Tiktok, How does Tiktok makes money: A case of viral application and its revenue model.

                                               A Journey from Musical.ly to Tiktok


Before Tiktok, formerly known as Musical.ly which was invented by Alex Zhu and Luyu Yang. They got an investment for 2.4 million dollars to create a short educational application for students in the field of science, maths and other basic subjects. But this application was a loss because the target customer couldn’t understand the concept in such a limited amount of time. One day Alex was traveling to another city through a bus and he had an epiphany by looking at the teenagers taking selfies and singing songs on various different apps. He thought why not creates an application which is an amalgam of Snapchat, Facebook and Dubsmash. From this point, Musical.ly came to existence.

Musical.ly got its impressive audience because of the unique concept (People lip singing their favorite song or dialogue from a movie) and keep on growing audience kept the investors waiting to buy this application. Finally ByteDance a Chinese internet technological company acquire Musical.ly for $ 1 Billion and changed its name to Tiktok.

                                                         Current Stats of Tiktok


The count for Tiktok is 80 million users only in the USA and an overall count for this application is 500 million worldwide. It is the 6th most download application all over the world. ByteDance, a company which owns Tiktok has a total net worth of $75 billion.


                                                               What is Tiktok?


Ticktok is defined as a platform for short movie acting and entertainment. Zhang Yiming CEO of Tiktok, a 35-year-old entrepreneur whose background includes the creation of a real estate search engine. The actual target audience is below 21 years and astoundingly 70% are female and 30 % are men who use this application frequently. More than 12 million videos are uploaded each day, they might become a competitor for YouTube.
  
                                       
                                   How does a user can earn money from Tiktok?

So how does Tiktok work? The first part is you follow the hash-tags which are trending all over the world. Make a video accordingly and get people attention. Once you have a good amount of followers to your profile you can go live. The real revenue model lies when you go Live and have a massive following.
When you go live, follower buys the emojis (Gifts) and send it to you. They buy these emojis through coins which are bought by money. Once they send it to you, you give them a shout-out and they feel delighted. Once you have collected a certain threshold amount of emojis, you can cash these emojis into money. This concept is known as in-application purchases.

For Tiktok, they earn their revenue by earning through coins. Some amount of the money goes to the application store (I-tunes or android play store) and the remaining goes to the Tiktok.

The second revenue stream of Tiktok is campaigning with different movies. A simple example of the movie “Zero” by Shahrukh Khan. Where who so ever deliver the best dialogue of this movie will get a chance to meet the celebrities and make a mark in the social media community.

The last revenue model which is in the test stage is the Ads model. Since they have a huge database of the customers, they can earn a substantial amount of money through these CPM ads.

For the payment withdrawal method, your minimum threshold is $100 and you can take out $1000 in a day.