What is the ‘creator economy’?
Traditionally, most entertainment and content was only available on TV, in magazines, and on the radio. But once the internet arrived, along with social media platforms, users were able to find their online communities and engage in content that they preferred. But have you ever thought about what effects this change in content availability has had? The plethora of content available on the internet has created the ‘creator economy’. Let’s explore it!
The creator economy
The creator economy functions to create and provide content for all types of people with all types of interests. No matter how unpopular or obscure your interests are, you are likely to find content targeted toward you.
You can define the creator economy as an economic system that was brought about and is currently sustained by independent content creators. These content creators reach their audience as well as businesses via the internet and social media. The content creators within the economy create content such as digital copy, podcasts, music, videos, etc. To make a profit out of this, the content creators will share their content on platforms that are sponsored by ads, they would form a partnership with a brand or would charge fees to gain access to their content.
The structure of the creator economy
The creator economy consists of content creators, the audience, online platforms, brands, and tools.
- Content Creators: As explained, content creators create and distribute content for a specific target market to make a profit. They can be regarded as influencers. An influencer is someone who is able to sway the buying decisions of an audience because of their voice.
- Audience: The audience consumes the content and often demands it. Sometimes they pay for the content, sometimes they simply engage with it.
- Online Platforms: These are spaces that allow content creation, allow the distribution of content, allow audiences to consume the content, and allow the monetisation of it. As implied, these online platforms are used by content creators and the audience. Examples of these platforms are Instagram and TikTok.
- Brands: Brands use the ‘creator economy’ to target their preferred audience. If brands chose to simply market their product or service on the content creator’s platform, it would likely show less of a return. To properly utilise the creator economy, brands partner with a content creator who then creates content that incorporates the brand. This allows for a more natural increase in brand awareness.
- Tools: There are different types of resources on the internet that allow content creators to create content and determine if their strategies are successful. An example of a tool that assists in creating content is Canva, which lets you create visuals for social media. An example of a tool that assists you in tracking your engagement, for example, would be Onalytica.
Business models that operate in the creator economy
Depending on the platform used and the content being created, there are different types of business models that content creators can profit from. The most popular business models are the Platform Revenue Sharing Model, the Affiliate Marketing Model, and the Product Placement Model.
The Platform Revenue Sharing Model is commonly used on YouTube and Facebook where content creators gain a percentage of the ad revenue of their content. Seeing that these content creators receive a percentage depending on ad revenue, more followers means more money. Content creators with a large following are able to generate large profits off this model, but those with smaller followings may not.
The Affiliate Marketing Model is when content creators receive a commission for each sale made or customer gained due to their referral. Content creators do not only create a profit, but they also become a trusted voice within their field. Brands are able to track customers gained due to content creators when the content creators use specialised links and coupons that are personalised for their audience.
The Product Placement Model is when content creators are paid by brands to incorporate their products or services into the content they produce. The brand is often incorporated through mentions and referrals to their social media platforms or website.
The creator economy has shown that there is a space for every single person, and this means there are a wide range of opportunities. If you are interested in becoming a content creator give it a try! The field you’re interested in exploring may be filled with content creators, but if you are able to bring something new and fresh, you are sure to make a success of your content creation.