The creator economy has been on my mind lately as it is something close to my heart having to have built a business in it. The term wasn’t coined when I first started. It has been more than a decade and it is amazing to see how the technology has matured. I wanted to take a pause and look back at how it all happened – these were the signposts I could plant:
User generated content -> Social media -> Influencers -> Creator economy
User generated content – The internet allowed everyone in the world to be connected as long as the infrastructure allows. And it was difficult to scale if a tech company has to create content internally. The idea was to serve as a platform and allow users to contribute content for free. In exchange, intangible rewards such as social connection and recognition were accorded. This kept users coming back and continue to give. Some of the early platforms were Blogger (blogspot), WordPress, YouTube and Wikipedia. I remember myself willingly and was pretty motivated to blog on Blogger back in 2007. It was even exciting to see that I could get my work ‘published’ on the internet – it allowed individual expression and the feeling was liberating. The significant discovery was that individuals were willing to contribute content without getting remunerated financially.
Social media – The user generation feature was eventually accepted as a norm and the buzzword became social media. People were going online en masse and interacting in the digital space as internet became cheaper and more accessible. We can have people physically in a room but communicating through their devices. We catch up with our friends and families through their updates that appear on our news feed instead of having real conversations. You are considered a recluse if you are not on social media. Soon, we found ourselves doing other activities on social media – play games, read breaking news, find others with similar interests, get recommendations etc. Companies were also pressured to create a social presence to stay connected with prospects and customers. Facebook is the social media king and even Google’s attempt with Google+ could not dethrone it (YouTube has a social element even though it was focused on video). Twitter, Instagram, Snap, Pinterest, LinkedIn and others came along. We now live half of our lives online.
Influencers – Social media cannot escape the Pareto Principle or the power law – majority of the users are consumers of content while the minority are producers. A handful of producers become the superstars while most of the producers get minuscule number of followers. We call these superstars, influencers. They are not scouted and trained by talent agencies. They do not need permission from the studios or media companies to appear in front of an audience. They were chosen by popularity. The number of platforms has exploded and we can find top influencers in every one of them, and in every niche. We can have a boy (Ryan) raking in more than $20m a year by making YouTube videos to entice kids to buy toys. Even in China, a grown man (Li Jiaqi) can sell lipsticks more than anyone else via live streaming on an ecommerce platform. There are influencers on Instagram, Snap, Twitter, LinkedIn, Douyin / Tik Tok, Kuaishou, Xiaohongshu and many more. Many have attained the celebrity status and made millions, inspiring the younger generation to want to be influencers.
Creator economy – We have progressed a lot since the days where individuals were contributing content without being paid. There is now an economy centred at the creators. It has also gone beyond influencers taking advertising dollars. There are creators who can sell courses (Udemy / Teachable / Thinkific), sell newsletters (Substack), sell digital art (NFTs), sell game items (Roblox), get donations (Patreon), sell entertainment (Twitch / Douyu / Huya), sell crafts (Etsy / Shopify), sell arousal (OnlyFans) and what not. Companies are creating softwares and services to help creators manage their businesses. Our ancestors were once artisans, selling their craft and wares as sole proprietors until industrialisation came, and most went to the factories to churn out standardised products. We have come one full circle and now the creator economy is about the individuals again. The only difference is that the individual has a lot more reach today with the internet instead of just a local market. But that also means that the power law will be more pronounced – there’s hyper competition and it gets much harder to make a living in this new economy while the winners take in obscene amount of money.