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There’s an old truism that if you do what you love, the money will follow. For some influencers, this has proven true; the rise of platforms such as YouTube, Instagram, Twitch and TikTok has empowered creatives to share what they love with millions of people and get paid to do so.
Consider a critical role: By sharing their home game online, six voice actors were able to transform Dungeons & Dragons from a niche interest into a mainstream sensation. Even those with weird hobbies can make a living on social media if they get enough exposure.
The core philosophy of influencer culture is that if your content is engaging enough, you should be able to make a living creating it. According to a 2020 MediaKix report, up to 42 million influencers are currently active on TikTok, Instagram and YouTube. But while creators’ interests are nearly endless, their opportunities for financial success are not.
Monetization generates limited revenue, and only for certain creations
There’s no doubt that influencers with an established following can make a good living. According to CNBC estimates, YouTubers who have 1,000 subscribers and generate 24 million views per year can earn around $100,000. However, monetization is not a given for new creators; users must have at least 1,000 subscribers and accumulate 4,000 “valid public viewing hours” over a year just to to qualify for the YouTube Partner Program (PPY).
Plus, creating the kind of high-quality content that attracts subscribers takes time and effort — and when an aspiring influencer chooses to create content full-time, they lose the financial safety net that a new job at five would otherwise have provided. Those who are eligible for monetization may still need to supplement their revenue to stay afloat if their ad revenue isn’t generating enough revenue.
Some creators might try to bridge the funding gap by offering monthly subscription options to their audience through platforms like Patreon. However, many mid-tier influencers are turning to a more lucrative, albeit risky, option: brand partnerships.
Brand partnerships can provide essential financial support – and undermine authenticity
Today, influencer marketing is a $13.8 billion industry. In theory, it’s a perfect match – brands want to target audiences with specific interests, and influencers can offer a platform to reach them.
But sometimes selling airtime can seem to viewers like selling outside.
“By using their own social media channels, influencers often give the impression that they have a personal rather than a commercial relationship with the brand and products they are promoting,” researchers explained in a study published in the Journal of Interactive Marketing earlier this year.
The study’s writers noted that this trend could pose a problem for smaller content creators, as consumers don’t expect them to have the same corporate connections as a mega-influencer – say a fame – might have.
“If nano-influencers disclose a paid relationship, consumers may feel cheated because they expected the post to be a personal recommendation,” they explained. “Thus, consumer expectations are negatively rejected, which decreases the trustworthiness of that post and subsequently produces lower brand and influencer ratings.”
Brand partnerships also have ethical implications. Popular YouTube mixologist Greg Titian addressed this question last December, when he posted a video review of two automated drink machines.
“Bartesian has been contacting me for a long time to do something about sponsorship,” Titian said. “And I didn’t answer, like… I can’t use your machine in a sponsored thing because I have to review it, and I can’t review it if you give it to me for free or pay me to examine it. I had to pay for it with my own money.
There’s no doubt that brand partnerships offer an invaluable funding option for full-time creators. However, taking the wrong brand – or simply presenting too much brands – can backfire if viewers begin to view content as too commercial or inauthentic compared to the experience they expect.
But how can influencers maintain their authenticity without breaking the bank? A lucky few might go viral and rack up enough viewers to make a living through monetization; however, most will need to balance promotion and genuine content to stay afloat. The risk of alienation from the public is perpetual and unavoidable; a poorly managed post could permanently drive away valuable viewers.
But what if content creators not only had the means to embrace authenticity, but also the ability to get paid to stay loyal to their audience? SocialFi – a cryptocurrency-powered social network – may just give content creators the opportunity they need to thrive without relying on brand partnerships.
SocialFi could allow creators to deliver authentic content
SocialFi puts a DeFi spin on social media engagement. On encrypted social networks, users can earn tokens by creating or interacting with content; Over time, these social activities can translate into substantial real-world income if a creator is popular enough.
Although SocialFi is a relatively new concept, it doesn’t seem out of place – in fact, the idea represents a natural next step in the advancement of the platform. Rather than asking consumers to learn new behaviors, SocialFi apps would simply monetize the activities users already do every day.
The movement has already begun; last fall, Twitter started allowing bitcoin tips for creators. Around the same time, Binance Smart Chain announced that SocialFi would be an important area of focus for its $500 million investment program. Solana Ventures, an incubator focused on developing innovative applications based on Solana, has also shared plans to award $100 million in funding to Web3 social startups.
The importance of these advancements for content creators cannot be underestimated. If SocialFi achieves mass adoption, creators could leave ethically difficult corporate partnerships behind and rely on their audiences for funding.
Audiences, for their part, could take a more active role in allowing their favorite creatives to deliver authentic content. Consumers are undeniably willing to do so – just look at Patreon’s latest turnout numbers. Today, the creator funding platform hosts over 6 million active subscribers who have collectively paid out over $2 billion to creators.
Or consider viral examples like author Brandon Sanderson’s 2022 Kickstarter. In just 35 minutes, Sanderson’s campaign to fund four new books surpassed its goal of $1 million. As of this writing, the campaign has surpassed nearly $35 million.
The reality is that if people want specific content, they will do what they can to help the creator produce it. SocialFi could provide digital creatives with the means to deliver content without risking disengaging audiences by relying on ads and partnerships. It’s the next step in the evolution of social media: SocialFi can ensure that, for creators who share their interests with the world, money will be to follow.
Sakina Arsiwala is co-founder of Taki.
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