The Creator Economy | Definition, Growth, Trends and Market Size
One of the most significant changes that we see in the last decade is the rise of The Creator Economy, also known by many as the subset of Passion Economy. There were creators before also who were making a living from their work but it was limited to a few professions like artists, actors, writers etc. and it wasn’t accessible for the masses, where they could follow their passion with a platform where they do not have to get selected or be qualified for the role, if the people consuming the content likes it they are the king and also they are now able to make a living out of it.
By no means I mean to say here that everyone should quit there job and become a content creator but if there is an inclination then there is not time like this right now where there are platforms, audience and you can easily make a career out of this opportunity.
The internet has decentralized the media, the content we consume today is no longer limited to and owned by traditional big media houses and companies. Ordinary people like you and me can now write, photograph, film and create content in a very easy way in the comfort of their homes.
The creator ecosystem in India today is setting new records and we will see the data in sometime to understand how significant this is to so many people who are building a career out of it.
According to INC42, the creator base in India is between 80Mn and 100Mn. It encompasses streams on YouTube, Twitch and other video streaming platforms , the producers and creators on all the OTT platforms, influencers we see on instagram, Snapchat, Facebook and short video apps where we see random videos get huge reach and appreciation. There is a place for all categories of content, from cookery show to fashion styling to beauty hacks.
Indian Market : Apps
In the Indian market short video apps have done outstanding. After the exit of TikTok many apps have come forward and are capturing the market. Some of them are Moj, Josh, MX Takatak and these apps claim to have a user base of 110Mn and 150Mn+ users and that too within 1-2 years of launch. YouTube has taken over a decade to have 425Mn MAU in India.
One of the trends in recent times is that people want to consume short video content. Anything which has appealing visuals, is 15-30 seconds, captures the attention has a large probability to go viral. Many Video Content Creators who are now influencers have leveraged this trend to their benefit. But yes, content has to be good or stand out, without a doubt.
As per a report by the Business Connect India video content creators and YouTubers in India make somewhere between INR1.5Lakh per month to INR15 Lakh per month and some go as high as 2 Cr per month.
When the Pandemic started which is Feb 2020, YouTube declared it saw creator revenue doubling in India between Feb and May 2020.
How big is the Creator Economy worldwide ?
As per Forbes 2021 research, it says, “ Ask a kid today in the U.S. what they want to be when they grow up, the answer is a social media influencer – an answer 3x more popular than astronaut.”
According to Signal Fire Report we see the following numbers
· 50 Million people has joined the creator economy
· 46.7 million creators consider themselves amateur creators
· 2 millions consider themselves as professionals and earn a living out of it, 6 figure earning.
· Sponsored Influencers are worth $ 8 Billions
History Of The Creator’s Economy
There are many layers to the evolution of the creator’s economy.
1. Emergence of Media Platforms : Late 2000s witnessed emergence of Facebook, YouTube, Instagram etc. and then recently Snapchat, Twitter, TikTok etc. It took the power of content creation and distribution from large media houses and put the power into hands of the common man within the comfort of their homes. What was required was a good camera phone, a network and brilliant content.
2. Monetizing Influencer Reach : Companies quickly recognized the power of the influencers reach and they started collaborating with them to reach to maximum audience. These companies started monetizing the content creator’s and in turn it was a win win as these content creators started making money as well.
3. Creators As Business : This is the place where we are today. Now creators are starting their own business platforms diverting the followers from social media to their apps, websites and monetizing the opportunity. Some creators are also building brands which are getting the traction through their social media platforms.
The biggest trend seen is that creators now have multiple revenue streams and they are being funded by their own fans as well.
Creator Economy A Subset Of Passion Economy
Creator Economy is a subset of passion economy where people can now follow their passion, create content and still make a living without having to look for jobs and the constant struggle to fit in. The best part is you get to do what you love the most and still make a living out of it. The company ahs launched a $100 Mn YouTube Shorts Fund as well.
Creator Economy For Indian Women
Especially, in a country such as India, through the creator economy now women have got immense opportunities to showcase their talent to the whole world in the comfort of their homes. Many women after marriage and kids had to give up their passion but now this has changed a big time. Women have opened Cooking Channels, Fashion Channels, Personal Grooming Channels etc. through many online content platforms and this is the real empowerment. Their content drives the popularity of the channel and through this they are able to even make a living out of it.
Creator Economy And The Pandemic
The pandemic brought about a huge shift where everything looked uncertain but it has only strengthened and reassured that creator economy has a significance. Vast unemployment due to lockdown created more opportunities for people to work from home but still make a living even after they lost jobs. Some people out of boredom started on the path of passion but soon realized this could be their calling. Thus pandemic further boosted this economy to next level.
Now let’s dive a little deeper to explore more about the Creator’s Economy
The D2C Wave
The direct to consumer brands are seeing huge impact and growth with the social media influencers and the content creators. Example we have is SUGAR which has grown to 100 Cr+ in sales just banking on the social media and creators economy. One of the key to the cosmetic brand’s success has been its use of influencer marketing and social media hype generation with more than 1.5 Mn followers on instagram and over 300Mn impressions across all social media channels.
