We have taken more time than usual as we wanted to digest some of the signals we have been tracking and explore emerging trends. In this Future Digest we take a closer look at the emerging Creator Economy. We also explore social commerce expanding beyond Asia, the power of audio-first platforms, the shift towards ethical and sustainable materials and brands getting pulled into political discussions.
Netflix is getting into ultra short content with Netflix Fast Laughs which is now rolling out on iOS, allowing users to watch, react, or share the short clips as well as add the show or movie to a Netflix watchlist.
Vogue Business reports on brands trialing more niche social media such as Triller, Twitch, OnlyFans and Discord. These emerging platforms are less crowded and thus allows for brands to reach their audience more easily. The focus on creators and community, means that brands have an opportunity to create more authentic and deeper connections.
Unsurprisingly, the pandemic has caused the majority of people to spend more time looking at screens. However, after more than a year, screen fatigue is on the rise and people are looking for moments away from their screen. Enter voice. Podcasts continue to grow in popularity and according to MIT the world of gaming might be next. Voice games have evolved from simple choose-your-own-adventure games to more immersive and interactive games.
Clubhouse becomes an influential channel in South Korean politics. Politicians are tapping into the intimacy and instant nature of Clubhouse to connect with citizens, as such creating a new digital version of the town hall.
Last month Allbirds announced a new leather alternative called Plant Leather, which they claim is the world's first 100% natural plant-based leather alternative. The material is compostable, has a carbon impact that is 40 times lower than animal leather and produces 17 times fewer carbon emissions than plastic-based synthetic leather. Meanwhile, Hermes, the luxury house with a 184 year legacy in leather craftsmanship has announced it will release a version of its Victoria bag with Sylvania, which is a leather-like material made from mycelium.
Roblox went public on the New York Stock Exchange and is now valued at $38 billion, which makes it bigger than other gaming brands that have been around for a long time such as Unity, Zynga, Take-Two and even Electronic Arts.
Social media platforms are paying their creators as the battle for content begins. Snapchat pays around $1 million per day to creators and since they rolled out Spotlight (their answer to TikTok) they given out more than $110 million. TikTok has a creator fund of $70 million for European creators and they expect this amount to go up to $300 million in 3 years time. Meanwhile, Clubhouse is trying to lure eager creators by promising creators either brand deals or $5,000 per month. Even Facebook is getting involved as they expand creator monetisation options.
Forbes reports on the Creator Economy, which sits at the intersection of the gig economy ($300BN market forecasted to reach $455BN by 2023, with 40% of the US workforce making at least 40% of their income via gigs and 64% of full-time workers saying they want to do “side hustles”) and the creative industries (generate around $2.25 trillion annual revenue and employ more 15-29 year-olds than any other sectors).
Another vote of confidence for the Creator Economy comes from Microsoft. The technology giant is supposedly in exclusive talks to acquire Discord in an attempt to get its hands on a creator community. “Creation, creation, creation — the next 10 years is going to be as much about creation as it is about consumption and about the community around it.” said Microsoft CEO Satya Nadella.
At the end of last year the Quadrilateral Security Dialogue aka 'The Quad' was revived once again. This time, however, all four parties are in agreement about the purpose of the collaboration - to counter China's influence in Asia.
Last month global fashion brands, but most notably H&M, faced a backlash in China over their stance against sourcing cotton from China’s Xinjiang region. Chinese influencers and celebrities cut ties with the brand and several e-commerce platforms and landlords have dropped H&M.
The rise of ever shorter content is challenging brands to rethink ad formats and their purpose. Channels with short content are crowded media spaces as people consume a lot of short evanescent content. This makes it even harder for brands to stand out. In this environment brands need to focus on shoppable content, creating a direct and frictionless link between content and commerce.
New sustainability regulation and changing consumer preferences are forcing businesses to reconsider the materials they use. One consequence is the replacement of natural leather with ethical plant-based alternatives.
As people seek to balance out their screen time with audio time, audio-first platforms are gaining in popularity and present an opportunity for brands to create more intimate relationships with consumers. From a brand point of view these channels present an opportunity in terms of brand building, marketing, but even in terms of customer service. Now is the time for brands to explore how they will integrate audio in their marketing mix.
In this newsletter, we included many signals of the emerging Creator Economy because we believe this will have a big impact on how brands connect with consumers. One big shift is towards fan communities. While social media like Twitter or Instagram allows for a quick interaction with a brand, new social media platforms such as OnlyFans and Discord allow for brands to really cater to their fans and invest in creating an authentic community. Additionally, these platforms present an opportunity for brands to develop digital only products - think skincare brands selling virtual filters, fashion brands selling unique skins for your avatar, etc.
While the Chinese market is a key market for many global players, continued socio-political tensions make this a particular difficult market to manage for many Western brands. As evidenced by last month's backlash, challenges can arise that pertain to a brand's values and purpose. Looking ahead, brands increasingly will need to be able to navigate around political tensions and deal with a fragmented information landscape. The only brands that will be able to do this are those that manage to create such a brand affinity that the trust in the brand exceeds that of those trying to discredit the brand.