TikTok's Innovation and the Future of Short Videos

The format known as "short videos," typically lasting just tens of seconds, has gained widespread user acceptance. Diverse platforms like TikTok, YouTube Shorts, Instagram Reels, and LINE VOOM are expanding their services and fiercely competing in this space.

In this series, Akira Amano of Dentsu Inc. Media Innovation Lab will share insights on social media marketing centered around short videos, drawing from his recent publications and professional experience.

The first installment reexamines why short videos are so popular now and explores the reasons behind the widespread acceptance of services like TikTok.

Mr. Amano specializes in R&D and consulting on social media marketing applications and youth trends. He currently serves as Project Leader for the cross-functional internal organization "TikTok Solution Lab." In 2022, he published "Business for the New Generation Emerges from Smartphones: Social Media Marketing in the Short Video Era" (Sekai Bunka Publishing) (release details here ).

386 pages, Price: ¥2,200 (tax included), ISBN: 978-4418206032

 

TikTok's average viewing time and usage frequency are increasing, and it is growing as an advertising and paid media platform.

As of September 2023, TikTok's MAU (Monthly Active Users) in Japan was approximately 27 million (according to AppAnnie). Approximately 30% of users are aged 18-24, while about 70% are aged 25 and above, with the average user age being mid-30s. The average viewing time per user is about 70 minutes, with users accessing the app around 10 times per day (TikTok for Business data). While each video is short, the overall session duration is very long.

The app version has surpassed 3.5 billion downloads globally, with MAU exceeding 1 billion users. In the US, TikTok surpassed YouTube in usage time in 2021 and was recognized as the world's most visited domain that same year, overtaking Google.

Projections indicate TikTok will surpass YouTube's advertising revenue by 2024 (Insider Intelligence survey). Additionally, TikTok's in-app purchases (IAP) already exceed the combined total of major social media platforms (Apptopia report).

These figures clearly show that a massive number of users spend significant time on TikTok daily. Consequently, the market for advertising and in-app purchases is also experiencing steady growth.

※1 MAU (Monthly Active Users): Number of active users per month.
※2 Session: A series of communications from the start to the end of an access.

 

Three Key Reasons Users Get Hooked on TikTok

Why has TikTok become so widely accepted? Based on the diagram below, we explain three outstanding points that were unattainable with conventional services.

Adapted from Chapter 8 of "New Generation Business Emerges from Smartphones: SNS Marketing in the Short Video Era" (Sekai Bunka Publishing)

(1) Exceptional User Experience
Its smartphone-optimized design provides an excellent UX, allowing audiences to view and select short videos without stress and for extended periods. For creators, the value lies in the refined video creation tools and the broad scope for expression.

(2) The appeal of UGC (User-Generated Content)
(1) creates a platform where many creators produce excellent videos. Additionally, the scope for creativity is broad, including "clippage videos"—edited versions of influencers' original content.

(3) Superior Algorithm
Content matching for users is highly accurate. There's a mechanism ensuring interesting uploaded videos circulate effectively.

It should be noted that the short-form video format itself is not particularly new. Services like Vine (an American short-form video sharing service) were already popular in the early 2010s. Key differences between that era and the current short-form video boom include "smartphone penetration rates," "improved network environments," and, crucially, "the evolution of the service itself."

For TikTok, the recommendation algorithm plays a particularly significant role. Its discovery-driven nature—exposing users to unexpectedly interesting short videos—is why we trust the "For You" feed and find motivation to keep watching TikTok daily.

Crucial here is the concept of "time performance" (abbreviated as "TPA"), a buzzword that gained widespread attention in 2022. Derived from the idea of "cost performance" (meaning cost-effectiveness), it reflects our inevitable pursuit of TPA (time-effectiveness) because our disposable time is finite, while the volume of information circulating endlessly continues to grow.

Simply put, good TPA means "reaching the interesting or useful parts quickly."

The strength of short videos' TPA lies in their plots being crafted to minimize the time from introducing the theme (hook) to reaching the conclusion (punchline). Short video creators are acutely aware that even one second of boring footage risks viewers swiping away (leaving).

