Gazing Into the Foggy Future of Alcohol Advertising on TikTok
February 22, 2021
This is a story about alcohol advertising on TikTok. Or, to be more precise, its absence, because there are no alcohol ads on TikTok. Why? There’s alcohol on TikTok; there’s advertising on TikTok; the platform’s cryptic algorithm serves its enormous audience content with surgical accuracy. So wherefore art thou, slick booze brand collateral?
The short answer is that alcohol ads aren’t on TikTok because TikTok doesn’t want them there. Or it wants them, but it can’t have them, because a big chunk of its users are teenagers. Which, of course, is why major alcohol producers don’t want to be there. Or they do, but they can’t, because of the teenagers. Basically, they won’t, until they can, at which point, buddy, you’d better believe they will.
“It’s 100 percent going to happen,” predicts Molly McGlew, an independent social strategist who advises consulting clients on their approach to TikTok and other platforms. “I just think it’s going to happen a little slower than other platforms.”
But when? And how? These are interesting questions with tricky answers and millions of ad dollars at stake, so of course TikTok doesn’t want to discuss them. And neither do the world’s biggest alcohol producers (the ones who control some of the largest advertising budgets). But are you surprised? TikTok spent 2020 fending off a Trump-induced international merger/shotgun wedding, an ordeal that would make even established players cagey. And booze brands are a real snooze about this sort of thing on account of, y’know, potentially getting sued into the stratosphere.
But we can’t just give up, can we? (No!) So instead, we’ll start this party without them. And there’s no better way to kick off a conversation on TikTok’s lucrative, almost certainly inevitable destiny in alcohol advertising, than the curious, never-say-die case of Snapchat.
“ALL REASONABLE STEPS”
Now, this bit is going to sound familiar, and that’s on purpose. Once upon a time, there was a mobile-first social video sharing platform. It burst onto the scene seemingly out of nowhere, an upstart app with a cutesy name that had, overnight, lured the world’s very online youth from legacy social-media platforms. The press was fascinated by it, Mark Zuckerberg felt threatened by it, and advertisers ponied up big bucks for an audience with the locked-in eyeballs of tomorrow’s consumers.
Such was the view from Snapchat’s catbird seat last decade. To oversimplify, Snapchat (launched 2011) was TikTok before TikTok was even Douyin (its Chinese older sibling, launched 2016), much less itself. But despite having the metrics and momentum that big-ticket agencies drool over, beer, wine, and spirits brands held back from Snapchat. A digital director at William Grant & Sons summed up the industry’s reservations to Digiday in August 2017: “We just have to wait for the demographics of the community, or the advertising options, to catch up to our responsibilities as marketers of spirits.” (William Grant & Sons did not make its ad team available for an interview for this piece.)
In other words, with a user base so firmly anchored by millennials and Zoomers, Snapchat was forbidden fruit, ad-wise. But eventually, booze brands began to bite. and get bitten. In January 2018, after the United Kingdom’s Advertising Standards Authority ruled that a Captain Morgan Snapchat filter improperly targeted drinkers below the country’s legal drinking age of 18, parent company Diageo immediately pulled all its advertising from the platform.
At the time, a company spokesperson told CNBC that Diageo “took all reasonable steps to ensure the content we put on Snapchat was not directed at under-18s [the legal drinking age, or LDA, in the U.K.] – using the data provided to us by Snapchat and applying an age filter.” If you can’t feel the fury seething from the lines of that statement, you haven’t read enough of the mind-numbing, mealy-mouthed corporate gobbledygook that major alcohol companies’ communications departments typically put out. Here’s guessing that Snapchat was on the receiving end of a few, erm, tense phone calls from the world’s largest liquor distributor during that episode. (Snap Inc. did not respond to VinePair’s interview request for this story.)
For Snapchat, the gauntlet had been thrown down. Until the platform could guarantee that a majority of its users were the legal drinking age or older, and that no alcohol brands’ ad content would be served or sent to underage users (the ones, let’s be real, that made Snapchat such a hot property for forward-thinking marketers in the first place), it would be deprived of Big Booze’s big bucks.
It was a financial and reputational setback for Snapchat, which had already improbably clawed its way from campus nudes clearinghouse into global mobile messaging juggernaut. And you have to figure that TikTok’s U.S. ad team (some of which came from Snap) took notes.
$500 MILLION AND STILL (MOSTLY) SOBER
While Snap has receded from the top spot on America’s social media roster, its predicament remains very real for the video-sharing app that has since stepped into that limelight. With 2 billion downloads and counting, and 850 million monthly active users (or MAUs, in the jargon), TikTok is the indisputable, white-hot center of the contemporary social media ecosystem.
