Will TikTok Become Too Big to Ban?

On Polymarket, there’s an active bet: TikTok banned in the US before May 2025?

The ‘Yes’ odds declined from 28% to 7% when Donald Trump won the 2024 presidential election. Trump, who once signed an executive order in 2020 to ban the platform in the U.S., now wants to ‘save TikTok.’

We could dig into potential reasons for Trump’s shift, like his donor Jeffrey Yass’ 15% ownership of ByteDance, or the potential boost a U.S. TikTok ban would give to competitors like Meta, but let’s be real. The odds of an enforced ban were low regardless of who sits in The White House. One big reason is the growth of TikTok Shop.

TikTok’s e-commerce platform has been a force in Southeast Asia. Douyin, the Chinese version of TikTok that ByteDance also owns, surpassed Alibaba’s Tmall e-commerce in clothing sales in 2023. The company expanded TikTok Shop to the U.S. in September 2023. The goal was to capture a portion of the 110 million U.S. consumers who shop on e-commerce sites since TikTok reaches over 170 million monthly active users in the U.S. alone. Its goal is to hit nearly $18 billion in gross merchandise value (GMV) by the end of the year.

Some of music’s biggest names, like Nicki Minaj, have gotten involved. The Pinkprint rapper will set up livestreams to share gifts she finds on TikTok Shop and will promote her own Pink Friday Nails collection.

Nicki’s a great example of the competing incentives we discussed in our TikTok’s Future in Music episode. She’s the most-followed rapper on Instagram and one of the most-followed on TikTok. Her rates for brand deals and endorsements are through the roof, and for good reason. Remember when Nicki’s Instagram post with pink Crocs led to a 4900% spike in sales for the product, which crashed the company’s website? ‘Breaking the internet’ is arguably the highest level of influencer power.

Nicki’s music is still popular. “Starships” has over 1 billion Spotify streams. The Gag City World Tour was a hit. But her ability to drive brand deals is her strongest bag. Her brand partners may brace themselves for her crash-outs on social media, but it comes with the territory.

So when Nicki’s record label pulled her music off of TikTok earlier this year, she may not have been thrilled about it. Sure, she would welcome the increased royalty rates and AI protective measures, but not at the expense of missing the platform’s promotional elements, especially in the middle of her tour!

TikTok’s leverage in sales may also help its standing with the U.S. If the platform can show through its GMV that it’s a meaningful contributor to the U.S. economy, then it will become Too Big To Ban. For better or worse, that’s the rationale that Meta, Google, Amazon, and other platforms use when the government comes after Big Tech. A lot of small businesses would cease to exist without the ability to advertise on Instagram and other platforms. That’s the case that TikTok, understandably, also wants to make.

If TikTok Shop wants to truly stand out from other influencer-driven ecommerce offerings though, it can stand out with quality. Products from Temu, Mercari, and Wish have gotten a bad rap for being all flash but no substance. They’re often affordable, look great in photos, are good for one or two uses, but don’t last.

The growth of TikTok Shop, and the ripple effects of a U.S. TikTok ban, will likely see the entertainment platform continue as a ByteDance-owned company long after the January 2025 deadline from Congress (and the May 2025 bet on Polymarket). But the key to maintaining its position will come from return users and customers. That includes startups, small business owners, major corporations, and artists like Nicki Minaj.

Chartmetric Stat of the Week - yes, and?

On TikTok, Ariana Grande gained more followers after UMG put its music back on TikTok than she did after the release of her latest album, Eternal Sunshine. Grande gained over 500,000 followers in the month after May 1, which is the date that TikTok and UMG announced their deal. Meanwhile, from March 4 to April 29, Grande gained just 300,000 followers despite her album being released on March 8.

Part of that may be due to the inability to promote her music on TikTok. Part of that may also be Grande’s renewed interest in acting over music—especially given the promotion for her role in Wicked!