Brief:

• TikTok, the social video app that was ranked No. 4 by worldwide downloads last quarter, is testing a new format that resembles Facebook's Instagram, according to a TechCrunch report on screenshots of the new features posted by technology blogger and app researcher Jane Manchun Wong to her Twitter account.
• The test features include a change to its "For You" page that relies on an algorithm to offer personalized suggestions on what to watch. TikTok also is piloting a Discover tab that would replace the current Search tab that lets users find videos based on keywords. A Suggested Users feature also appears to highlight top creators.​
• TikTok is testing popularity metrics such as "like" counts and number of video downloads, an opposite strategy from Instagram's move to disable "likes" in an attempt to reduce some of the the social pressures that people feel on social media. TikTok is piloting a "Send to" section that would let people send videos through Facebook's WhatsApp messaging app, and a feature to link their accounts to Google and Facebook.

Insight:

Reports of TikTok's test features suggest that parent company ByteDance is working to adapt the most popular parts of other social media apps like Instagram and Snapchat into its platform. TikTok has surged in popularity with features that urge creative collaboration among its users, and high-end artificial intelligence (AI) that identifies fun and quirky videos that people enjoy watching. Its in-app tools simplify video production, including viral content like "challenges" for other users to try. TikTok has been downloaded 1.2 billion times worldwide and 104 million times in the U.S., per research firm Sensor Tower.

The biggest risk for TikTok is that its format changes may alienate some users, making beta tests a critical part of any redesign. Snap's revamping of Snapchat last year was blamed for a temporary drop in its user base. The image-messaging app also has faced stronger competition from Instagram, which has copied Snapchat's popular features like Stories that string together several images and videos into a single post. However, other social media companies like Facebook and Twitter also have undergone format changes that haven't caused a significant loss of users. Facebook this year redesigned its app to focus on groups, while Twitter reworked its website to simplify navigation of tweets.

Another key challenge for TikTok will be monetizing an audience that mostly consists of teenagers using the free app. While teens may influence the purchase decisions of their parents, they also have notoriously fickle tastes. Musical.ly, which ByteDance acquired in 2017 for a reported $800 million to $1 billion and last year merged with TikTok, also was a huge hit among U.S. teens but gained little advertiser traction. Brands are still cautious about the safety of TikTok amid accusations the app is violating children's privacy and showing "objectionable" content. TikTok now restricts downloads for kids under 13 as part of a settlement with the U.S. Federal Trade Commission.

Brands like Chipotle Mexican Grill, GrubHub, Guess, Sony Pictures and Uniqlo have developed campaigns on TikTok as the app moves into the marketing world. The company last month made its first appearance at the Cannes Lions International Festival of Creativity to expand its global marketing efforts beyond the handful of early sponsors that have tested it out.

TikTok also ramped up hiring to gain greater ad-sales expertise in more regions. Key hires this year include Facebook's former VP of Global Partnerships Blake Chandlee as VP of business strategy in the Americas and Europe, the Middle East and Asia, and Vanessa Pappas, YouTube's former global head of creative insights, as TikTok's first U.S. general manager.