Known for its snappy, bite-sized videos that appeal to young audiences, Tiktok has become a hot spot for brands looking to reach this lucrative demographic. However, unlike influencer marketing, Tiktok’s formal ad program comes at a premium price. The platform has a relatively new advertising program that offers a variety of different advertising options, including sponsored hashtag challenges, carousel ads and branded effects. But what determines tiktok ad prices?

Ad formats and placements: The type of ad format, its placement within the app, and your bidding strategy will affect pricing. For example, in-feed ads will typically cost less than sponsored hashtag challenges and branded effects.

Targeting options: This defines who sees your ad and includes demographics, interests, and location. You can also use ad groups to create multiple targeted audiences to reach your ad campaign goals more efficiently.

Analyzing TikTok Ad Prices: Budgeting Tips

CTR and conversion rates: These metrics measure how many people click on your ad and complete your desired action, such as making a purchase or filling out a form. They are critical for measuring your ad’s performance and ROI.

Costs: Tiktok’s auction-based ad model starts at $10 per thousand impressions (CPM), but this can decrease with a well-planned campaign. You can also set daily budgets at the ad group and campaign level. This is especially helpful if you are a newbie to Tiktok ads, as it helps you keep your spending under control. You can even mute specific advertisers from reaching you for 28 days in your advertiser settings if you want to limit unwanted messages from a specific brand.