TikTok Shows The Importance Of Translating Brand Metrics Into Revenue Goals

BY ADAM GROSSMAN

TikTok’s emergence as one of the fastest growing global social media platforms has created a new opportunity for sports marketers to engage with their targeted audiences. Yet, the core challenge facing sports industry leaders is a familiar one for those that have evaluated making new technology investments.

TikTok is a “destination for short-form mobile videos” owned and made popular by the Chinese-based company ByteDance. Sports content, particularly highlights, has become one of the most viewed and engaging content types on the platform. This has led organizations including the NFL, NBA, and UFC to make TikTok an important part of their social media strategy to target younger fans.

The increasing number of organizations making TikTok investments has also caused marketers, such as Minor League Baseball (MiLB) social media coordinator Brad Friedman, to ask an old question about a new platform. As Friedman states, “Yes, flashy view numbers are great and there are benefits to that, but at the end of the day, we’re trying to monetize the baseball as a business. And we want to do what we can to possibly impact the bottom line.”

This challenge is one frequently encountered by Block Six Analytics’ (B6A) current and potential clients. More specifically, partnership investment is often largely dependent on driving lifts in top or bottom-line revenue goals. Yet, performance on social media platforms is determined by lifts in brand sentiment, engagement, and awareness using metrics such as “view numbers.” There appears to be a disconnect between the information needed to determine success and the data often provided by social media platforms.   

Addressing this challenge is one of the core benefits of B6A’s Social Sentiment Analysis Platform (SAP). SAP uses natural language processing (NLP) to “read” posts and determine the specific sentiment, engagement, and awareness scores. Our research analyzing hundreds of thousands of posts relating to companies across 27 industries found that lifts in the specific way B6A calculates these values has a strong and statistically significant correlation to lifts in top-line revenue growth.  

We can use “view numbers” as an example of how this works in practice. SAP translates views numbers into a brand awareness score with a specific dollar amount. If a company generates a higher number of views for content with partner sponsored or related posts than it receives from its own content then it would expect to a specific lift in top line revenue growth. That does not mean lifts are created equal. The impact of brand lifts on revenue goals very by industry (i.e. certain industries would generate more or less lift) but are quantifiable in a tangible way.

In addition, determining the correlation between brand metrics and revenue goals is not the only reason for making investments in social media platforms. Our Corporate Asset Valuation Model (CAV) specifically accounts for a return on objective (ROO) considerations in addition return on investment (ROI) goals when determining partnership value.

My co-authors and I delved into this challenge featured in the post five years ago in our book The Sports Strategist: Developing Leaders For A High-Performance Industry. More specifically, we believed that all sports strategists would function as a version of a chief technology officer (CTO) given the pace of technology development and the need to determine which platforms work best for their organizations. TikTok is the latest platform that requires examination in this context. Having tools, such as SAP, will be critical to making the right choices when it comes to strategic technology investments