The Creator Economy Intro
Most of what you hear and read about the creator economy is on the side of the creators. Specifically, how to build an audience and how too monetize. Those are important but what if your goal is to build for creators? This guide is a resource for founders, investors, operators and marketers who are building products for creators or building creator programs to help grow their product.
The creator economy is buzzing and that buzz will continue to grow as more Millennials, Gen-Z and the generation that follows seeks to be YouTubers vs. a traditional CEO. Layer this on with remote work and the emergence of new consumer social apps, and platforms that allow individual too monetize their unique talents, and there seems to be no end in sight to the growth of the creator economy.
Anyone can be a creator but everyone isn't a creator.
While that sounds great, the problem arises when defining a creator. What is a creator? The definitions vary greatly, but in simplest terms (with help from Hugo Amsellem) a creator is an individual that builds a product, community, or releases content with a primary goal to grow from an individual contributor into a business entity. Essentially, anyone that doesn't seek permission to scale. Transparently the definition of a creator is relatively vague across the board. Anyone can be a creator but everyone isn't a creator.
- Course Creators
- Community Builders
- Indie Hackers
- TikTok Creators
Separating Creators From Influencers
Defining a creator becomes even more difficult once you incorporate influencers. Influencers are creators; however, not all creators are influencers. Too narrow this definition, creators that reach a certain status/following fall into celebrity territory become celebrities and influencers. Example, MrBeast is a creator, but he's also a celebrity and influencer. An Indie Hacker won't always be an influencer, but they're still a creator.
Studying The Market (How Many Creators Are There?)
Based on data from Signal Fire, their are 2M+ professional creators making content full-time. 46.7M creators fall into the amateur category meaning they make content full-time. We'll dive into the importance and platform differences of amateurs and professional later on, but note that this applies to content creators and not creators such as Shopifyers, indie hackers etc.
Creators Main Pain Points
Creators have two large pain points.
- Discoverability *
Monetization is a cut and dry issue. In order for creators to become full-time creators and grow their business, they need the ability to generate revenue to sustain their lifestyle. If creators can't sustain their lifestyle as a creator, they won't be able to afford or leverage your product.
Monetization Opportunities via Platforms (via Signal Fire)
- Advertising revenue shares
- Sponsored content
- Product placement
- Paid subscriptions
- Digital content sales
- Live and virtual events
- VIP meetups
- Fan Clubs
In the influencer economy (pre creator economy days), a creators revenue was generated via brand partnerships and shoutouts. Now, depending on a creators lifecycle, the shift goes from brand partnerships and shoutouts to ownership. Think NFTs, social media apps (e.g. David Dobrik's Dispo), ghost kitchens (e.g. MrBeast Burger) etc.
Discoverability is more nuanced because in an ideal world the good content will always be discovered. Unfortunately this isn't always the case. We've seen this time and time again as algorithms leave room for bias and the top creators own a majority of all revenue. We also see this with under represented groups (i.e. minorities) that start viral trends but aren't credited with their work (Vox).
We know from Pareto's Law dictates that 20% of creators will receive 80% of revenue. 20% of creators will receive 80% of views/attention. There is no denying this, but with .4%-1% of creators earning a majority of revenue and being discovered (Quartz), we can try to improve these numbers by opening up more opportunities for creators to be discovered. Discoverability is a win for both creators and brands because discoverability opens up the opportunities for both parties to connect with one another.
Building for the Creator Economy & Going To Market
We've defined creators, we've seen the bottoms up TAM analysis from Signal Fire, we've defined creators pain points, and we've seen how creators monetize. Now we can start building.
Identifying Opportunities In The Creator Economy
With the growing popularity of the creator economy, it's been a gold rush for both creators and founders looking to leverage that hype. It begins with a three part framework for identifying Creator Market Opportunities.
Creator Market Opportunity
- Creator pain point you're solving for?
- Creator lifecycle stage
- Where in a creators lifecycle (Creator Lifecycle) are they?
- Founder market fit
- How familiar are you with their platforms and pain points you're solving for?
- Example, if you've never made a video on YouTube or uploaded anything on YouTube, you might not be the right fit for solving a problem YouTubers run into.
Narrowing In On Your Target Creator
Remember founder market fit? This it where helps out. When identifying the niche of creators you're targeting, founder market fit is a necessity. If you're building a solution for writers you should be a writer yourself, but that's just the tip of the iceberg. Here's how too narrow in on your target creator.
Creators rarely refer to themselves as creators
Questions to ask
- What lifecycle stage is your creator in? e.g. attention or trust stage
- What platforms are they on? e.g. TikTok, YouTube, Indie Hackers etc
- How will creators discover your product?
- What communities and forums does your target creator frequent?
- What languages does your target creator use to describe themselves?
