Mon. Dec 9th, 2019

A TikTok star with 880,000 followers breaks down how she earns money and how much she makes

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A TikTok star with 880,000 followers breaks down how she earns money and how much she makes

Creators on TikTok are rising in fame from the massive reach the short-form video platform has, and now they are navigating the different ways to make money from their audiences. 

TikTok, the wildly popular app, sits besides other platforms like YouTube and Instagram on Apple’s 2019 list of the top five free iPhone apps of the year. The platform is owned by the Chinese internet company ByteDance and has become one of the hottest social platforms among Generation Z

21-year-old college student Salina (who preferred to keep her last name private) began uploading videos to TikTok about four months ago when she was on vacation with family in Japan.

“It grew very quickly, just building and building,” she told Business Insider, crediting her growth to TikTok’s homepage “for you” section, which recommends content to users. “I was getting about 10,000 followers a day.” 

Salina, who goes by “Salinakilla” online, now has 882,000 followers and expects to hit 1 million soon. She films makeup, dancing, lip syncing, and comedy videos for TikTok. She said she dedicates multiple hours throughout the day to TikTok and aims to upload about two to four videos each day, which she said helps with the likelihood of her content landing on the trending page. 

On YouTube, creators can earn money directly through ads placed by Google on their videos. But creators on TikTok, similar to Instagram, aren’t able to earn money that way.

Currently, the main four ways creators on TikTok can use the platform to generate revenue are through sponsorships, selling merchandise, live streaming, and affiliate marketing, according to Salina.

From her success on TikTok, Salina said she now earns enough revenue to treat her account like a part-time job. She’s also built a following on Instagram (38,000 followers) and plans to start a podcast and focus more time on building a YouTube channel and clothing line.

“In the long run, I don’t know if anyone wants to make four videos a day, every day for the rest of their lives,” she said, but added that TikTok can be a good tool for building an audience and driving success to other platforms or ventures.

Here’s a breakdown from Salina of the four main ways a TikTok creator can earn revenue:  

TikTok app iphone

1. Sponsorships 

A sponsorship on TikTok is usually in the form of a single timed video, tagged as “paid promotion.”

Brands sometimes ask for multiple videos, or a cross-platform integration, which includes an Instagram photo, or YouTube video mention, Salina said.

Creators can land sponsorships through TikTok’s monetization team (when the platform reaches out to creators), through a brand or agency, or from a record label. For an official TikTok campaign such as a “Hashtag Challenge,” TikTok will provide the sponsorship to the creator directly.

A record label — like Universal Music, Sony Music, or Warner Music — will often sponsor a TikTok creator when they are looking to increase the number of streams of a popular song, or make a song popular again.

Salina said a sponsorship on TikTok can range between $100 to thousands of dollars, depending on pricing factors like how many followers, fans, or likes the TikTok creator has.

Several Instagram influencers interviewed by Business Insider said creators often charge brands around $100 per 10,000 followers for a sponsored post on that platform, though brands increasingly pay attention to other metrics as well.

Salina said that in TikTok’s less established economic ecosystem, rates are more complicated, and sponsorships are generally less lucrative per follower.

“It’s not as black and white as people think,” she said. “It’s not like if you have 100,000 views you get this amount of money.”

She also said sometimes smaller music artists have reached out to her looking to pay around $200 for a video that uses their song, with the hope that the video will blow up.

David White, the head of influencer management at the digital talent management firm Whalar Stars, said generally the factors considered when pricing a TikTok campaign are the creator’s audience size, commercial licensing, brand exclusivity, and campaign scope. He said an audio integration for a record label is priced significantly less than an official brand sponsorship.

Salina said like Instagram, brands also send free products in exchange for promotion, like a shout-out or a product mention.

Salina

2. Merchandise 

One popular way influencers on Instagram and YouTube earn revenue is through selling branded merchandise, like a t-shirt or sweatshirt with their name or logo on it.

“Some people, even when they hit 10,000 followers, release merch,” Salina said of TikTok, and added that she’s planning to create a full clothing line instead of releasing merchandise. “I don’t want to throw my name on a shirt and call it a day.”

Salina

3. Live streaming

Live streaming on TikTok is when a creator films themselves in real time for their followers to watch.

During a live stream, followers can send a creator virtual “gifts” that they can purchase for various amounts of “coins” (coins can be bought by users in packs starting at 100 for $0.99).

The gift system includes the following levels: panda (5 coins), Italian hand (5 coins), love bang (25 coins), sun cream (50 coins), rainbow puke (100 coins), concert (500 coin), I’m very rich (1,000 coins), and drama queen (5,000 coins). 

Salina

“You’re connecting with your fans and it’s the fastest way to get money,” Salina said. “On average I can earn up to $20 to $50 on live streams. Sometimes I can get $100 or more within one live.”

“TikTok can take around half of the money I make,” she said. “I’m not entirely sure how much because there isn’t an exact equation to find the exchange rate to coins to points.”

That system is intentionally opaque. TikTok users use cash to buy “coins,” which they can then use to purchase virtual “gifts.” Once they give the “gifts” to the live streamer, those “gifts” are then converted into “diamonds.” Those “diamonds” are then converted into cash for the creator (like Salina), and are deposited into the creator’s PayPal account.

The rate of conversion from a “diamond” to cash is “determined by Bytedance from time to time in its absolute and sole discretion,” according to the company.

Salina

4. Affiliate marketing 

TikTok recently announced that the company is testing a new feature for some users that lets them link to online shops in their bio or directly from their posts. This will allow users to click off the platform and creators can then earn money from affiliate links.

Evan Asano, the CEO and founder of the influencer marketing platform MediaKix, told Business Insider that he thought this could make a huge difference in drawing in users and brands from platforms like Instagram. He said the option to link to an outside source could drive affiliate marketing, in which the creator earns a percentage of a sale from a third-party merchant.

Salina said she had used a couple of affiliate links through other platforms, but not through TikTok yet. She usually gets a 5% to 10% commission of every sale, she said.


For more on how to become a successful influencer, according to YouTube and Instagram stars, check out these Business Insider Prime posts:

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