The Trade Desk (TTD - Free Report) recently tied up with short-form mobile video platform — TikTok — in a bid to expand its advertisement foothold across the Asia-Pacific market. With this collaboration, Trade Desk clients will gain access to premium TikTok video library, which can be used for their advertising campaigns. The partnership agreement will cover 11 Asia-Pacific countries, including Australia, India, Japan and Russia.
A huge user base and viewability across worldwide makes the TikTok partnership deal more crucial for Trade Desk. The deal is likely to help the online advertisement platform provider fortify its global footprint and client base.
Notably, the short-form video sharing company has been gaining traction since its global app launch for iOS and Android platforms in 2017. Reportedly, the company has more than 1 billion user base across more than 150 countries.
Soft beverage giant, PepsiCo (PEP - Free Report) , would be the first client to access the TikTok library via The Trade Desk platform. Under the agreement, PepsiCo will run online advertisement campaign for its Lays chips portfolio in Thailand.
Trade Desk Eyeing Global Expansion
The above-mentioned partnership is part of Trade Desk’s focus on boosting its international footprint. In 2019, Trade Desk partnered with China-based media companies, like Baidu (BIDU - Free Report) , iQIYI (IQ - Free Report) and Tencent (TCEHY - Free Report) , in order to roll out its programmatic ad buying platform in the country.
The latest collaboration with TikTok will enable Trade Desk to gain a foothold in the Asia-Pacific advertising market, which per Kenneth research data, quoted by MarketWatch, is expected to witness a CAGR of 14% between 2019 and 2026.
This bodes well for the company as it is likely to acquire new subscribers in the region, which, in turn, will stoke top-line growth.
Growing Competition in Digital Advertising Market
Trade Desk is facing intense competition in the advertising market from the likes of Alphabet’s Google division and Facebook, which controlled over 50% of the global digital ad market in 2019.
However, for the last few years, Trade Desk has been gaining popularity owing to its transparency policy. The company provides its clients insights on how their ads are performing, which Google and Facebook otherwise do not. Moreover, Google and Facebook are criticized, and have been facing regulatory scrutinise due to unethical use of consumer data.
Trade Desk currently carries a Zacks Rank #4 (Sell).
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