By Megan Sayles
AFRO Business Writer
msayles@afro.com
A recent report from Oxford Economics discovered that U.S. small- and midsize-businesses (SMBs) generated $14.7 billion in revenue through advertising on TikTok in 2023. The enterprises spanned industries, including food and beverage, health and wellness, automotive, business services, tourism and real estate.
In particular, Black-owned businesses have created more than 1.5 million videos, amassing more than 3.3 billion views. Eighty-three percent of them say they’ve experienced sales increases after promoting on TikTok, according to the report.
“TikTok provides a new path to business growth for SMBs,” wrote Oxford Economics. “These organizations use TikTok’s wide reach and high engagement to promote their brand, create awareness of products and services and track the success of business initiatives in the app.”
Fifty-seven percent of Black businesses said TikTok is critical to their existence. Not only has the platform boosted their sales, it’s helped them to scale. Fifty-nine percent of Black SMBs have used the app to hire a new employee, and 76 percent have been able to secure a new investor with the help of the platform.
In April, President Joe Biden signed a bill into law that made way for a potential ban of TikTok. U.S. lawmakers have argued that the app poses a national security risk as it’s owned by China-based company, ByteDance. The technology company has a year to sell its stake in the app before it’s shut down.
Some Black SMBs worry a ban could harm their businesses.
“This potential ban is concerning for minority companies like myself because TikTok is more than just a social media platform. It’s a lifeline,” said Felicia Jackson, founder of CPRWrap. “It saved the life of my business, and because other people were able to see it, it saved the lives of people out there in the world.”
Jackson is a mother of three and former healthcare professional from Chattanooga, Tenn. In 2002, during a family outing, her 2-year-old son began choking. Although she was CPR-certified, Jackson froze out of sheer panic.
Her husband thankfully stepped in to save their child, but Jackson couldn’t shake the fact that she was unable to take action. This inspired her to create CPRWrap, a portable first aid tool for resuscitation.
The kit provides a template with simple CPR instructions that can be placed over a person undergoing a cardiac emergency. The product hit the market in 2018.
“When I first saw TikTok, I didn’t think promoting my business was something that was feasible because my daughter was on it a lot and she used it for dancing,” said Jackson. “I thought it was entertainment only and that my business would not fit on the platform at all.”
It was a disheartening conversation with a mentor that finally pushed Jackson to take to the app. The mentor told Jackson she should make a White person the face of her company, implying that would be the only avenue for growth.
She posted about the experience in February 2022 and went viral, garnering more than 754,000 views and 137,000 likes. TikTok users flooded the comment section with questions about Jackson’s invention, and she posted another video introducing the life-saving tool.
Nearly 1.4 million people saw the clip.
“We made almost $600,000 dollars from that one video, and I was able to keep my doors open,” said Jackson. “I was able to hire, pay myself and buy inventory.”
Jackson’s growth on TikTok has also spurred more followers on her other social media pages. For her, the platform was the key to overcoming an obstacle that many minority businesses face, a lack of visibility.
“Could a ban jeopardize my livelihood? Yes, there’s a possibility it could,” said Jackson. “It’s disheartening to see.”
Stormi Steele, CEO and founder of Canvas Beauty, said while she’s been thinking about the potential ban, she hasn’t allowed it to consume her.
“When the time comes, I hope that people and brands like mine on TikTok can be a voice for not seeing it go away because to me it does more good than bad as of right now,” said Steele.
The small-town Mississpi native created her first product, the Canvas Hair Blossom Serum, in 2015 while working as a hairstylist. Soon after, she decided to quit her day job and start selling the hair product online.
In her first year, Steele generated $1 million in sales. The brand continued to rapidly grow, hitting the $20-million mark in 2020.
But, Steele almost went bankrupt.
“I grew so fast, and I just didn’t know a lot or how to properly vet people who wouldn’t take advantage of me,” said Steele. “In 2023, we launched a new product called Body Glaze, and it did moderately decent numbers on the website, considering we had been in business before. But, when we got TikTok, we saw this tremendous boom.”
She posted her first viral video last August. It follows Steele as she prepares Body Glaze orders. In the same month, Canvas Beauty joined TikTok Shop, which enables brands to sell directly through content on the app.
By December, Steele secured a new 30,000 square-foot warehouse for the business, which she moved into in March. She’s also been able to grow her staff from 10 to 60 employees. The brand captured about $5 million in sales in March alone—the vast majority of which came from TikTok.
Though Steele isn’t allowing the potential TikTok ban to intimidate her, she is conceiving courses of actions if the app is prohibited.
“As of right now, I’m focused on the day-to-day of it all and trying not to make myself afraid of what the future may be,” said Steele. “I’m also intentionally putting measures in place if the worst was to happen.”
Megan Sayles is a Report for America corps member.
