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Marketers warily continue to spend on TikTok but some are building escape clauses into their contracts because of the political uncertainty

Marketers warily continue to spend on TikTok but some are building escape clauses into their contracts because of the political uncertainty

Kevin Mayer TikTok former Disney

It’s been a confusing few days for marketers using TikTok.

On Friday, President Trump told reporters that he planned to ban the short-form video app outright. By Sunday, the ban was off, with Microsoft announcing that it was in talks to acquire the company’s US operations by September 15.

With so much news unfolding around the social-media app, marketers running campaigns there told Business Insider that it’s been business as usual — even as panicked creators have begun directing their fans to follow them on other social platforms like Instagram and YouTube.

But some are exercising caution when it comes to planning future campaigns on the app.

“We still have a green light on numerous proposals that are for TikTok for the next few months and even into Q4,” said Mae Karwowski, founder and CEO of the influencer-marketing firm Obviously. “We’re just having really candid conversations with our clients and writing into the contract that they have the ability to move this to a different platform if they so choose.”

Max Levine, cofounder at Amp Studios, a talent incubator and content studio that works with 11 TikTok stars, said that the lack of clarity around the app’s future could cause companies to be more conservative about running campaigns on the platform.

“I think the news is still relatively early and there’s a lot of wait and see,” Lyle Stevens, CEO of the influencer-marketing platform Mavrck, said. “We still have several campaigns in flight on TikTok for brands that haven’t been disrupted as a result of this yet.”

Stevens said that marketers are unlikely to cut budgets for TikTok in the near term, but the app could take a hit later this year if there’s no ownership resolution by the time of the US presidential election shortly before the holiday season when marketers beef up their advertising spend.

Some agencies say that it’s unclear why Microsoft wants TikTok

Microsoft has a mixed history with selling advertising.

The tech giant sells search ads that it claims to reach 127 million desktop users, 46.7 million of whom are not reachable through Google. Microsoft has targeted some recent ad products at retailers that rival Amazon, and Microsoft-owned LinkedIn also runs an advertising business.

But Microsoft also abandoned most of its advertising business five years ago when it inked a deal with AOL to sell Microsoft ads, including moving over 1,200 Microsoft employees to new roles at AOL.

Brendan Gahan, partner and chief social officer at ad agency Mekanism, said Microsoft would give TikTok a credibility boost with marketers while helping Microsoft compete with Facebook and Google.

“With Microsoft onboard, TikTok will have a lot of legitimacy among advertisers,” he said. “Microsoft is a trusted American company. Anyone that was on the fence given the conversation around China, data, and privacy will likely have their concerns squelched.”

It’s unclear where TikTok would fit in with Microsoft’s ad products, though, said Brian Wieser, global president of business intelligence at GroupM.

He added that TikTok is open to more risk than other platforms to advertisers’ concerns and that the ownership uncertainty may deter advertisers from spending there.

“It’s hard to imagine it not having a negative impact on the business,” he said. “If you’re a marketer, you have no idea if they’re going to be around to operate in six weeks’ time.”

For more coverage on TikTok and its competitors, read these other recent stories on Business Insider:

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