The creator economy is booming; however, very few of us know what the creator economy really is about. YouTube coined the word “creator” back in 2011 as a substitute to the electric word “YouTube star”, which implied that only very popular persons could be successful on the platform. In recent years, the word has been revived as the number of social video and audio platforms has taken off. Twitch, TikTok, Instagram Reels, Clubhouse, and Only Fans see hundreds of millions of people creating content. Most are leisure users, but the ones that make it big can use their platform within a social media platform to reach audiences. These people are the so-called creators. Leveraging the technology to fit existing business needs or create new businesses.
Essentially, a creator is an evolution of an influencer. Connotations of being an influencer have become largely negative. Sponsored non-authentic content, free trips and hotels, staged private-jet photos and non-relatable reality. Creators, on the other hand, are usually providing value to their audience. Whether it is pure video entertainment through Twitch, a carpenter on YouTube showing off his carpentry process, a life-coaching audio room on Clubhouse or adult content on OnlyFans. The niches within the creator economy are many, and the audiences are huge.
Value streams in the creator economy
The creator economy market is estimated to be worth $104.2 billion, following a similar growth trajectory as the GIG economy. The GIG economy is made up of individual contract workers, online peer-to-peer platforms and is usually on-demand or temporary one-time gigs. Again with numerous niches serving private persons and big corporations. The creator economy is in the same way largely made up of individual creators producing content with a broad reach and purpose.
Creators make money either by producing valuable or educational content that is locked behind a paywall, where users can access it through subscriptions. Direct contributions through donations from viewers was always an integral part of the popular video streaming platform Twitch. Clubhouse recently introduced a way for users to send money to their favorite Clubhouse speakers. Many creators use products in their content naturally, which makes for a wholesome and authentic way of marketing products or services. The value streams in the creator economy are subscriptions, direct contributions and marketing. Below, we will list two opportunities and examples of how businesses can make the most out of the creator economy boom.
The oldest vertical within the creator economy is social video, popularly referred to as video streaming, or, simply streaming. Creators existed within streaming before the creator economy was a thing. Twitch is a popular alternative, especially for gaming content. On Twitch, creators are largely dependent on direct contributions from viewers in the form of donations. Recently, a gaming niche has created a hybrid revenue model through Twitch. In the world of online gambling, marketers would rely solely on writing, and sometimes, video content to promote sites and games, a more traditional form of online casino marketing. Visitors to the marketing sites would click on links from product reviews and other content, which would generate revenue for the marketer. On Twitch, it is possible to live stream the gameplay from casino games and broadcast it to viewers, who, besides donations, can also make their way to online casinos that the video streamers link to on their Twitch channels. We spoke to a representative of an online casino marketing site for Canadian players called Supremacy-Casinos, who explained that although they have so far been relying solely on traditional ways of marketing, they are also now looking to add live streaming to their marketing portfolio, pointing out that this type of content is more engaging and ultimately increases conversions and revenue. She went on to explain that the streamed gaming content can be educational information around game mechanics, recommendations, live gameplay and reactions, running commentary and pure entertainment. Effectively add several dimensions to their traditional marketing model.
Clubhouse is a new social audio app that rose to fame last year amidst the full-blown pandemic. Essentially, it is an evolution of podcasts, where discussions are held in real-time with listeners joining and have the opportunity to participate in talks. The value of Clubhouse has risen to around $4 billion in a little over a year. And it has spawned a host of competitors. Most recently, Facebook, in June they launched several social audio products, including live audio rooms. On Clubhouse, people host audio rooms, often experts within fields. A Clubhouse speaker would hold a session talking about a topic, keeping the audio room open and allowing users to be a fly on the wall and listen in on the conversations. In some cases, users who are listening get invited to join the discussion. Currently, there are no ad placements available in Clubhouse. More organic marketing methods need to be applied, getting the word out through audio, such as a brand mentioning. Marketing agencies or brands themselves can create their audio rooms with topics around what is relevant to their product, services or audiences. Clubhouse is very much “come as you are”, as a representative of Gloss Angeles mentioned in an interview, getting on Clubhouse is easier than going up on Instagram Live, no need to get dressed up, make specific preparations, or even be 100% focused. It is pure table talk. Product placement is still difficult, but the main contribution to their business has been to grow their following on other platforms through Clubhouse.
As big tech companies adapt more and more to the creator economy, we can expect this new industry to continue to boom and cement itself alongside the GIG economy in the coming years.