once complete, brands can give their ad a Preview to assess their handiwork. If they give it a gold standard approval, our fingers are crossed TikTokers will, too.

Take your TikTok strategy up a notch with Power Digital

TikTok is known for being one of the smartest apps in the tech sphere today—but to master it, you’ll need a marketing strategy, and a TikTok agency, that’s even sharper.

Power Digital is a growth marketing firm that’s been helping change-making clients make their mark through each new generation of media. We make gains for our clients on their terms, with a knife-edge analytics platform that identifies opportunities for brand expansion across the media ecosystem.

And when we see an opportunity, we seize it. To see what your custom marketing strategy could look like on fresh and established channels, reach out to Power Digital today.

Sources:

1. Statista. Number of TikTok users worldwide from 2020 to 2025. https://www.statista.com/statistics/1327116/number-of-global-tiktok-users/
2. Oberlo. TIKTOK AGE DEMOGRAPHICS. https://www.oberlo.com/statistics/tiktok-age-demographics
3. TikTok. TikTok Business Account. https://www.tiktok.com/business/en-US/solutions/business-account
4. TikTok. Setting Up Your First Tik Tok Campaign. https://www.tiktok.com/business/en/blog/setting-up-your-first-tiktok-campaign
5. Google. Ad Group: Definition. https://support.google.com/google-ads/answer/6298?hl=en
6. TikTok. Automated Creative Optimization. https://ads.tiktok.com/help/article?aid=6670043695674294277
7. TikTok. About Budget. https://ads.tiktok.com/help/article?aid=6712393859751477254
8. Ecomdy Media. How to Find the Right TikTok Ad Bidding.  https://blog.ecomdymedia.com/how-to-find-the-right-tiktok-ad-bidding-7e37a2b7614f
9. TikTok. Set Up an Ad. https://ads.tiktok.com/help/article?aid=9525