Why TikTok Ads Fail for Most Businesses and How to Change That: PPC Agency Sydney Insights

TikTok advertising is completely different from other forms of PPC advertising. Although paid advertising has measurable results based on clicks, predicting results from TikTok advertising is more challenging.

TikTok Ads cannot reach your target audience explicitly with keywords. The creativity and originality of your TikTok videos is what makes an advertisement discoverable on this platform.

Entertainment comes first. The demand for the product in your ad comes second.

Many Sydney businesses fail to get visibility on TikTok because they misunderstand the TikTok algorithm. Learn how it really works in our in-depth guide from a PPC management agency Sydney businesses trust.

According to TikTok’s creative guidelines, 63% of successful ads on TikTok convey the main message in the first 3 seconds. In fact, the endless scroll has trained brains to consume content in short bursts only. This phenomenon is now known as “TikTok Brain”.

So if you don’t hook your audience instantly, you risk losing them easily with just a swipe. But at the same time, getting straight to the point doesn’t mean that you no longer have a story to tell. Your TikTok ad should always be the story first, with all the entertainment the TikTok user needs rather than the sale of your product.

In other words, your ad hook must be short, informative, and still capable of capturing your audience’s attention within the first 3 seconds!

TikTok might be known as Gen Z’s favourite app, but that picture is changing. Millennials and Gen X are now spending serious time on the platform, which means the range of products that sell well on TikTok continues to grow.

To get a better idea of where your business lands with TikTok, given below are the most common product/service categories that get picked by the algorithm:

• Fashion and beauty products
• Home decor and lifestyle gear
• Health and wellness products
• Tech gadgets and accessories
• Food and beverage items
• Personal care and grooming
• DIY and crafts
  

TikTok is ideal for products and services that look good on video. In addition, TikTok users have a short attention span with the easy scrolling option available to switch from one video to another. So, if your business offers a product or service that provides quick solutions, that would be a strategic way to make use of this short-content form based platform as part of your digital marketing strategy.

When TikTok ads don’t deliver results, it’s rarely because of an issue in the platform. TikTok behaves differently from search and social platforms built around intent. First, let’s understand why TikTok ads fail:

1. Treating TikTok like a performance channel too early.

This is the most common mistake. Businesses expect TikTok to behave like Google or Meta from day one. But TikTok needs time to build engagement signals before conversions stabilise. When campaigns are judged too quickly, they are paused too early before they’ve had a chance to work.

2. Chasing virality instead of relevance.

Viral reach doesn’t mean proper business results. Ads fail when the focus shifts to views rather than attracting the right audience. TikTok rewards content that feels interesting, but relevance is what leads to clicks, leads, and sales.

3. Sending cold traffic to the wrong funnel stage.

Many TikTok ads underperform since they push cold users straight to sales pages. TikTok introduces people to your offer but it doesn’t replace the need for education or trust. When the funnel doesn’t match user awareness, engagement drops and getting conversions is not possible.

4. Underfunding the learning phase.

TikTok ads fail when budgets are too small to generate meaningful data. Without enough spend, the algorithm can’t identify patterns, and your business will be making decisions based on incomplete information. Low budgets produce false negatives.

5. Measuring the wrong signals early.

Early TikTok performance should not be judged on ROAs alone. Watch time, engagement, and repeat interaction mirror first. When your business focuses on wrong metrics too soon, they mistake normal learning behaviour for failure.

None of these issues mean TikTok is the wrong channel. They point to a mismatch between expectations and how the platform works.

Once your business adjusts how they think about TikTok with a PPC agency’s expertise, performance becomes far more predictable.

You need to start off by creating a TikTok business account since it has built-in analytics for running targeted ads. Before spending on TikTok ads, you can see how people actually interact with your content once this account is set up.

Personal vs. Business TikTok Account

The next step is not to run the biggest TikTok campaign your marketing team can come up with. Begin by understanding that TikTok is a signal-building channel. People open this app to watch something entertaining or when they crave to get answers for things that interest them. So don’t expect immediate conversions.

With this mindset shift, begin your TikTok campaign to understand what type of content people respond to and which problems catch attention. Then show up consistently with short-form video content that your target audience loves.

Trust conversions to follow later but have a PPC agency in Sydney analyse metrics such as CPM and CPC to identify which content is building the strongest signals for retargeting. Early success is measured by whether the TikTok algorithm is learning who your audience is and how to reach them.

To make TikTok work long term, your digital marketing team needs a system where multiple ideas are tested so that patterns can emerge over time. Rather than perfection, focus on consistency since one winning ad isn’t enough for TikTok to pick up your channel.

TikTok moves fast. Within a few seconds, trust is built or not at all. User-generated content tends to perform better because it feels real. Highly polished ads can look like interruptions to a TikTok user accustomed to raw videos sharing personal experiences or genuine ideas.

A good example of this is how Vaseline uses TikTok. Instead of overproduced ads, the content looks like something a real person would post. You can see ads where a real person is holding the product up to the camera, using it as part of a routine, or sharing a quick “finishing touch” moment. It blends into the feed because it mirrors how TikTok users already create content on the platform.

With our PPC agency experience in managing TikTok ads for businesses in Sydney, we have observed that certain types of UGC work better on TikTok:

• Product reviews and first impressions: Short, honest opinions about a product or service build trust quickly. They work because they answer the viewer’s silent question: “Is this actually worth my time or money?”
• How-to and demonstration videos: Content that shows how something works or solves a problem holds attention longer than promotional messaging. These videos feel useful, not sales-driven.
• Reactions and real responses: Genuine reactions, whether positive, surprised, or curious feel unscripted. That authenticity encourages viewers to keep watching and engage.
• Before-and-after style content: Simple transformations help people understand value without being told. Seeing change over time is more convincing.
• Everyday use or routine-based content: Videos that show how a product or service fits into normal life make it easier for viewers to picture themselves using it.

What all of these formats have in common is credibility. They don’t try to sell immediately. They focus on showing rather than telling what you want your customers to know. And guess what? This is exactly what TikTok’s algorithm as well as your target audience responds to.

For most Sydney businesses, TikTok is worth investing in once you notice people are watching ads through without skipping immediately. As engagement levels increase, a TikTok Ads specialist will help you understand which messages or formats are outperforming others. This is when you need to spend more on retargeting.

Another key factor is business readiness. TikTok tends to work best for businesses that:

• Have a clear offer and landing experience
• Can commit budget long enough to test properly
  

Working with an experienced PPC agency in Sydney means that you won’t be spending unless the digital marketing strategy will actually help your TikTok project to become a reliable growth channel.

Want a clearer idea of TikTok ad costs in Sydney and how much your business should be spending? Our Sydney PPC agency blog breaks it down.

Going viral on TikTok can look impressive, but it rarely leads to consistent enquiries or sales. Although viral content reaches a broad audience, it’s not always the right one.

What drives results is a clear path from interest to action that is relevant to your target customer base. If you are unsure whether TikTok ads are right for your business, or how to turn views into real leads, a PPC specialist can help.

AT Digital is a trusted digital marketing agency in Sydney with an expert PPC marketing team that can help you assess whether TikTok fits your growth plan and how to approach it without wasting budget. Book a free consultation to get started on your TikTok ad strategy.

• Can the TikTok Algorithm Really Help Your Business Grow? PPC Management Agency Sydney Explains
• Sydney PPC Agency Reasons Out How Much a Business Should Spend on TikTok Advertising