By Jessica Phillips, Founder & CEO, The Social Standard
The Creator Economy is a wave that has been building. About three years ago, there was a surge of micro-influencers and niche markets that joined social media celebs. That trend continues to expand as consumers look for their own communities and passion points. Who will hold the power when it comes to content and how will this impact the media and entertainment industries?
Platforms no longer have complete power
The power shift from platforms to creators has finally happened. Creators do not need to rely solely on media channels, now that they are sought-after entities in their own right. How will creators use their fame to succeed? Tipping, subscriptions, and direct sales provide ways for consumers to vote with their dollars by supporting content they love. Smaller, niche creators will thrive off of subscriptions — by developing cooking videos, DIY workshops, or newsletters. This group will mainly derive revenue online.
Macro creators will find ways to monetize their audiences both on and offline. More influencers will show up at events, for example at sports tournaments or creator-led competitions, building brands and really taking a page from the Hollywood-celebrity playbook.
When a creator grows to a certain point they stop converting well for advertisers and primarily drive revenue for their personal brand (via merchandise, tours, creator competitions, and business lines closely tied to their online personalities). This new trend opens the door for creators to become brands and businesses, themselves.
When Instagram started, it had a strong hand in the pursuit of art. Photography meet-ups happened everywhere and that was the beginning of teaching everyone how to become a creator. Fast forward to individuals posting about their regular lives in “beautiful” ways, and now these “real life” creators are more relatable than aspirational. This relatability allows creators to build a true connection with their followers. That final piece is crucial to brand building and monetization. Distribution is no longer enough, you must have a connection to maintain control.
The future of media and entertainment
Platforms are offering new ways for creators to monetize their presence – it’s good business. Look at the reputation YouTube has had in entertainment. By sharing the ad revenue with its creators early on, it ensured its success. Over the past several years, we have seen big media companies like Disney and AT&T rolling up all forms of media. But, will they be able to keep up when we have new places and ways to consume content popping up constantly. Think TikTok, Substack and Patreon.
Consumers want niche content too. So they will follow the bigger influencers and celebrities, but they also want content relevant to them and in most instances, they are willing to pay for it.
Entertainment is taking place both on and offline
The lines are blurred yet again between online and offline experiences. This model isn’t something entirely new though. Look back to the days where TV reigned supreme – you had incredible live events happening all over the world and some people showed up to participate in person while others watched from the comfort of their own homes. The exact same thing is happening with the internet and live entertainment. The game is the same, but the medium is different. And the final catch is that viewers at home are no longer content to simply watch. They want to be involved in the action – with behind-the-scenes content from athletes/influencers where they can participate. They want podcasts and TikToks and Instagram stories to be the way that they engage before, after and during events. This is a big reason why esports has gained so much traction – fans feel like they are part of the conversation.
A case in point is YouTube snagging the naming rights for Hollywood Park. This has the potential to be a blockbuster move if they can tap into the success of creator competitions we’ve seen take off in the last year with Logan Paul vs KSI generating $50M in revenue.
The Creator Economy can’t be put neatly into a box – it’s a movement brought on by millennials and Gen Z who demand to participate in all aspects of life both online and offline.