American advertisers agree: While TikTok’s nascent ad business only netted $200 to 300 million globally in 2019, The Information projected that the app would bring in around $500 million in advertising dollars in 2020 from the U.S. alone. (Mind you, TikTok’s business is just one slice of pie for parent company ByteDance, which draws much of its $27 billion revenue from China. For context, Facebook, which owns Instagram, clocked $84.2 billion in global ad revenue in 2020.)
Experts compare the platform’s ad potential favorably with Snap, which did $1.7 billion in revenue last year. “There’s opportunity for TikTok to get to Snapchat-like revenues just on the back of a standard advertising offering,” Mediaocean CMO Aaron Goldman told Quartz in October 2020.
But if TikTok is going to catch up with Snapchat – much less Twitter, or the big blue Facebook beast – it’s going to have to do it without drinks-industry dollars for the time being. That’s partly self-imposed: The platform explicitly bans alcohol advertising to American audiences. And the first line of the “prohibited products” list for U.S. advertisers in the company’s ad guidelines doesn’t offer much wiggle room: “Ads promoting alcoholic beverages (wine, beer, spirits, etc.), alcohol clubs/subscription services, alcohol making kits, or alcohol sponsored events.”
This blanket ban may be a defense mechanism for a company in a full-blown sprint to add platform features, nurture its creator community, and adjust to its poll position in America’s app marketplaces. “TikTok is going to need to figure out what to do with all the power they have before they let alcohol advertisers” onto the platform, muses McGlew.
A TikTok spokesperson, Kellie Norton, declined VinePair’s request for an interview, confirming only that alcohol advertising “was not permitted on the platform,” and referring back to the company’s published policies. But it’s not hard to guess one reason why the platform is wary of letting booze brands pitch their liquid wares using its algorithmic advertising marketplace. TikTok users skew young – if not quite as young as you think.
AGE IS JUST A (VERY IMPORTANT) NUMBER
“I don’t want the stigma to be like, ‘Oh, TikTok is only for children,’ because I do not agree with that” says McGlew, the strategist, who estimates that she personally spends about five hours a day creating and consuming content on the platform. She says the existence of flourishing communities of users “in their 30s, 40s, 50s, and 60s” is proof-positive of the app’s post-teen appeal.
Stigma noted, and anecdotally debunked. But there is some statistical proof that TikTok’s biggest fans are also its youngest. In August 2020, The New York Times reported that an internal TikTok document showed that around a third of the platform’s daily active users (DAUs) were under 14. (At the time, the company responded with a statement claiming it conducted “high-level age-modeling to better understand our users and allow our safety team to better protect the safety of our younger teens in particular.”) Compared to more developed platforms like Instagram, Twitter, and Facebook, which have strong popularity across several age demographics, TikTok’s was then, and likely still is, somewhat concentrated in the teens – an obvious problem for alcohol advertisers restricted from pitching non-LDAs.
“Our folks are very conservative about this, so they’re not going to go forward unless they have a fairly high degree of confidence that the demographics are there,” says Mary Jane Saunders, vice president and general counsel for the Beer Institute, a national trade group. Brewers, loathe to do anything that might jeopardize their ability to self-regulate their advertising practices, keep a close eye on digital media providers’ demographics, Saunders continues, with a very specific number in mind. “They investigate whether the audience is reasonably expected to be at least 71.6 percent adults of legal drinking age” – the percentage of LDA adults in the U.S., according to the 2020 U.S. Census. “I can’t emphasize enough: They’re cautious.”
This is why the world’s biggest alcohol brands don’t seem to mind being told their money is no good with TikTok. As it stands, they wouldn’t risk spending it there anyway. Or even risk talking about spending it, for that matter: VinePair contacted Anheuser-Busch InBev, Boston Beer Company, Campari Group, Constellation Brands, Diageo, Heineken NV, Mast-Jägermeister, Molson Coors, New Belgium Brewing, Sazerac, White Claw, and William Grant & Sons seeking interviews for this piece and not one agreed.
Like the Beer Institute, the Distilled Spirits Council of the United States publishes, administers, and adjudicates advertising codes to which its member brands agree to adhere. Noting TikTok’s current alcohol advertising prohibition, Courtney Armour, chief legal officer and corporate secretary at DISCUS, told VinePair in a statement: “If they ever change their policy to allow alcohol advertisements, a spirits advertiser would need to abide by all [DISCUS] Code provisions in doing so.” Those rules match the Beer Institute’s 71.6 percent audience figure – something that, for now, TikTok can’t offer. Otherwise, Armour continued, TikTok would have to give booze brands the ability to “directly communicate” to LDA audiences.