Ease Of Living Ease of Access
There is no more the need of coming to the metros to take up a job, if you have figured out your content strategy and medium. Many people in tier 2 and tier 3 cities are now banking on the creator’s economy. Women are the ones to befit the most from this. Many women after marriage and kids have to give up on their jobs in India and to restart again with taking up jobs which they might not find in their own cities, to take a shift to another city is impossible. These platforms have empowered them to do what they love, share it with the world and also earn money and be independent.
All The Way From Silicon Valley : A Global Perspective
Silicon valley has a lot of buzz too when it comes to the Creator’s Economy. The boom which has come in the creator’s economy has brought about a new interest amongst the venture capitalists who for years thought there was little to not point investing in social startups with the likes of facebook snapchat instagram etc.sucking all air out of the market.
The technology nnews site The Information estimates that Venture capital Firms have invested $2Billion into 50 Creator focused startups so far this year in 2020-2021 in Silicon valley alone.
Some of the investments made in silicon Valley
· Seven Seven Six Venture firm and Bessemer Venture Partners announced $16 million investment in Pearpop
· Andreessen Horowitz invested in Stir, valuing the company at $100 million
· Spark Capital invested $20 million in Dispo
· Stalwart Benchmark led an investment of $20 million in Poparazzi
· Clubhouse raised $200 million in a funding round led by Andreessen Horowitz , now valued at $4 Billion.
After Clubhouse was launched Spotify and Twitter announced the launch of Greenroom and Twitter spaces respectively which shows how much competition there is in the creator’s economy space.
How can we see investors leveraging Creator’s Economy
Podcasts and Video content to educate the masses was already there but now Investors often do rooms with their venture fund associates on clubhouse where they educate and even listen to pitches which is a great way to network with the founders globally.
Venture Capital Firm SignalFire has found top 3 trends in the creator economy :
1. Creators are moving their die hard fans away from all the social media networks and on to their own apps, website and monetization tools
2. Creators are becoming founders and are building teams and re assembling tools to help them start businesses while they focus on their art.
3. Creators are now gaining power in the media ecosystem because the followers seek to connect with the influencers and not with faceless publishers/companies.
The ways content creators can earn money by using various platforms are as follows :
· Advertising revenue
· Fan Clubs
· Live Events/ Virtual Events
· Merchandise Giveaways
· Sale of Digital Content
· Paid Subscriptions
· Product Placement
· Sponsored Content
What has led to the fast growth of creator’s economy ?
· A societal shift in consciousness, people don’t want to work 9-5 in jobs, it gives them freedom to choose and also live their passion.
· Better cameras in phones and better network have now empowered the masses to put their content out to the world.
· COVID has further given this a huge push with people losing jobs and more people working form home, not wanting to relocate again.
Creator’s Economy Closer Deeper Look : by Hurratul Maleka Taj
There are few points that are critical to Creator’s economy
1. Lack of entry barrier means the competition is always very high and if in the same space some other player grabs the audience attention it can lead to depletion of engagement and distraction. The content creators have to constantly evolve and compete if they want to stay relevant.
2. This is also a challenge for the content platform creators, the companies giving platform to these content creators to create algorithms that give young talent to go viral with their content, making sure that it doesn’t disrupt the existing ones. This is a challenge to give everyone their place and an opportunity to be seen and earn and grow and shine. How do they make it happen that is upto them, but that is going to be the defining factor to make people stay.This is a challenge as well a boon for the content platforms where the competition keeps their paid advertisement generated money flow going but also puts a risk that content creators or brands might switch to other channels.
3. The ease of creating content on the app itself is a significant factor. As of now we see that Instagram has given filters and various GIFs and stickers but still the video editing has to be done on other apps and posted on the social media platforms. Imagine a scenario, if they also have editing options here, which makes it easy for content creators to edit in a better way. We do have limited editing options now also but what if they became more advanced. What if the content creators could do everything on a single application from shoot to editing to final posting.
4. The other important thing is that these 15-30 second short videos are relevant for a short window frame and their reach in that given time is what brings in the exponential growth on the channel. Unlike the long video logs or the blogs which has knowledge and stay relevant for a large time frame, these are short lived but they create the impact to drive the purpose, which could be anything, form becoming an influencer to driving sales. Thus, these short videos are the ones trending right now where the attention span of audience is short but if you are able to catch it, you can leverage a far wider reach than those who create lengthy information loaded videos.
5. This brings me to my next point that these days there is a concept of funnel. You have o catch the attention of your audience within the short time frame, so much so that they enrolled to sign up for the funnel that the action button takes them too. Once they get into the funnel it depends on you (the brand/influencer) how you convert them.
6. We must not forget that when such large amount of content is being put out there, there are chances that for commercial ads people will endorse products/services which they do not know much about but are bring paid for and for a followership that big and strong it can jeopardize public interest at large if there is a discrepancy between what is being claimed and what there is. Also strong opinions can have an impact on masses and thus the filtration and censorship is also important.
What's coming next ?
According to me, in India there is a huge audience in the vernacular medium segment which is untapped and apps that focus on content in vernacular languages, focussed and targeted to their needs and requirements can be make huge numbers both on audience and on business side.
If you are a person who wants to be a content creator, right now is the time where brilliant content can do wonders and can bring in not just huge followers and money but also make a strong solid base to start new businesses supported with the traction on your channel.