In 2022, the creator economy was valued at over $100 billion, a substantial market share among the 50+ million people worldwide. Furthermore, its growth is just beginning, which is even more impressive.
A recent study showed that children aged 8 to 11 would rather become YouTube stars than astronauts, which is surprising but not uncommon. In this article, we will explore why the creator economy is so appealing and how to leverage it.
Creators: Who Are They and What Do They Do?
Defining creators can be a challenge. Some believe that creators are individuals who earn money online by creating a following and then monetizing it through the sale of digital or traditional products, sponsorships, merchandise, or brand deals.
However, this definition equates creators with influencers, which is not entirely accurate. Influencer is a term that is often used in a derogatory sense, referring to content that lacks substance and relies solely on appearance and glamor.
In contrast, the new breed of creators appeals to a more sophisticated audience. Their followers are not searching for inspirational quotes but rather looking to learn a skill, craft, or consume exceptional content. They prioritize building a business over building a large following.
For example, Charli D’Amelio is considered an influencer, whereas Rand Fishkin is considered a creator.
What Fuels the Creator Economy?
The creator economy has been growing exponentially, attracting everyone from children to big corporations and venture capital funds. The reason behind its popularity is simple: personal brands are gaining more traction than corporate brands because people are seeking human-to-human interactions.
Big corporations are often viewed as the enemy – they pollute, overwork their employees, and avoid paying taxes, among other things. In comparison, human-first brands are perceived as more trustworthy, and as a result, are gaining traction at a rapid pace. Of course, when a creator becomes famous, they may face hate. However, the scrutiny they receive is still significantly less compared to that faced by traditional corporations.
Additionally, the creator economy is supported by various other industries, such as venture capital funds that are investing millions into solutions that support creators. Existing companies are also adapting their products to support creators, with low entry barriers that make it easy to get started without writing any code.
Low Entry Barriers, High Growth Barriers
The low entry barriers of the creator economy, such as being able to start for free, make it even more appealing. However, with low entry barriers come high growth barriers. Only 10% of creators make over $10,000 per year, and very few make a livable wage, which is why many still hold a day job.
As the creator economy expands, the competition will likely become even tougher. Therefore, it is advisable to spend at least three months testing your idea before quitting your job or business to sell digital products.
To join the creator economy, it is essential to assess your skills and marketing abilities. Consider if there is something you could talk about for 30 minutes without any preparation. If so, congratulations, you have found your niche. It does not matter if it seems too small or obscure, as there are individuals earning six figures a year selling crocheting courses.
The next step is to determine the right approach – should you sell courses, e-books, digital downloads, community access, or all of these things? Start with one and then expand.
Leveraging the Creator Economy If your company seeks to collaborate with a creator to boost visibility, there are several options available to you. You could offer them a direct advertising deal, similar to the influencer model, or sponsor their newsletter, or collaborate with them on a campaign of your choice.
When choosing the right creator, it’s crucial to look beyond their numbers. Of course, a large audience implies more people will see your brand, but this is not always the best approach. You need to ensure that there is a suitable fit between your brand and the creator’s.
The first consideration should be audience overlap. Does the creator’s target market align with yours?
Second, consider the level of engagement from their followers. How frequently do they respond to the creator’s posts? Do they provide meaningful comments? Do they encourage lively discussions?
Finally, assess the creator’s trust signals. How successful are they at selling their own products? A high email conversion rate is a good indication of their ability to sell, but it’s important to keep in mind that trust transfers are never 100% guaranteed.
In Conclusion The creator economy is accessible to anyone, but it can be challenging to achieve success, just like climbing the corporate ladder. Without connections, it can be even more challenging.
Regardless of your opinions on creators, it’s essential to recognize that they are here to stay. Some will grow into giants, while others will cater to a niche market – just like any other business.