Sydney PPC Agency Reasons Out How Much a Business Should Spend on TikTok Advertising

TikTok might feel like an entertainment app, but for businesses, it plays a major role in e-commerce, just not in the traditional sense that your Shopify platform does.

Right now, TikTok works mainly as a discovery and demand platform in Sydney. People see products or services in videos, get curious, and click through to learn more. The sale doesn’t usually happen inside the app. It happens after TikTok has done its job of creating interest through engagement and the user clicks on a PPC ad.

You are not paying to capture ready-to-buy demand straight away. You’ll be using TikTok advertising to introduce your offer and see how people respond to it. As unpredictable as it sounds, once you’ve created noise with your TikTok account with paid advertising strategies recommended by your Sydney PPC agency, you’ll be able to gain traction, so your business gains quality leads that generate revenue over time.

What’s more, this engagement setup is expected to change when TikTok Shop rolls out to Australian businesses in 2026. TikTok Shop will add a built-in checkout, allowing users to buy directly from videos without leaving the app.

At the moment, your TikTok PPC advertising budget is mainly being used to:

• Introduce your offer to new audiences
• Test different creative angles
• Build engagement signals the algorithm can learn from
  

In contrast to search advertising, TikTok isn’t capturing demand that already exists. Instead, it’s creating visibility and interest around your brand, which is why early performance can feel inconsistent.

Until TikTok Shop launches, most businesses budget with the understanding that interest comes first and revenue follows later. If the buying process shortens with TikTok Shop in 2026, conversion paths may improve, but success will still depend on strong creative, clear offers, and realistic budget expectations.

TikTok advertising costs in Sydney depend on local competition which pushes prices higher at certain times.

On average, businesses can expect to pay between AU$4 and AU$10 per 1,000 impressions (CPM). The exact cost depends on factors like your audience targeting, ad format, and how competitive your space is. Click costs are usually lower than search platforms, with CPC ranging from AU$0.40 to AU$1.00.

For most Sydney businesses, standard in-feed ads are where testing and lead generation begin.

There are also minimum spend requirements to factor in. TikTok campaigns require:

• A minimum lifetime campaign budget of AU$500
• AU$50 per day at campaign level
• AU$20 per day at ad group level

Sydney targeting can increase costs further. While average CPMs across Australia sit closer to AU$10, Sydney’s highly active audience (particularly Gen Z) can push bids 20–50% higher during peak periods.

TikTok offers several pricing models, depending on what you want to measure and optimise for:

• CPM (cost per 1,000 views): This measures how much it costs to show your ad to people. It’s mainly used for awareness and reach, where the goal is to get your brand or offer in front of as many relevant users as possible, not necessarily to drive immediate clicks.
• CPC (cost per click):

This measures how much you pay when someone clicks your ad. CPC is used for traffic campaigns, where you want users to leave TikTok and visit your website, landing page, or lead form.

• CPV (cost per video view):

This measures how much you pay when someone watches your video for a set amount of time (usually a few seconds). CPV is used to measure attention and engagement, helping you see whether your content is actually being watched rather than skipped.

Understanding which pricing model matters for your goal helps you spend more effectively on TikTok ads, instead of chasing the wrong numbers.

There are three types of TikTok ads your PPC specialist in Sydney can recommend:

Because TikTok ads are paid, it’s easy to expect fast results similar to Google or Meta. In reality, TikTok needs a longer learning period since it is an engagement-first platform.

Before it can consistently deliver conversions, the TikTok algorithm needs to understand how users interact with your content. That means early ad spend is used to build attention, watch time, and engagement signals before it can move towards leads or sales.

Businesses that expect instant results pull back too early, before the platform has had a chance to do its job.

Most businesses go wrong in two ways.

Firstly, they choose to advertise the wrong product or service on the platform. Success with TikTok advertising starts with generating interest. And if the target audience for your product is not using TikTok, the dollars you spend will go to waste.

The second and most common manner in which businesses mess up their TikTok advertising campaigns is by not waiting long enough. TikTok advertising is not as predictable or measurable as other PPC campaigns are, even with data analytics.

However, with the right PPC strategy in place, you can expect your business to scale with leads over time. And this wait is definitely worth the wait since TikTok is an app that almost all generations use nowadays.

Pinpointing what the right and wrong PPC marketing strategy for your business is will not be easy. But it does come down to one thing: understanding what you’re paying for.

Where many go wrong is either spending too little to get useful data or spending without a clear plan for what success looks like. Both lead to wasted budget and frustration.

A good PPC management agency in Sydney helps you set a realistic budget, understand what your ads are actually doing, and decide when to scale or stop.

If you’re unsure how much your business should be spending on TikTok ads, or whether it’s worth continuing at all, it's wise to lean into expert input early on. Save time and money with a free consultation from a trusted TikTok Ads Specialist at AT Digital.

AT Digital is a performance marketing agency with proven experience delivering revenue-driven PPC campaigns for Sydney businesses. Let’s talk!