It's important not to misunderstand: for users, it's not just the pacing of the content itself (tens of seconds) that matters. Rather, they increasingly seek good pacing in the linear experience of "what content they encountered throughout that session (several minutes to tens of minutes)."

While these two aspects are often lumped together under the term "TAP," they differ fundamentally: the former concerns how content is crafted, while the latter depends on the precision of the algorithm.

So, what exactly is the mechanism behind TikTok's algorithm, as discussed so far? While details aren't publicly disclosed due to competitive advantage, it's fundamentally thought to judge video quality based on two metrics (similar to short-form video services in general).

The first metric is watch time and completion rate. Given TikTok's UI allows users to instantly swipe away uninteresting or boring videos, data on how long a video was watched or whether it was watched to completion becomes a crucial signal.

The second metric is user engagement. This refers to the volume of actions users take, such as likes, comments, saves, and shares.

While the exact weighting of each factor remains unclear due to frequent algorithmic tuning, it's widely understood that the system is built around the above principles. This makes sense given the algorithm's core goal: "to keep users engaged with the platform for longer periods."

We live in an era where algorithms assist our discovery. This represents a shift toward an information environment where "content discovers users." That said, it doesn't mean we'll stop actively seeking information and content. Indeed, TikTok is currently testing a feature in the US that displays Google links in its search results. While these approaches coexist as inseparable elements, the overall trend toward increasingly mechanized content distribution (recommendations) remains irreversible, especially as the total volume of information circulation continues to grow.

※3 UGC (User Generated Content): Content created and generated by general users.

 

Scenarios for the Future of Short Videos

The next article will explore how short videos have become indispensable in marketing and promotion, focusing on the keyword "TikTok sales." This article will briefly touch on future scenarios for short videos before concluding.

First, regarding changes in short video business models. TikTok is steadily expanding into the shopping domain while also diversifying its advertising solutions on the platform. For example, mechanisms are increasingly emerging where ad messages unfold richly based on user interactions (Interactive Add-on). Paid subscription features like "Series" and programs allowing creators to recommend products on TikTok and earn affiliate commissions have also launched in the US.

Furthermore, as part of TikTok's move to operate its own e-commerce site, it has launched "TikTok Shop," an in-app shopping platform already deployed in Asia and other regions, in the US as well. This resembles Amazon selling its private-label products on its platform. Considering Amazon's now significant presence as an advertising platform, the crossover area between e-commerce and advertising will likely become the main battleground for short-form video going forward.

Second, user trends across these services. Competition among social media platforms is fierce, making it difficult to predict which service will maintain dominance.

For example, the ADWEEK article "Beyond Virality: Understanding TikTok's New Growth Patterns" points out that the number of videos exceeding 10 million views on TikTok peaked at 9,259 per week in February 2022 but halved to around 4,600 by April 2023. However, the average number of views has remained largely unchanged, suggesting that explosive viral buzz is becoming less common.

Furthermore, Social Insider data concludes that the gap in user engagement rates for representative short-form video platforms—TikTok, Instagram Reels, and YouTube Shorts—has narrowed over the past two years.

Third, regarding the potential of short video services beyond social media. While this article has focused on "social media with short video capabilities," services utilizing short videos certainly extend beyond this.

One notable example is Loop Now Technologies, Inc., which provides solutions (like Firework) for embedding easily understandable short videos when browsing websites or e-commerce sites in a browser. For instance, clothing e-commerce sites traditionally relied on "product photos" and "text descriptions," but conveying the feel of wearing an item is far more effective with a few seconds of short video showing a model wearing and moving in the garment.

Thus, short videos must be viewed not merely as a boon for specific services, but as a larger movement.

As the volume of information we encounter via smartphones explodes and the relative scarcity of our attention grows ever greater, short videos will serve as the spark and the lead-off hitter, capturing attention and spreading topics and trends.

They are not merely superficial phenomena like "short and time-efficient." Rather, they represent a driving force that is fundamentally redesigning the format of content and how it is delivered within the modern information environment.