The creator economy is changing the media landscape and empowers the creative types to make money through their passion. Discover what it takes to become a part of this economy, and how to capitalise on the earning potential and the outlook of this industry.
What is Creator Economy?
The creator economy, more often referred to as the influencer economy, is an ecosystem consisting of passionate and creative individuals. They are dedicated to transforming the media landscape by using their creative abilities to produce content that their audience will enjoy and will be utilised by brands for their specific purposes (usually for marketing).
The estimated creator economy market size is more than 50 million, according to a report from SignalFire. The creator industry is made up of content creators, bloggers, videographers, curators, social media influencers, and so on.
The rise of digital marketing paved the way for these creators to have a platform wherein they can explore growth opportunities. Indeed, it is now possible for a creative individual to set up a YouTube channel or Instagram page and build a following by creating content around a specific niche or topic.
When it first started, the creator industry was viewed as a side hustle for individuals looking to produce other income streams. The rise of digital platforms such as YouTube and Instagram has enabled creators to grow and make it their primary source of income. Over time, newer platforms entered the picture such as TikTok, Clubhouse, and more. Content creators get paid through sponsored posts, brand deals, ad share revenue, affiliate links, courses, and more.
Creator Economy Industry Insights
Based on the report from SignalFire, there are approximately 50 million content creators worldwide. As of now, the majority of these content creators are monetising their content creation on a part-time basis (also known as amateur content creators). Meanwhile, roughly 2 million are making content and earning from it on a full-time basis.
The creator economy market size has more than doubled since 2019, based on statistics from Statista. The same source reveals that this industry is currently worth $13.8 billion.
An understanding of what is creator economy and how it grew at such a rapid rate requires a look back on how the foundational media platforms started. The late 2000s gave birth to the rise of platforms like Instagram, Twitter, and YouTube that enabled creators to be discovered and build an audience by leveraging the algorithms of these virtual platforms. The existing algorithm on these platforms made it possible for creators to distribute content with ease.
Over time, these platforms introduced more sophisticated tools like multimedia editing. Content creators made use of these tools to polish their content while having the ability to cross-promote the content to other platforms with a click of a button.
It was only a matter of time before monetising influencer reach became the norm. Top content creators who were able to build a large enough following could earn profit by advertising products and services from brands. This led to the rise of sponsored content, as well as the establishment of influencer marketing agencies and sponsorship marketplaces. With data from Mediakix, it is estimated that the industry is worth $15 billion by the end of 2022. This makes it one of the fastest-rising sectors in the business industry.
With lots of growth opportunities for the creative types, it gave way to the rise of creator economy startups. This is now the state of the creator industry. With these creators having built a loyal following, many of them have ventured into creating their full-fledged businesses. Banking on their reputation and the support of their interactive community, these “influencers” have explored many business opportunities such as creating products (e-books, merchandise, courses) and selling services (such as coaching, consulting, etc.).
The last one is an important insight into the trend of this economy in the near future. With content creators finding ways to monetise their content creation directly from their fan base, it opens up an unlimited earning potential. They no longer had to rely on brands, businesses, and third-party sources for earning opportunities like brand deals and sponsorships.
This is a dynamic economy that is constantly shifting based on the existing media landscape, as well as the availability of platforms for these content creators to exploit. Here are some of the trends that experts foresee in the future:
- More brands are dedicating a significant portion of their marketing budgets to creator campaigns. According to influencer marketing platform CreatorIQ, 66% of brands surveyed are planning to allocate more budget towards creator marketing. Many of these brands claim that up to 75% of their overall marketing budget is dedicated to paying content creators.
- According to The Information, the total value of creator economy startups totaled $5 billion in 2021.
- TikTok and Instagram Stories continue to emerge as the top platforms for content creators for engaging with their followers and customers.
How Brands Can Capitalise on Creator Economy
The opportunities and outlook for the creator economy are on the upward. Brands that want to succeed with their marketing effort should acknowledge who are the critical players in the field of content creation to leverage their reach and boost their brand success.
As a brand, you can take advantage of this growing industry to connect with your target consumers in a way that makes a difference. Choosing to work with content creators that have a solid bond with their followers will enable you to bring that same value to your business. It also enables your business to build a natural community among these followers.
If you are a brand planning to engage an interactive community with the help of the content creators, here are some tips to consider:
1. Rethink your brand’s value proposition
In the past, there is an emphasis on storytelling as a potent marketing tool. While this is still recommended, it is often not enough, especially in this landscape wherein people seldom build an instant personal connection with brands. This is why working with content creators makes sense since they are more rooted and have a natural connection with their audience.
The best way that you can showcase your brand story and make personal connections with your target audience lies in choosing the right influencers to work with. There are millions of them out there so make sure you find a voice that fits your brand.
2. Support the creator with the right tools
Content creators now add more value to a brand's marketing campaigns than they did before. This is why choosing to work with influencers requires that you support their growth. This includes providing them with the tools that enable them to showcase their creativity and giving them creative control over what they do.
This emphasises the importance of choosing influencers that align with your brand and voice so that you can give them the creative freedom they need. Taking this approach will add more value to your partnership and help achieve your marketing goals organically.
3. Shift your marketing approach
In the creator economy, the content creators have power over the brands (not the other way around). This marks the shift in the way brands approach marketing and if you want to succeed in this revamped marketing landscape, you need to foster long-term relationships with influencers. Focus on building relationships and earning the trust of those that look up to these content creators. This should be your new focus instead of making one-time conversions.
Factors that Contribute to the Growth of the Creator Economy
It’s a fact: the influencer economy is on the rise. It’s significant for marketers to know that and to keep up as influencer marketing continues to solidify its importance in the overall marketing landscape.
For content creators, it is important to identify the factors that can contribute to more growth in the industry and open up more opportunities in the years to come.
Low barrier to entry
One of the reasons why this industry is booming is due to its accessibility. Anyone who has access to the internet can and is active on social media has the potential to become a content creator. Your ability to distinguish yourself from all other content creators and build your brand is the key to growing as an “influencer”.
Availability of platforms
The internet is also another critical factor that can contribute to the growth of this economy. There are many platforms now available that make it easy for influencers to create content for brands that are equipped with technological features such as shoppable content, integrating ads, and affiliate linking.
Ability to diversify revenue streams
Another factor that can help to grow this industry is the ability to diversify the revenue streams. Gone are the days when the only way for content creators can generate income is through their content from ads revenues. Nowadays, there are more monetisation options available to them such as direct brand sponsorships and even from content creators building their businesses.
Access to tools and technology
Finally, the most critical factor for growing the creator industry is the access to tools and technology that facilitate their creative freedom.
At Compass Offices, we offer flexible solutions for all kinds and sizes of businesses, which include creator economy startups. Instead of building your own office space, you can leverage the technological tools, IT support, and other infrastructure that are available in our flexible office spaces so you can focus on content creation.
While it is true that the internet is more accessible nowadays, professional content creators need dependable internet access and qualified IT professionals at their disposal to ensure that you can sustain the growth of your business. At the same time, you want a working environment that is easily scalable so that it can adapt to the growing needs of your business or startup.
Our flexible office spaces are equipped with a wide range of products that are designed to meet the needs of your growing team (or for individual content creators). Get in touch with us today and find out how we can help your business thrive!