There has never been a stronger emphasis on the creator economy.
Monetizing digital content is nothing new, but the pandemic accelerated the sector as people turned to social and subscription platforms to supplement their income during stay-at-home measures—or out of boredom, as many TikTok stars did when they joined the growing platform as something to do and ended up finding a full-time career.
This year, the momentum from 2020 has only grown stronger.
More than 50 million people worldwide identify as content creators, and the global market has grown to well over $104 billion. A record $1.3 billion was invested in the space by investors. In addition, the middle class has grown, with 41 percent of creators earning a living wage ($69,000 annually or more) year over year.
Creators are starting their own companies. Startups are rushing to create tools and services to help these businesses manage and grow. And major brands are doubling down on leveraging creators’ reach with their audiences.
It’s easy to see why so many people believe there’s never been a better time to be a content creator—but what does the future hold? Here are some projections for the creator economy’s trends and issues in 2022.
There Will Be Creator Funds, But No One Is Relying On Them.
One of the most pressing issues that most aspiring creators face is generating a consistent income from their work.
In 2020, social platforms introduced creator funds as a means of appeasing (and, in some cases, luring) creators onto their platforms. TikTok, with its $200 million funds, led the charge. Snap began paying $1 million per day to creators who used its short-form video feature Spotlight in November 2020. (In December, the company announced that it had paid out more than $250 million to more than 12,000 creators in 2021.) Meta, which was still known as Facebook at the time, threw its hat in the ring in June 2021, announcing a $1 billion investment in programs to give creators more ways to earn money.
“At this point it’s become table stakes to have a creator fund,” says Kaya Yurieff, a reporter for The Information who covers the creator economy. “What I hear over and over again from creators, though, is that unless they had a huge viral month of video views, it really doesn’t move the needle.”
While creator funds aren’t meant to replace a creator’s full-time income, they can help supplement it. The question then becomes how long platforms will continue to invest in creator funds. “If you start paring back some of these financial rewards, you’re going to lose some of the engagement from creators,” Yurieff says.
Alessandro Bogliari, co-founder and CEO of Influencer Marketing Factory, adds that for this reason, he has always been skeptical of creator funds. “What social media [platforms] sometimes don’t understand is that social media is not just about the features and the money, it’s about the community,” Bogliari says. “It’s about what you can create and how long can you stay there? Of course, some [creators] want to get the easy money and run away, but the others that want to do that as a job, they want to be sure that they can get more out of it, more on a monthly basis than just getting one big payment.”
Brands Will Tap More Creators To Reach Their Audiences
The majority of creators have made and continue to make a living through brand deals.
According to Influencer Marketing Factory, influencer marketing is the primary source of income for 31% of creators.
The good news is that brands are no longer solely concerned with a creator’s number of followers, according to David Anderson, managing director of UTA’s entertainment and culture marketing division.
“It’s “It’s a much more holistic view of who is their audience? What is the engagement? When they do create content and they do post in partnership with a brand, what is their response?”Anderson says. “We’ve seen an evolution to a much more sophisticated evaluation criteria.”
That makes sense given that younger demographics have been slipping out of traditional advertising’s grip. According to a survey from the ad agency Wunderman Thompson, 73 percent of Gen Z Americans want a brand that understands them, and 76 percent want a brand that’s accepting of different identities and experiences, which is precisely where content creators at various levels of reach are bridging the gap.
“We’re going through a period where traditional advertising is becoming harder and harder to reach discrete audiences,” says Joe Kessler, global head of UTA IQ, the agency’s data analytics division. “Here’s an area where brands have an amazing opportunity. Consumers are ready to say if you can help facilitate this relationship and deliver me the kinds of product and access and experience and community that I’m seeking in this, bring it on.”
Furthermore, Apple’s iOS updates, which prioritize consumer privacy by giving users more control over who sees and uses their data, will undoubtedly have an impact on traditional digital marketing. As a result, brands will have a more difficult time reaching out to specific audiences through those channels.
“Influencer marketing is only going to increase next year especially because of the iOS changes,” Yurieff says. “If I’m trying to reach 18-to-34 year old women interested in beauty, I know that I can partner with these influencers.”
Expect More Brands And Bigger Celebrities Becoming Creators
More brands, on the other hand, will become content creators in their own right.
“Every small business sees the need to become a creator,” says Scott Belsky, chief product officer of Adobe. “Whether you’re the local laundromat or pizza shop down the street or massage therapist or hairdresser or whatever the case may be, you now realize that your brand is only as timely and fresh as your content is. And that you need to be represented in your customers or potential customers’s streams on all these social platforms in order even to have a growing business.”
The same is true for celebrities.
“We’re already seeing that to some extent, particularly on Cameo,” UTA’s Kessler says. “But across the board we’re getting questions from our clients now, ‘Tell me about this creator economy thing. How can I participate? How can I build my brand or build my fandom through these new tools?’”
Labor Issues And Burnout Will Need To Be Addressed
Burnout in the creator economy became a hot topic earlier this year. According to a survey, 90 percent of creators experienced burnout, and 71 percent said it caused them to consider quitting. “A lot of the way these platforms are set up is you’re on this hamster wheel and you can’t get off,” Yurieff says.
It’s part of a larger discussion about labor, which Yurieff compares to the gig economy.
“When Uber and Lyft first came out, I remember they were giving huge bonuses to drivers and a lot of people were tapping into the gig economy and all the benefits of it,” she says.
Of course, this shifted into a heavy discussion about labor issues and how to classify app-mediated work. (In California, voters decided through the ballot initiative Proposition 22 that they should be treated as contractors rather than employees, but the California Supreme Court ruled in August that Prop 22 was unconstitutional.)
“We’re gonna start to have more of a labor conversation next year, because I think right now we romanticize the creator economy a little bit,” Yurieff says. “I hear this from creators a lot that they’re like, ‘Everyone thinks this is so easy, and I just film videos at home and it’s so fun and it’s so cool living my dream.’”
NFTS Will Need To Have More Irl Benefits
The excitement surrounding non-fungible tokens (NFTs) has naturally permeated the creator economy in the form of social tokens, which enable creators to sell their own NFTs to fans in exchange for exclusive access and content. The value of a creator’s NFT increases as their star rises. “I see it as a lot of, like, smoke, to be honest,” Bogliari says. “I don’t want to sound like a boomer saying this is just a phase, but it’s truly chaotic as of now. Who has the power are the people with more coins. So at the end of the day, it’s still capitalism on a decentralized land. It’s nothing new. Iit’s still about who has more money.”
Yurieff is more optimistic about NFTs with real-world value, such as gaining access to a meet-and-greet or receiving discounted merchandise. “There will be more applications for that where it’s not just this pure NFT,” she says. “Some of the crypto conversations can be intimidating. And so I think you’ll have early movers and people who are interested in it. And then you’ll have creators who kind of are in a wait-and-see mode with it.”
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