The Creator Economy is Exploding
The growth of social media savvy creators is changing the media landscape
The “creator economy” - the platforms and tools that allow creative individuals to share content, build an audience and make money - is rocking. It is now worth over $100 billion, which means I have to stop telling my teens off for twisting on Tiktok!
The creators are fuelled by social media followers and these followers are fuelling creators - indirectly and even directly.
Creators’ cultural impact is surpassing that of traditional media - proving that we all want to be Kim Kardashian. These creative types include YouTube sensations, Twitch hosts, Tiktok dancers and a range of social media savvy presenters, writers, musicians and artists.
And they have an audience to die for.
There are over 6 billion people who use a smartphone device, according to Statista, and almost 4 billion of them are active on a social media platform. Almost anyone can create content and post it for the world to see. Pretty much anyone other than Donald Trump. Mind you, he’s about to start a Truth Social for that!
Ryan’s World, a children’s channel on YouTube that features videos of toys being “unboxed”, has over 30 million subscribers, and its most popular video has had more than 2 billion views. Unfortunately, though, it seems Ryan is running out of boxes because there aren’t enough truckers about.
Less than a million people watch CNN during prime time.
According to Signalfire there are roughly 2 million professional individual creators making content full-time and we are approaching 50 million amateur individual creators monetising content creation part-time.
Of the 2 million professional creators a million are on YouTube with more than 10,000 subscribers, 500,000 on Instagram with over 100,000 followers and around 300,000 are on Twitch as either a ‘partner’ or ‘affiliate’. There are also a couple of hundred thousand writers, musicians, artists and podcasters on other niche platforms.
Creators have become the fastest growing type of small business. A recent survey found that more American kids want to be a YouTube star than an astronaut when they grow up. Which is presumably why Richard Branson keeps selling Virgin Galactic stock.
The big money is there for creators and the possibilities just keep expanding. There might even be a case for updating the school curriculum so that it focuses on twerking, gaming, editorial photography-of-yourself and emoji shorthand writing. Who needs maths, science or history?
Psychology on the other hand is in for a boost with 50 million creators banging their heads against a proverbial wall trying to squeeze out yet another Instagram smirk.
These content creators are becoming experts at reaching the most niche groups, learning new tricks to become relatable and, when they gain a following, dictating current and future trends. They mine the grass roots like a shale gas developer. That way the big corporations don’t have to.
Apparently the latest trends in the creator economy include:
Creators moving their top fans off social networks and on to their own websites, apps, and monetisation systems
Creators becoming founders, building their teams and assembling tools to help them start businesses while focusing on their art
Creators gaining power in the media ecosystem as fans look to connect with individual personalities rather than faceless publishers.
Creators are increasingly working to diversify their revenues and getting funded directly by their fans. Which is why Mark Zuckerberg wants to build a new metaverse beyond Mars where no one ditches his apps any more.
Creators are transitioning from being paid by platforms like YouTube, with a share of ad revenues for bringing their audience, to being paid by brand sponsors on Instagram and Snapchat, to being paid directly by fans via patronage, tipping or ecommerce - in exchange for entertainment and community beyond the platforms. And who said that YouTube would go on for ever.
The creator economy has been built in three phases. First saw the development and adoption of the foundational social media platforms such as YouTube, Instagram and Twitter - Tiktok and Twitch becoming more recent sensations.
The second phase saw the development of a new industry around monetisation models, tools and suppliers.
The third phase of the creator economy has seen creators develop businesses with all the necessary management, scaling and team building required. As they have developed mini-media companies they have sought business apps, suppliers and wider diversification of revenues - which now include courses, webinars, speaking, gigs, newsletters, fan clubs and merchandising. All from little Jonny playing Minecraft out loud!
There are a growing number of platforms and tools for creators. Most of them are quite generic but that will change. They tend to focus on content creation services such as photo and music editing tools, fan marketing and audience CRM, influencer marketing tools and funding systems.
The creator economy market map of suppliers and software providers is starting to fill out. Some of the tool providers for this burgeoning new industry are growing quite large - including Splice, Kajabi, Cameo and Patreon.
The money obviously lies with the 2 million odd professional creators. And it seems that the next wave of platforms will be those focused on specific creator types, with a vertical stack of software that feels more like an integrated business app tailored for the creator economy and individual or small business users.
Like SAP supported manufacturing businesses with a sector focused suite, tomorrow’s app vendors will deliver a stack of software that will give a specific type of creator everything they need to build their content across dedicated platforms, then market, measure and monetise it. The 3 M’s of ‘cha-ching’!
Tomorrow’s bands might have a Patreon type software system that will not just help them to develop their fan base and monetise it directly, but will suck their content out of a dedicated media platform while auto-marketing to new fans directly. It could also manage these fans using artificial intelligence while supplying them with bespoke merchandise, all while pumping out financial statements in real time.
Tomorrow’s creators will look for solutions tailored to their various business needs, whether in marketing, copyright expertise, investing, operations, community-building, or product launches. The companies that recognise this trend and build tools for a particular swath of creators could find significant growth opportunities.
This will help creators to stay focused on what they are good at - mostly curating compelling content and whipping up their audience. Let software and advisers worry about the operational stuff so Jemma can keep beating Jonny on Peppa Pig - live at your nearest iPhone.
Thanks for reading Letts Journal! Subscribe for free to receive new posts and support our work.
Keep up to date with the Letts Journal’s latest news stories and updates on twitter.
What is the Creator Economy, CB Insights