Insights / 29-10-2021
Nowadays, anyone with an internet connection has the potential to become a creator. We are one photo on our phone away from showing our favourite restaurant, one tweet away from voicing our opinion, and one touch from live-streaming our favourite gaming tips to friends and fans in another. That is the creator economy, and everyone is talking about it.
So what is the creator economy? According to a report done by SignalFire in 2020, it is defined as the class of businesses built by more than 50 million content creators and the tools designed to help them monetize it and grow. The modern celebrities can no longer be found in just red carpets, they are teenagers who are making funny videos on TikTok, musicians who are sharing their music on YouTube, people are even live-streaming and doing exercise together. Whoever you are and whatever you are into, the internet has a community for you.
“Rather than ten TV shows consumed by billions of people, we now have hundreds of millions of shows that cater to billions of people. You could be only one of ten people in the world interested in a niche topic, but chances are you’ll find content for it. Additionally, the people who are creating content for that topic are truly and authentically passionate about it.”
We are all part of the creator economy in some shape or form. To put things into perspective, in the United States, the average adult spends around 30 minutes per day on Facebook alone. And on the other hand, we have the 16-24-year-olds demographic devoting a median of 3 hours a day to social media. When we look at numbers in China, we see that people are spending more time watching live streaming than in comparison to all forms of TV put together. This is a major time of their day spent on social media, and it has created many opportunities for creators to showcase their content.
Social media powers the creator economy. It is the ecosystem where creators can find a community that resonates with their content and make a living out of it. As an example, YouTube alone expects a $30 billion stream of revenue at the end of 2021. The world’s largest social network, Facebook, has created a $92bn-per-year advertising business in which they sell ad space that can be seen by its 2.8bn users. Tik Tok has also launched a $2 billion creator fund to attract creators who produce the most engaging content. Even Snapchat has spent more than $130 million financing contributors on its short-form feature Spotlight.
Payment for creators has been transformed over the last decade. For starters, the word influencer was just starting to appear on our radar ten years ago. Now, they can get paid by platforms like Twitch or YouTube in exchange for bringing audiences to the social media channel; they are also getting paid by brand sponsors in exchange for their audience reach; they are even getting paid by fans via patronage or tipping in exchange for entertainment and community beyond the platforms. The big trend we can see here is that creators are diversifying more and more their revenue streams and becoming such an important part of the world we are living in, that different groups and industries are looking to fund them.
It has become such a fast-growing industry that nowadays there are more American kids wanting to be YouTube stars (29%) than astronauts (11%) when they grow up. A survey done in 2017 by First Choice shows that a third of the children surveyed expressed that their dream was to create content online. Research from the Lego Foundation echoes the findings and shows that 58% of children respondents can create digital content on their own. All the previous points showcase how much the creator economy has grown in such a short amount of time, and it is just getting started. As a new generation grows we can expect a lot more innovation and evolution in this space during the upcoming years.
A century ago, we used to live in an industrial environment where people would make a living out of producing tangible products. By the 1950s, once war was over and people could move more freely, the desire to have something from different parts of the world was on the rise. And with that we started to move into a consumer economy in which people started earning money and started providing services to others. Fast forward to the 21st century and the invention of the internet, our behaviour changed drastically. People were now connected 24/7 and were able to discover all kinds of information in one place, store them and share blogs and videos on the matter. And as the internet moved into the Web 2.0, we started to see more opportunities to express ourselves online.
In this new era of the internet, technology moved many people in the workforce from manufacturing to services; and with that we entered the creator economy. There was a societal shift in consciousness towards having control of our time and having fulfilling jobs. With that we started to find a new way of earning money by marketing our quirky skills, hobbies, and interests online. People are now aspiring to make a living out of something that they are truly passionate about; some want to travel, some want to play video games, and some showcase their talent- and they can all make money out of those activities.
Everyone is a creator, any person that is committed to their passion can make money out of it. Thirty years ago, who would have thought that you could earn a living from sitting at home playing a computer game? How many teenagers could have made money out of making funny videos in their backyards? Or how many amateur writers could showcase their craft to thousands of people? The internet now offers so many niche communities, that every user can find their place and influence the space.
That is why lately, brands are showing so much interest in creators. Influencers are the gatekeepers of amazing communities that can’t be reached through traditional media. They understand how the community feels and know what they want to hear and how they want to hear it.
“Creators are the experts here; they have all that insider knowledge because they know what content resonates with their audiences. Brands need to work with creators beyond just posting an Instagram photo. Those [partnerships] will be the ones that stand out and win.”
That is why we built Edge. We want to help brands find the right influencers for the right campaign in the most efficient way possible. There are no more screenshots with Edge, no more manual reporting, no more validation, no more waiting weeks for a post brief on the influencer campaign.Curious and want to know more? Book a demo and see for yourself.