The Creator Economy and the Comprehension Gap
There’s a gap in the understanding about creators and their needs by businesses and society as a whole
Creators need to be good in 3 pillars of the Creator-Market Fit in order to have long, successful careers
Being a creator is attractive and seen as easy, but its areas of difficulty will begin to drive the Creator Economy
We hear the word “creator” a lot these days. More and more people are focused on growing their personal brands, creating businesses around their passions, NFTs (non-fungible tokens) are taking off, and companies are looking for ways to scale their own communications.
Media was decentralized by the internet, and creators making content to become media entities of their own is the outcome.
This “Creator Economy” is only growing.
New tools, platforms, and marketplaces are constantly being built. The vast majority of them focus on 2 areas:
Distribution (ex: TikTok, Substack, ConvertKit)
Monetization (ex: Patreon, Ko-fi, Geniuslink)
Working in marketing at an agency and being somewhat of a creator myself, I’ve been thinking that there may be a slight misunderstanding by many about creators, what they are and what they need.
Let me explain.
Creator-Market Fit
This Creator-Market Fit was shared by Justin Moore, who educates about the business side of being a creator.
Moore states that in order for creators to achieve longterm success, they need a balance of 3 pillars: Psychological, financial and algorithmic strength.
Most creators only have 2 of 3 pillars, and as you can see in the diagram below, a 2-pillar combo has a weakness depending on which two the creator has.
Psychological strength - The ability to have confidence, avoid imposter syndrome, brush off negative feedback, etc.
Financial strength - The ability to monetize and/or support one’s ability to survive off being a creator
Algorithmic strength - The ability to understand various platforms, attention shifts and algorithm changes
So far, creators are assumed to be psychologically strong and attuned to the algorithms on platforms, therefore developing monetization services has been the focus.
The assumption isn’t necessarily wrong. Many creators, especially early ones, are likely relatively strong in those areas and that’s why they’ve been able to pave their own path early, grow an audience and find some success.
It’s great, but as Moore explains, there’s a lack of support in the other areas that if aren’t addressed, will lead many creators to diminishing careers or burnout.
Furthermore, just like anything that becomes trendy and gets glamorized, including entrepreneurship which is essentially what creators do, people will get Shiny Object Syndrome and flock towards it even though they may not actually be a great fit for it.
Part of the reason is that most don’t truly realize what it takes to be a successful creator.
The challenge of being a creator
I see this a lot on public forums like Quora: People assuming creators and influencers don’t do anything besides pose in front of cameras, or people asking if it’s possible to be one if you’re not good looking.
Being a creator is often thought to be an easy job, but it’s actually extremely difficult.
Being someone who takes photos and creates videos for Instagram, YouTube, TikTok, and a slew of other platforms myself…. it can be overwhelming to say the least.
To be successful, people first need to have a balance. Entrepreneur/VC Li Jin came up with her version of a Creator-Market Fit, and states that creators need to address “ABC”:
(A)udience - Who is the content for and do they want it?
(B)usiness model - Is this a sustainable business?
(C)ontent creation - Is making this type of content enjoyable or fulfilling?
The fact is that Creators are often a one-person media company, prOduction studio, and business consultancy.
The majority of creators are doing everything themselves, at least until they can hire help.
For example, here’s what a typical YouTube creator has to be able to do:
Identify trends and topics, and plan videos around them or around an original idea
Understand YouTube’s functions, how to use YouTube Studio, its best practices
Shoot and post-produce videos consistently, sometimes also effectively speaking in the video and/or on camera
Respond to people in comments and engage others
Analyze performance, plan optimizations and implement them
Potentially know how to use the ad platform and how to execute campaigns when needed
Know how to network, research potential collaborations, reach out and negotiate
Maintain mental strength to do this consistently despite setbacks, competition, negative judgement and feedback
And that’s not considering managing other social networks, building a community and monetizing.
So yes, it’s a lot harder than it seems, and it can eventually take a toll on creators. There is a mental and emotional wear and tear on top of the difficulty that hasn’t been fully realized by the masses nor focused on by businesses in the creator economy.
Not only are their financial needs necessary to address, but needs in the psychological pillar will only continue to rise.
What’s next for the creator economy?
Here’s a few possibilities based on what I’ve read and what I’m sensing.
1. Many more creators will continue to emerge
Becoming a creator is an increasingly attractive career option to many. It’s already a top job kids want to do when they grow up in the US and UK, and in Japan as well.
2019 survey of what kids want to be when they grow up - Business Insider
As the friction it has with society’s ability to accept it as a legitimate career continues to fade away and new tools are developed, more will attempt to be one.
Like in my previous blog about the influencer who launched a national DTC burger chain, people are understanding that building awareness means growing opportunities for themselves, and everyone wants that.
NFTs and their potential to more accurately assign credit and deliver payments to creators will strengthen viability.
A sign that we’re moving in this direction is the news saying that even with high unemployment, companies can’t fill positions. Covid has led people to reconsider their lives and how they’re living it. And with “new age” career options in the gig, passion and creator economies, more and more people will stop buying into companies in a middleman economy with weak visions and controlling contracts.
2. Creator Economy startups will grow in the psychological pillar
The focus on distribution, monetization and finance for creator economy startups has left the psychological pillar largely undeveloped. This will change as both creators and competition increase.
Mental health and behavioral health above it are already a rapidly growing space now, so it’d be safe to assume that services focused on creators’ psychological wellbeing in particular will begin to pop up.
3. Next-gen financial support for creators will arise
Areas around cryptocurrency, DeFi (decentralized finance) and the NFT market will continuing to grow, and so will services looking to help creators.
Companies like Collective already exist as an outsourced back office for solopreneurs, and more will be come up to help creators navigate these spaces.
There will likely also be a growing need to address the class split that will increasingly impact creators.
The majority of creators tend to be on the financially stable side, hence the ability to take the risk to be one. As Karol Jan Borowiecki, an economics professor at the University of Southern Denmark said, “One could hypothesize … if my family is well off, and my career doesn’t go as planned, I can fall back on that financial net.”
The balance of who actually can even try to be a creator is already tipped.
Additionally, creator funds and platforms like Pearpop where people bid and take part in challenges to gain shared screentime with TikTok influencers and celebrities tend to benefit the biggest and best creators the most.
This has thought leaders talking about UCI - Universal Creator Income - to address the lower and middle class of creators that will inevitably grow. But that’s a topic for another day and something I’ve yet to truly dive into.
In any case, it’s a very interesting time, and when we talk about creators, influencers, personal brands… something tells me they’re at their infancy.