The past few years have marked a significant period of growth for the creator economy and the social media platforms that underpin the industry. Evidence of this expansion is in the numbers: the creator economy is estimated to be a $13 billion industry worldwide, $12 billion more than reported only five years ago. And while there’s no denying the impact influencer marketing has already had on ecommerce, there’s still much to be debated about what the future holds.
The Information, a technology-focused online news outlet, recently hosted their inaugural Creator Economy Summit . The one-day virtual event brought together executives, founders, and creators across the creator economy. Panelists reflected on their experiences both shaping and participating in the industry, and contemplated how they expect the landscape to change in the coming years. The summit’s sessions focused on topics ranging from the growing popularity of social commerce to the rise of the creator “middle class” and creator burnout and mental health.
8 of the 25 featured speakers at the Creator Economy Summit. (Source)
Throughout these forums, a fundamental theory echoed in the comments shared by creators and industry executives alike: creator-generated content is here to stay, and the platforms and brands that wish to participate in this industry must learn to adapt to the creators’ needs, not the other way around.
Here we’ll take a closer look at this belief along with other major takeaways from the summit, and assess what these predictions mean for creators, platforms, and the industry as a whole.
Access & Monetization
As creators seek to increase the ownership of their work, fans should expect to grow accustomed to the model of paying for access to creator-generated content. Ali Berman, Partner & Head of Digital Talent at United Talent Agency, anticipates there will be, “a major shift in the transactional relationship between fans and talent…we’ve been in an age where we get content for free from creators,” but Berman and others expect this will change.
Patreon is a prime example of social media platforms earning creator praise due to their pay-for-access model, but many other platforms are catching up.
“Creators are starting to realize the value they actually put into the marketplace,” noted Amber Venz Box, Co-Founder & President at LTK. Venz Box reflected on this creator awakening during her co-panelled session with Bryan Moore, Co-Founder and CEO at TalkShopLive. “Platforms are realizing they need to cut the creator in,” said Venz Box, “and at the same time creators are realizing that some of these platforms aren’t made to support them either.”
Venz Box, among other panelists, warned that creators will gravitate toward the platforms that are better suited to accelerate their professional growth; and more than ever, this growth needs to come in the form of monetary compensation, not just followers.
In the past, creators’ personal needs have been ignored to focus on revenue generation through ad streams. But the ability for platforms to develop new monetization tools, such as tipping, ecommerce referral programs, or premium subscription models, will arguably attract more creators in the long run. These tools will enable creators to spend less time looking for new ad streams, and instead allow them to focus on what they love doing most — creating high-quality content for their fans. Adversely, if platforms only reward creators for ad streams, burnout will continue to hurt the industry and pressure those creators to find new platforms that offer alternative monetization options.
A Changing Competitive Landscape
Brands should prepare for more creators to enter the playing field as competitors.
Jim Shepherd, Global Head of Talent Partnerships at Snap Inc., sees a fundamental change coming to the way in which creators approach their own growth strategy. “A lot of the last 10 years for creators has been about growing the biggest audience,” Shepherd maintained, “but the next 10 years will be about monetizing their biggest fans.” Monetization will come in many forms, such as paid subscriptions or brand partnerships, but opportunities will also present themselves through entrepreneurial ventures, enabling creators to bring their own original products to the marketplace.
We’ve already seen creators become entrepreneurial powerhouses in their own right, with the likes of Huda Kattan (Huda Beauty) and Arielle Charness (Something Navy) experiencing major success with their makeup and apparel lines, respectively. Creators who were previously advertising products from their favorite brands are becoming those same brands’ biggest competitors. This evolution of creator entrepreneurship is bound to introduce new products into the market, many of which will have an edge on other, existing businesses due to loyal fan bases.
Marketing teams should be prepared to address these new challenges in the competitive landscape, where brand loyalty is based largely on a personal attachment to the creator before the product itself. But brands can still make the most of fan and creator loyalty by selecting the right individuals for partnership opportunities.
Making The Right Creator Partnerships
It’s estimated that over 50 million people worldwide consider themselves to be creators. As the count grows and the industry itself accumulates more value, influencer marketing will continue to eat away at more traditional marketing efforts.
Creator partnerships provide an opportunity for brands to more authentically advertise their content and reach engaged audiences. Casey Neistat, YouTube creator and entrepreneur, provided insight on this as well, commenting that he’s seeing smaller niche channels with lower subscriber counts still have measurable monetization opportunities with brands who want to speak to their specific audience. “What this means is it’s not about dominating any given platform, it’s more about making meaningful connections with an audience,” said Neistat.
This observation ties into the rise of micro-influencers, smaller-scale creators with focused audiences who often share content around specific topics or industries. These individuals often see higher engagement rates because they have carefully curated a following of loyal supporters, and are valuable assets to brands looking to improve awareness with niche audiences.
Nail polish brand Revel Nail features content from unique nail art micro-influencers, showing the brand’s dedication to embracing the nail art community and its followers.
With an abundance of creators entering the industry, it’s likely that brands will have more options for creator partnerships in the future, and finding the right influencer can make all the difference. Ecommerce teams should be prepared to handle new types of exchanges that can take place between creators and consumers as well. It’s expected that the forums by which consumers engage with creators will continue to evolve. To discover and manage relationships with creators as these changes continue to take place, top brands often use an influencer marketing platform like Pixlee for Creators. This offers a solution to streamline influencer campaign operations while working with multiple creators at once.
Brands should also be prepared to make deals with creators and provide compensation and other incentives commensurate with the value these creators will bring to their business. Jack Conte, co-founder and CEO of Patreon, is optimistic about the financial future for creators, and believes that creators, like anyone else, “deserve to be paid for the value that they’re contributing to the world.”
As far as what the future holds, here’s what we know: platforms will evolve, companies will merge (or dissolve), and all the while creators will be at the center of a massive disruption in how consumers purchase goods. This is a pivotal moment for the creator economy, and as we head into the coming year we’ll be on the lookout for more advancements in technology that will change the way creators, consumers, and brands can make the most of the industry.
To learn more, check out The Information and sign up for their Creator Economy newsletter.