The age of creator economy is upon us. No longer just happy endorsing other brands, creators and influencers are monetising their huge social media following by launching products—from sandwiches to make-up lines— to reach their audiences directly. The advent of creators has spawned a whole new economy, one that is at a nascent stage in India but looks all set to grow.
Creators—defined by Li Jin, Founder Atelier Ventures, as those who have built an audience on digital platforms—have not only ushered in a new era of storytelling but also commerce. With an audience that sometimes exceeds the population of megacities, they never had it so good. In India, the influencer market is estimated at $ 75-150 million a year compared to the global market size of $1.75 billion, according to digital marketing agency AdLift.
To make sense of key trends in India, we spoke to several creators, influencer management agencies, startups and investors and here is what we found:
1 Creators as D2C brand founders
So far, consumer brands cashed in on influencers or creators endorsing their products and until recently, the line differentiating brand placements and promotions from the creative liberties of influencers was thin.
However, that changed when recently American YouTuber Mr Beast—Jimmy Donaldson—launched the MrBeast Burger chain with restaurateur Robert Earl. It marked the advent of direct-to-customer (D2C) brands. Donaldson sold over a million sandwiches in just two months.
“The key aspect of any new D2C brand is how it is distributed and builds brand value over a sustained period. Having a vast distribution solves for CAC (customer acquisition costs) and with community love, creators have a strong customer base that comes back for more,” says Viraj Sheth, co-founder, Monk Entertainment, Mumbai-based talent management and influencer marketing firm that is managing at least 45 creators.
Closer home, Mumbiker Nikhil, nicknamed YouTube ka Salman Khan, with 3.69 million YouTube subscribers has launched his merchandise, LabelMN, on Shopify.
2 Various facets of monetisation
Today, many social media companies are experimenting with new monetisation models, taking a page from China, the gaming industry and early ad-adverse pioneers like Tinder, Spotify and Venmo.
Saloni Srivastava, Founder of HustlePost Academy, has helped more than 2,000 creators start their businesses. “I treat my business as my startup. My end-goal is to build a sustainable company,” she says. Like Srivastava, many content creators are offering online courses.
Ranveer Allahbadia, one of the earliest creators, has been online for more than six years and has more than 7 million followers. He has a six-module subscription-based course on Graphy on “building a social media empire”. Creators like Sejal Kumar are replacing celebs in brand endorsements and StyleMeUpWithSakshi, a body advocate, creator and model, has her co-branded range with L’Oreal.
Some creators have turned angel investors like Tanmay Bhat and Allahbadia, who have invested in Qoohoo, a platform that helps creators monetise their followers, and Ready Set Jet, an American beauty brand looking to expand in India, respectively.
3 Going C2C
According to Harsh Snehanshu, founder, Yourquote, a mobile app that allows creators to share short stories and text in 15+ languages, “Creator economy is where the creator and consumer are interacting directly and in India, it is still in its infancy. Two to three years down the line, we will have more creators making money through the C2C (creator-to-consumer) model”. YourQuote, which has 2.5 million writers on the platform, aims to cross 10 million by 2023. Around 15,000 creators have started making money from subscribers by publishing books and stories.
Ankur Warikoo, founder nearbuy.com, mentor, angel investor and public speaker, said, “The next decade is going to see the rise of mega influencers, creators. In fact, my prediction is that this decade will see the world's first one-person unicorn emerge!”
He splits them into three categories:
a) Mega creators (video, podcast, newsletters)
b) Mega teachers (how-to guides, cohort-based courses, education)
c) Mega Influencers (entertainment, beauty & wellness, self-help)
He personally wants to create a million entrepreneurs over the next 10 years.
4 The growing creator stack
Creators are at the mercy of media platforms and some even have to pay the platform. Creators are looking for better ways to build an audience. Thus comes the need for a full-stack platform that provides listing, discovery, growth and financing options.
Kevin William David, who is building Creatorstack, a platform to encourage more creators to take control of their growth and become self-sufficient, said, “What Shopify did for small businesses, Creatorstack does for creators—helping creators have a closer connection with fans.”
Content, commerce, culture and community are important to creators and they have several tools to make the most of them. “Creators should consider themselves as entrepreneurs and like any small business, they need a ready business-in-a-box stack that brings all these tools together. We also have a creator fund where we invest in creators,” David said.
Earlier, a creator focussed on content but they were looking at themselves as unicorns, said Vimal Singh Rathore. He is building Qoohoo, a platform empowering creator freedom, funded by Tanmay Bhat, Hugo Amsellem (investor in Creator Economy) and many others.
Other building tools for creators in India include Cre Club, a financial service for creators, and nocolo.co, which helps creators to learn, build and launch their ideas without writing a piece of code.
5 Regulation catching up
Whether it is the audio-chat app Clubhouse or any other platform, regulation is still evolving. Earlier, brands used to push sponsored posts as organic content and to curb this, the Advertising Standards Council of India (ASCI), a self-regulatory body, came up with guidelines about disclosing brand partnerships. These guidelines go live from March 31, 2021. “With creators directly monetising from their audience, there have to be guidelines where if the audience feels cheated, there should be a forum they can take this up to. With many platforms this still does not exist,” said Rahul Singh, Founder Winkl, a company that helps brands and advertisers run fully automated and data-driven influencer marketing campaigns.
ASCI issued the guidelines at the right time as influencer marketing was peaking, said Mohak Narang, Vlogger and content creator. “In my regional world of influencers, I have seen many people falsely promote brands before acquiring correct knowledge, which will come to a standstill. Also, the audience will be able to distinguish between a branded and organic post promptly,” Narang said.
Though ASCI is not a government regulator, these directives come in as a breather for this fast-paced creator space.
a) Creators are still platform-dependent. They get locked out of their accounts. When TikTok got banned in India, creators had to create their own content platforms. Sustained money flow is still restricted to the best of the best. Conversely, only the bigger influencers wield the most influence. This also means there is high pressure to churn out great content. This pressure is creating the next wave of demand and trends allowing micro-influencers to also dominate due to low barriers of entry, no-frills set-up and a bunch of platforms to experiment with.
b)Venture capitalists are still not very active in this space and several creators have themselves become investors.
c) Brands do not renew licenses or contracts in the long run neither do they strategically use creators to co-create products or services.
a) Big creators are becoming bigger. Moving to OTT, spawning more amateurs, becoming bootstrapped founders. YouTuber and Blogger Prajakta Koli landed her first Netflix series and also got to interview Michelle Obama. Creators like Atelier got more funds.
b) Platforms are becoming more creator-dependent. For instance, Twitter Super Follow, Substack, or even Clubhouse need adoption for mass engagement.
c) Clear demarcation between creators, passion economy and influencers.
d) Normalises subscriptions and fan funding. Built-in features ensure fans keep paying to continue to stay in touch with their idols—YouTube superchat feature where fans pay a certain amount every month to their favourite YouTuber for BTS (behind-the-scenes), early looks, etc. Tanmay Bhat’s live streams are another example.
5 Closer fan circles. Fans work with their favourite creators. Co-creating products that would require a more engaged relationship.
6 Creator unions and guidelines on how to work with creators.
Creator space is heating up but remains highly competitive. Only those with high audience engagement and followers will survive. These "big creators" can spawn many smaller creators and work with them, fund them or mentor them and continue to add value to this space. It definitely should go from a side-project kind of space to this is the "only-thing-i-do-and-excel-at" (and make enough money) kind of space. (Varun Choraria, Associate Product Marketer, Vymo Inc, is the co-author of this piece.)