This document is an industry research report on TikTok released by Guotai Junan Securities. The core viewpoint is that TikTok is approaching a commercialization inflection point, with a trillion-dollar market expected, and it is recommended to pay attention to related investment opportunities.
1. Douyin Development and Commercialization Analysis: Since its launch in 2016, Douyin's user numbers have exploded. After 2020, commercialization accelerated, and its current MAU has reached 780 million, making it the largest short video platform in China. Its commercialization covers four major areas: advertising, e-commerce, gaming, and local life. Advertising revenue ranks first in China, e-commerce GMV ranks fourth, and its business landscape continues to expand, actively exploring emerging technology fields.
2. TikTok Development, User Growth, and Commercialization Research
- Development History: In 2015 - 2016, the overseas version of Toutiao made initial attempts; from 2017 - 2019, after acquiring Musical.ly, it expanded globally. Since 2020, user numbers have exploded, now ranking among the global TOP5 social apps, with revenue of about $18 billion in 2023.
- User Growth: As of April 2024, MAU has reached 1.58 billion, with a global (excluding China) penetration rate of 41.6%. In the next five years, MAU is expected to exceed 3 billion. Benchmarking Douyin, under different assumptions, TikTok's MAU in 2029 is expected to reach 3.01 - 3.81 billion.
- Commercialization: Started 2 - 3 years later than Douyin. In 2023, advertising revenue was about $13.2 billion, and e-commerce revenue was about $4.8 billion. In the future, advertising revenue per user is expected to increase fourfold, with revenue expected to exceed $150 billion by 2029; e-commerce revenue per user is expected to increase several dozen times, with revenue expected to reach $200 billion by 2029. Overall, TikTok's total revenue scale in 2029 is expected to reach $268.2 - $453.4 billion.
3. Industry Chain Benefit Analysis and Investment Recommendations: The Douyin and TikTok industry chains involve content producers, marketing service providers, and service tools. Four types of investment opportunities are recommended: advertising agencies closely cooperating with TikTok, companies actively building TikTok live streaming operation teams, overseas content distribution companies, and official tool or content suppliers.
4. Risk Warning: There are risks such as escalation of geopolitical risks and overseas market expansion falling short of expectations. Sanctions by overseas countries or improper data handling may affect TikTok's growth, and TikTok's expansion into overseas markets faces challenges such as differences in culture, consumption habits, and legal regulations.