- Creators rarely refer to themselves as creators
Building Your Funnel & Acquiring Your First Creators
There isn't one way to build your funnel nor is there on way to acquire your first customers. Your product and business model will dictate the acquisition channels that work best. There are too many scenarios to factor when building out your funnel and acquiring your first users; however, I highlight how other companies have found success.
It All Starts With Community or an audience
In the past the traditional playbook was sales and marketing led. There isn't a one size fits all playbook; however, growth now starts comes via building an audience or building a community and first. When you take the audience building and community route first, you've developed your own distribution and feedback loop for your product. Community led growth combined with product led growth reduces customer acquisition costs, helps improve your product, and when done correctly increases lifetime value.
The Builders Hierarchy In The Creator Economy
- Create a community containing your ideal target customers + your products MVP
- Build an optimal community experience that listens, rewards, and caters to your community
- Share your community member experience publicly. If you've built a strong and engaged community, your members will share your community and product voluntarily.
- Create content that amplifies your product and community experience
Acquiring your first users
There isn't a one size fits all approach to acquiring your first users. The below approaches can be leveraged to help you acquire your first users
- Partnership Network Effects
- Talent/Influencer Agency Acquisition
- Hand to hand outbound
Partnership Network Effects
Strategically partner with creators that have are respected and follow by other creators in your target audience.
- With his co-founders, he enlisted a group of creators — including Pat Flynn at Smart Passive Income and Anne-Laure Le Cunff, who operates a newsletter called Ness Labs — to actively build communities on Circle to prove out their various design and product decisions. - (Tech Crunch)
Cohort Based Courses
- Wes Kao and Gagan Biyani partnered with creators such as Pomp, Lenny, and Li jin to get real time feedback while also tapping into the distribution of each creators audience.
Teaching vs. Not Teaching
Educate users to catch them up to speed on how they can benefit from your product. This isn't traditional education around how to use your product that is often accompanied with onboarding. This education is dependent on your creators lifecycle stage and the pain point you're solving for.
- There were a ton of people intrigued by the idea of ~starting an online course~ who didn't know how to, and frankly were not ready to buy the software.AhaWe pivoted our positioning away from just software to software AND training on launching a course business. - (Ankur Nagpal)
Your business model is dependent on your product, so we won't dive into that here. For help on pricing strategy, look no further than Lenny Rachitsky and Patrick Campbell's deep dive. However, your business model will also shape creator monetization and longterm business growth.
The platforms that prioritize creators win.
Retaining Creators & Building an Internal Creator Program
Acquiring creators is easy. The challenge is retention and competition with incumbents who use payouts as a way to retain creators. Don't focus on the incumbents attempts to buy loyalty. Focus on creating an environment that listens, supports, and elevates creators. The platforms that prioritize creators win. This is why it's essential to build an internal creator program.
Building A Successful Creator Program
A successful creator program has four main components:
- Owns the creator relationship with the top creators platform while maintaining positive sentiment and relationships with creators across the platform.
- Works cross functionally with other departments (marketing, product, operations) to share learnings and insights.
- Oversees a creator strategy helps the business reach key business goals.
Structuring Your Creator Team
Depending your company stage and resources your internal creator team will look like the following:
- Creator Operations & Strategy Lead
- Responsibility: oversees operations and strategy around creators and campaigns. Works cross functionally to ensure creator team is working in tandem with other departments (e.g. core product and growth team).
- Creator Relationship/Partnerships Manager
- Responsibility: maintains relationships and partnerships with creators. Identifies opportunities for collaborations and partnerships and reports learning to operations and strategy lead.
- Creator Product Manager
- Responsibility: works with the relationship manager and creator lead to identify opportunities to improve creator program and creator product experience.
- Can be an existing product manager that works with the core team.
- Creator Producer
- Oversees creator campaigns and works cross-functionally with the marketing team to implement campaigns and ensure campaigns reach goal KPI's.
With your creator program, internal team, and customers acquired, how do you measure success? With a mixture of key business metrics and creator metrics.
Creator Target Audience Fit: The percentage of a creators audience that overlaps with your target audience.
Creator Target Audience Fit
- The percentage of a creators audience that overlaps with your target audience.
- Example: if you partnered with MrBeast, what percentage of MrBeast audience do you believe falls into your target audience.
- Measuring creator target audience fit allows you to prioritize creators that have a likelihood of bringing more creators to your platform.
Creator Market Fit:
- The ability of your product to solve a creators pain point and retain that creator on your platform as an engaged user.
- Creator pain point solve
- Creator lifecycle stage
- Business model
Time to build
I hope you found this resource helpful. As mentioned, this will continue to be updated and refined, including the Creator Economy Database. If you enjoyed this resource or want to get in touch with me, you can shoot me an email or follow me on Twitter.