The creator economy is thriving exponentially; a 2022 study from Adobe estimated an increase in the number of creators from 165 to 303 million over the last two years, almost 4% of the global population! The market itself was estimated at $16.4 billion in 2022, a growth of more than 860% since 2016. And it’s only getting bigger: The Influencer Marketing Benchmark Report 2023 predicted it would grow by another 29% to $21.1 billion in 2023.
Why such a boom?
Internet growth and its accessibility, as well as innovation expansion, have made it more convenient for people to create, distribute, and sell content digitally. Progressive improvements in user-friendly digital platforms have shifted media consumption habits; people simultaneously create and receive real-time news, diverse personalized entertainment, and interactive content on a cheaper and larger scale digitally, which traditional media could not offer.
The paradigm shift in generations has also reevaluated our relationships with technology. While baby boomers and Gen X value simplicity and comfort in life with practical technology use, millennials and Gen Z—projected to make up over 75% of the workforce by 2025—have grown up fully immersed in technology and the internet in a highly interconnected and globalized world, with a stronger desire for purposeful living.
This younger generation is more inclined to express their opinions, passions, skills, and talents digitally, as well as seek inspiration and motivation from other creators in finding their purpose. As a result of global social sharing, the rise of creator culture was born. One way of looking at it is as part of a broader shift from creativity as a by-product of economic growth to creativity as a driving force of the economy.
How are creators shaking things up and giving brands a new game plan?
Advertisements are often linked to consumers’ desired lifestyles, and in recent years to a purpose or social cause. This creates an emotional connection with consumers and brings their hearts and minds together. The creator economy has opened a new advertising channel for brands and changed the marketing landscape as brand partnerships fit perfectly into the creator economy ecosystem that revolves around creators, audiences, and digital platforms.
Brands with strong positioning and consumer personas offer negotiated partnership opportunities to creators, who in return offer a strong commitment to a cause, an aspirational lifestyle, interactive and authentic communication, and ownership of a niche community. This partnership can include product mentions and placement, sponsored content, and more. As creators exert a strong influence on their communities, brands leverage them to communicate their positioning to their targeted audience. Ultimately, brands convert the audience for advocacy and repeat purchases.
What does success look like?
In comparison to traditional media such as television, newspaper, and magazines, the metrics of success on the digital platform have evolved over the past years to accurately determine the return on investment for brand partnerships with creators. This involves calculating how many targeted consumers have been reached and converted for every dollar spent on these partnerships. Some common key performance indicators are cost per impression, cost per engagement, cost per click, cost per lead, and return on ad spends. The creator economy has modernized the marketing industry with cost-effective and scalable accuracy.
What about traditional media?
Digital media has grown in popularity, but despite this, traditional media including television, radio, and print still play a significant role in engaging with a broader audience with a strong presence in gaining public awareness. Brands with a distinctive brand image that appeals to the younger audience are leveraging marketing spend more significantly on digital media to specifically target millennials and Gen Z.
But for reaching a larger audience, which brands categorize as the consumption pool, traditional media remains a valuable tool to keep the brand top of mind. As much as the internet has disrupted traditional advertising, both traditional and new media play an essential role in the marketing landscape.
“Using content creators for brand promotion provides an unlimited number of perspectives and audiences. This provides an opportunity for an authentic, community-based connection with audiences. Because younger audiences expect and accept brand promotion as part of their entertainment, brands can more easily customize and connect with them. This strategy also comes with comparatively low risk and cost to switch up if needed. Through content creators, brands can engage consumers in a more intimate and personalized dialogue, like a cool kid who has a group of peers who follow their lead. Content creators have an emulative relationship with their followers, which feels more truthful than just being an advert on TV. While traditional media can reach older audiences and provide wider fame, a well-designed campaign doesn’t have to be either/or. By reinforcing premium messaging and reaching younger audiences, content-based strategies can complement traditional media. As a result, brands can reach a broader audience with a more relevant message.” – Talula White, founder and CEO of Sekforde Drinks Ltd.
What is the role of negotiation in the digital landscape?
A strong partnership is essential between brands and creators to ensure sustainability in the creator economy. The five Ps in negotiation planning are the key elements for a win-win situation:
- Prospect: Brands need to understand the creators. Are they a good match when it comes to identity, reputation, and authenticity?
- Predict: Brands and creators assess values, investigating the brand’s business scale and creators’ audience reach.
- Power: Both parties evaluate bargaining strengths.
- Plot: Outline trading variables and their importance to each party.
- Position: Plan assertive moves, know each party’s breakpoints, and aim for long-term cooperation.
About the Author: Emily Chee is Marketing Manager at The Gap Partnership and a seasoned marketer with extensive B2C and B2B experience. Her expertise in brand management, product launches, and marketing strategy has earned multiple industry recognitions, including The MARKies Awards, Nielsen’s Top Innovation, and BESTSELLER – RUNDSCHAU für den Lebensmittelhandel. Emily consistently drives impactful results through her dynamic approach to marketing.
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