It’s been another destabilizing year across the board. But the creator economy has surprisingly held strong, even with a looming recession, increasing pressure from lawmakers to ban TikTok in the U.S., and Elon Musk being Elon Musk at Twitter.
According to Influencer Marketing Hub, the creator economy is currently valued at $16.4 billion, a 19% increase from 2021. So will that energy carry over into 2023? In the latest episode of Fast Company’s Creative Control podcast, I spoke with a few experts to get a better understanding of where the creator economy is heading next year.
Authenticity may seem like an overwrought buzzword at this point, but the sentiment still rings true for what audiences are looking for. According to a study from United Talent Agency IQ, the company’s division that focuses on data and digital strategy, one in two U.S. consumers are interested in seeing the process behind creating entertainment.
“This has translated to [audiences’] desire, or even really their demand, for the talent and creators themselves to pull back the curtain on their own life and show a level of raw authenticity that’s previously been unprecedented,” says Stephanie Smith, head of talent strategy at UTA IQ.
Take, for example, BeReal’s success in 2022. The app, which prompts users at a random time during the day to snap a candid photo of themselves and their surroundings, has been around since 2019 but saw 65% of its lifetime downloads, 43.3 million, in 2022, according to Apptopia.
Going into 2023, Smith sees the need for authenticity moving from something that’s “nice to have” in your content to something that’s “necessary.”
“What we’re seeing are these trends bleeding over to the other social media platforms as it becomes an expectation for content and for content creators as a whole,” Smith says.
Over the past few years, micro and even nano creators, that is to say those with a few hundred or thousand followers, began to claim their territory in the creator economy in a meaningful way. As marketers have learned, subscriber and follower counts are important but engagement rates are even more so—and research has shown that creators with smaller followings often have higher engagement rates.
Running parallel with a smaller follower count is often a narrower focus on a topic. And if the internet has proven anything it’s that you can find community around everything.
“That rise of the niche community and subcultures is one of the biggest things we’re gonna see continue to grow and is most important,” Smith says. “With so much out there, it’s not enough to appeal to everyone anymore. You have to appeal to a specific audience in order to move the needle.”
That translates to Mastodon, Geneva, and Discord gaining traction as platforms that facilitate group chats around specific topics. Instead of posting to reach many, Smith sees an emphasis on posting to just a few in 2023. It’s something legacy platforms such as Instagram may have caught wise to with their latest feature, Notes, which allows users to create status updates that their followers reply to via direct messages.
“These platforms that were historically one to many are also leaning into this trend of smaller groups, smaller connections, and not massive reach,” Smith says. “This is indicative of the fact that we’re such a nuanced culture that mass appeal almost doesn’t exist anymore.”
Also pushing against the deluge of mass appeal is the rising need for curation.
According to a UTA IQ study, half of U.S. adults said they feel overwhelmed by the surplus of content on streaming services alone. Add other media to the mix, such as books, podcasts, and social content, and the crisis of choice is compounded. Audiences want to know they’re spending their time wisely, which social media platforms aim to do with algorithmically chosen content. But Smith sees an opportunity for creators to be the human equivalent of an algorithm.
“What we haven’t seen a ton of are creators themselves leaning into the space to provide curated recommendations for an audience that loves them, aligns with their tastes, and wants to be close to them by consuming what they consume,” she says.
Zehra Naqvi, a senior investment associate at VC firm Republic, agrees that this is a white space for creators in 2023. Instead of spotlighting, for example, book or makeup recommendations here and there as part of a brand deal, she sees the possibility of a new group of creators who build their entire presence online solely as curators.
“The media companies that we see now, like Hypebeast or Hypebae or Highsnobiety, I feel like there will at some point be influencers who are tastemakers,” Naqvi says.
We initially saw an appetite for short-form content when Vine reigned supreme in 2013. And TikTok’s dominance over the past three years has shown there’s still high demand. But the sticking point for short-form creators has always been how to monetize their content. YouTube created an industry standard of pre-roll and mid-roll ads, which doesn’t quite translate to one-minute videos. TikTok introduced its new monetization structure Pulse this year and YouTube Shorts will debut one of its own at the start of 2023.
While creators earning ad revenue is always welcome, Madison Long, CEO and cofounder of Clutch, sees an increase in short-form creators selling directly through their content.
This year, e-commerce platforms Klarna and Shopify rolled out programs that connect creators to merchants directly. And Long, whose company also helps facilitate those connections, expects that trend to grow in 2023, particularly against the backdrop of TikTok possibly being banned in the U.S.
“People say, ‘TikTok made me buy this’—you don’t think Amazon wants people to say the same thing? We all see short-form video being an incredible conversion tool for consumerism,” Long says. “I will be really interested to see where these creators go with TikTok’s possible demise. Or even if it’s still around but there are so many more monetization opportunities out there.”
Listen to the full episode of Creative Control to hear predictions on how Twitter could be a more formidable player in the creator economy, what’s top of mind for VC partners, and whether or not business owners should become creators themselves: Apple Podcasts, Spotify, RadioPublic, Google Podcasts, or Stitcher.
By KC Ifeanyi for Fast Company