THY HASHTAG RUNNETH OVER
But just because major booze brands aren’t welcome to advertise on the platform doesn’t mean there’s no booze on TikTok. User-generated drinks-related content plays well on the platform, says McGlew. On TikTok, “cocktail recipes are really fun to watch. . The content is super-tightly shot like hands and pans,” a style of social food and drink video popularized on Facebook and Instagram by publishers like BuzzFeed’s Tasty vertical late last decade. “But the angle has been changed from top-down to sideways view,” improving the viewing experience, she says.
It shows: The #cocktail hashtag on the platform boasts thousands of such videos, which together have earned a respectable 1.3 billion views to date. Some of those belong to John Rondi Jr. and Sr., the self-described “dynamic father & son duo” behind JohnnyDrinks, a beverage-based TikTok account with around 670,000 followers. The Rondis post accessible, informational videos, with Senior (55) narrating his cocktail-making process while Junior (25) peppers him with questions. “Beer does well” on TikTok, says Junior, “but yeah, I would say cocktails probably perform better.”
The Rondis, like other drinks-related TikTok creators, partner with distilleries to offer private-label barrels and collaborations, and sell alcohol-adjacent bar paraphernalia and T-shirts via their website. All of that appears to be within TikTok’s community guidelines, which prohibit using the app to trade or sell alcohol, or teach viewers how to make homemade hooch. Producing #sponcon for booze brands, on the other hand, would probably fall under the category of an ad – but it’s murky, and smaller alcohol companies may be willing to risk it.
What’s the worst that could happen? Hard to say. On one end of the spectrum is the risk of ending up in a less brand-safe corner of the platform, such as #drunktok (36.4 million views) or the #alcoholic tag (563.4 million views.) Worse, the move might elicit a slap on the wrist from the platform itself for violating its guidelines, or scrutiny from the Federal Trade Commission, which has rules for how creators must disclose endorsements.
New Belgium Brewing may have found a safer workaround. The company’s flagship, Fat Tire, has its own account on TikTok, on which it creates original, earnest, beer-oriented content for a small number of followers. Its bio includes “21+” but there’s no way of telling its followers’ true age. @FatTire’s videos aren’t really “ads,” so they seem to come down within existing platform rules as-written. (New Belgium spokesperson Leah Pilcer confirmed to VinePair that this account was operated by the company, but declined to comment further.)
“It’s like the Wild West right now,” McGlew says, likening brands’ haste to get onto the platform to a gold rush. “Inevitably we’re going to have some shady people move out West to mine for gold. But the gold is there.”
RESTRICTION WILL SET YOU FREE. OR WILL IT?
The good news for TikTok and any alcohol advertisers itching to get on the platform is that the technology to “directly communicate” with LDAs already exists. “On other social media platforms like Instagram and YouTube, you can get individual channel demographics,” says Evan Asano, CEO of MediaKix, a social media consulting firm.
For example, in the wake of its Diageo disaster, Snapchat rolled out new functionality designed to give alcohol advertisers even more control over who saw their ads. “Snapchat has had the most challenges with [age-gating] so they are taking this really seriously,” a Heineken media director told Digiday approvingly in October 2018.
Let’s say TikTok drops its booze ban and begins offering alcohol advertisers the same capabilities as other major platforms. It could happen, and soon: According to The New York Times’s August report, the company already “does not rely only on users’ self-reported dates of birth to categorize them into age groups. . It also estimates their ages using other methods, including facial recognition algorithms that scrutinize profile pictures and videos.” (This “age-modeling” also includes comparing a user’s age statement with their behaviors and that of their network to detect young users who lied about their birth date when signing up.)
If TikTok offered those types of age-restriction and targeting tools, alcohol advertisers would likely flock to the platform. It’ll be the “Wild West”-style gold-rush moment McGlew envisions. But she’s circumspect on whether advertising – particularly from beer, wine, and spirits brands – can actually find gold on the platform through traditional advertising, no matter how well targeted it is. “TikTok is the first place to call out bullshit,” she says. If an ad campaign misappropriates one of the fast-moving and esoteric cultural ticks that drive virality and excitement on the platform, they run the risk of turning themselves into a mockery.
“Figuring out your organic strategy is probably a bigger priority than doing paid if you’re trying to be on the platform long-term.” McGlew says. “If you don’t do it right, in my opinion you almost look worse.”
With the legal and cultural stakes so high, alcohol advertisers have every reason to keep TikTok at arm’s length for now – and good thing, because the platform isn’t ready for them, anyway. But one day, it probably will be, and when it is, buddy, you’d better believe the slick booze brand collateral will soon follow. Whether it’ll pass muster with TikTok’s no-bullshit audience. well, that’s another story entirely.