How many hours per day do you consume content in your mobile phone? Most of us would accept that it has increased since the pandemic. On average, a smartphone user in India spend ~4.6 hours per day consuming content! Yes, that level of digital penetration has enabled a completely new stream of economy based on ‘CONTENT’.
Creator Economy refers to the entire ecosystem of content creators who earn revenue through online social media platforms by developing content, and also includes those creators’ employees, support businesses/freelancers who contribute & engage in the creators’ content supply chain.
A report published by Youtube along with Oxford economics (link here), highlights four ways of economic impact created through this ecosystem:
- Direct Economic Impact includes the income received by the creators through the platforms or the share of ad revenue placed within their content. It also includes the direct jobs created in the process of creating this content.
- Indirect Economic Impact when the creators spend money to produce their content. It could be as simple as travelling costs to highlight a good hill station or sound production support services or employing a creative agency for the visuals or copywriting.
- Induced Economic Impact is created when the members of this content supply chain spend the money they earn through this creator economy. The additional revenue induces them to spend more, thereby contributing to the overall spend/demand for other products/services too.
- Catalytic Economic Impact results when the creators get revenue through offline brand partnerships or in-person engagements outside the platform.
Creators see a real potential for sustainable revenue today, thanks to the growing interest to consume more content and the increased penetration levels of mobile phones. There is an increasing interest in short form video content both locally and globally – starting from fashion, education, skills, food, entertainment and even to motivation.
But it is still difficult for the creator to monetise their content game. Their earnings can vary widely depending on their engagement with their audience. It is an increasing concern to figure out how to monetise better through the platforms and also how to build other revenue channels. They need to convert their fan following to actually pay them for making the content – Easier said than done in reality!
Sources of monetization could be from influencer marketing, building own online businesses/merchandise, paid subscription models for premium content or teach through online classes. A report by Kalaari Capital (read here), highlights that more than 75% of the content creators still depend on brand deals/endorsements for their major revenue. It is indeed a great opportunity to build startups that enable direct monetisation for these creative entrepreneurs. The opportunity is out there and the right ideas are being funded well too!
