Uncovering the Truth Behind the Creator Economy
By Tom Seest
At WebsiteBloggers, we help website bloggers develop strategies to create content, traffic, and revenue from website blogs based on our experiences and experimentation.
It is no longer an urban legend that the creator economy is on its way out; venture investment remains strong in this space, although not at a level that would displace some of the established industries.
Creators stand at the intersection of niche communities, content creation and brand promotion – they serve as recession-proof channels that rely on their audiences for support.
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The creator economy encompasses more than 50 million independent content creators and curators, community builders like bloggers, social media influencers and videographers as well as finance and software tools designed to assist them monetize and expand. It is the fastest-growing type of small business; one survey revealed that more American kids want to become YouTube stars instead of astronauts when they grow up.
Even with its massive size and popularity, mainstream media coverage of the creator economy has been relatively uninformed. You might read about how booming it is; rarely does one see stories detailing any challenges it might be facing – particularly after economic slowdown hits hard – including advertisers cutting budgets, influencer platforms making layoffs or closing down altogether, venture capital firms becoming less willing to invest in creator economy-related ventures, venture capital firms becoming warier of investing in this space, etc.
Coverage has sometimes been misleading. When discussing the creator economy, for instance, it is common for writers to mistake influencers for small businesses – when, in reality, these two entities are entirely distinct. Influencers are sometimes considered middle class as they generate income through content creation, but that doesn’t make them so; many creators struggle to attain stability where they can leave their day jobs behind and focus solely on creating.
The problem is that creator economies are often mischaracterized as entirely new models of entrepreneurship, promising an end to ad-driven attention-based monetization models. Yet, in reality, most creators still rely heavily on advertising revenue to fund their work – OnlyFans, a platform dedicated to helping creators monetize through direct user support, has reported that only the top one percent of creators earn six-figure incomes.
Shortly put, the creator economy is an incredible and dynamic sector worthy of more coverage; however, we must avoid misleading headlines or generalizations that might mislead us into overlooking an opportunity to invest in this crucial aspect of our economy.
At one time, social media platforms relied on large audiences to draw creators in and then sold ads against their content. Now, however, in an age of the Creator Economy, content creators own their audience while platforms serve only as the means by which to reach them. As such, many creators are opting for product-based and direct-to-consumer models, which place more power back into their hands than relying solely on ads as their main revenue stream.
Influencer marketing or micro-influencers, marketers should embrace this shift by placing creators at the core of their campaigns. Doing so will allow them to connect more authentically and meaningfully with their target audiences while building long-term relationships that generate revenue streams for their brands.
Many of the biggest names in creator economics are already taking this approach to heart; YouTube creators use tools like invideo or Pixlr to edit and monetize videos on-platform, while Instagrammers utilize apps such as Grin or Captivate to grow their following and make money through posts. Beyond all-in-one apps like these, there are also new platforms that enable creators to develop branded products and services of their own from day one and globalize their brand from its inception.
The Creator Economy isn’t going away any time soon; rather, it reflects a growing recognition that creativity plays a vital role in our economies and societies. Creators’ growth as an economic force prompted this evolution in digital space – thus sparking the rise of the Creator Economy as we know it today.
The creator economy is an intricate ecosystem that poses many unique challenges, with 2018 likely being its toughest year yet. Amid recessionary concerns and creator platforms reducing staff or shutting down altogether, venture capital investors may become less willing to invest in this space, yet people remain drawn to creators for inspiration and advice for everything from cooking and parenting advice to beauty and fitness advice.
The creator economy refers to a new wave of content creators, curators, and community builders that are making their content profitable through various online channels such as video platforms such as YouTube, Instagram, and TikTok; website services like WordPress and Squarespace; influencer marketing companies; crowdfunding websites like Patreon; software and apps designed to help creators grow and monetize their audience; as well as professional support services including videographers and makeup artists as well as business managers, accountants and branding consultants.
The rise of the creator economy provides opportunities for growth, creativity, and entrepreneurialism for people with passions and skills they want to turn into revenue streams. It allows individuals from diverse fields of interest to turn their talents into full-time professional creators or even leave their day jobs altogether – but with over 50 million content creators worldwide today, only a small fraction are making a living from their work; those with large audiences that pay for content/services provided have proven particularly successful models for hosting platforms who host these creators.
Platform-driven monetization is not sustainable for creators or their audiences alike; too much power lies with platforms, forcing creators to produce content aimed at increasing profits over serving audience interests. Furthermore, inequality arises within the industry, with popular creators reaping more of its rewards.
Uncertainty remains on how the creator economy will adapt in response to these challenges, yet many creators are already diversifying their income sources and cultivating communities around their content. Yet the economic slowdown may cause some creators to struggle – perhaps leading them down the path toward creator burnout or even regression in their progress.
The creator economy encompasses more than just YouTube influencers; it is an ecosystem of creatives and problem solvers behind every piece of online content you see, from videos, music, designs, and text to production teams that help produce an engaging experience for audiences ranging from videographers and makeup artists to accountants and branding consultants.
There’s no surprise that more people than ever before are striving to become full-time creators, with more searches for “digital creator” occurring every month and “how to become a digital creator” being searched daily on search engines. Furthermore, new apps and tools such as TikTok, Twitch, Heygo, and Squawkbox make creating content much simpler than before.
Although these platforms have grown increasingly popular, creators are finding it challenging to expand their audience and monetize their work. A recent survey identified three of the main obstacles creators face as top challenges: not enough time, no steady revenue stream, and difficulty reaching the target audience. Most creators find investing in marketing and sales tools like email newsletters, podcasting services, or social media management software helpful in meeting these obstacles.
The creator economy may have been oversold, but that doesn’t mean it won’t play an essential part in shaping online content for years to come. Although not for everyone, influencer marketing can provide an effective means of reaching large audiences quickly while turning followers into paying customers when used appropriately – especially useful for marketers looking for fast ways to reach target customers using influencers who can deliver their message efficiently without incurring significant cost or time commitment with traditional multi-media methods.
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