I have previously written about the first part of the creator economy. In this article, I will talk about my personal thoughts and attempts in this field, answering two main questions: "Where to start" and "How to start". I hope to spark discussions with more friends who are interested in this field. (Original article mirror link: https://mirror.xyz/arthurwu.eth/AOWwblqmug5uTD4Qqi5B8SIjk9kxFjnAmdPu094dF0k)
In-depth Explanation of the Creator Economy#
"The creator economy" is a multi-sided ecosystem that includes at least four roles: users, creators, merchants, and platforms. In this field, there are well-known products that focus on the "user" dimension, the "creator" dimension, and the "merchant" dimension. There is no right or wrong choice, only different strategic approaches.
User Dimension#
Products that have survived by focusing on this dimension have become giants in their respective fields. The logic is simple: in the Web2 era, whoever controls the traffic holds the power. When you choose to enter the market from this perspective, the first question you need to answer is: Why would users use your product?
Of course, even if you enter from the "creator" dimension, you still need to answer why creators need to use your product. However, when the target audience switches from "creators" to "users," this question becomes more critical, and you need to think more clearly. The reason is that platforms like TikTok, YouTube, and Toutiao with hundreds of millions of daily active users are already in front of users. They have significant brand advantages and resource synergies, making it impossible for any emerging startup team to bypass them.
Therefore, under this premise, I believe that the solution to "why users would use your product" is basically the same: focus on a single point and expand from there. Only by first breaking through a "point" (e.g., entering a specific content category), going deep vertically, and turning this point into a "line," can you have a chance to survive under the pressure from giants. The strategy of surrounding cities with rural areas is unlikely to succeed.
The above discussion is based on competition at the same level. If the competitive landscape has changed (e.g., due to lower costs, improved mobile performance, increased fragmented time in daily life, and user demand shifting from long videos to short videos), the solutions described above may no longer be applicable.
Creator Dimension#
Products that enter from the creator dimension are mainly tools. I roughly divide this type of product into two categories: those that help creators produce better content and those that help creators earn more money.
If we roughly divide the lifecycle of content into three stages: "content production," "content consumption," and "content monetization," most products that enter from the creator dimension focus on the two ends, while "content consumption" is left to products that enter from the user dimension (note: content consumption is more of a result, and there is also a "content distribution" step before that, which is not discussed here).
For Content Production#
For a creator, it goes without saying that a user-friendly "production tool" is essential. Here, let's not discuss hardware-related products (e.g., Macbook, monitor, keyboard) and only talk about software. Software can also be divided into two categories: one that simply makes it easier for creators to output content (e.g., support for Markdown, beautiful fonts/styles) and one that helps creators structure their content based on their creative goals (note: this function can now be partially replaced by ChatGPT).
Obviously, the second category is more challenging because it not only has tool attributes but also covers the content layer.
For Content Monetization#
I summarize the main needs of creators into two categories:
- First: Making money. In this regard, creators only consider one indicator: ROI (ROI = money earned / cost). As long as you can help them earn more money, and the ratio of this money to the associated costs (e.g., learning to use your product, migration costs, broadcasting costs, etc.) is greater than 1, creators will definitely come. Patreon, OnlyFans, and Substack all belong to this category.
- Second: More targeted traffic. If you can directly help creators filter out the traffic they need, it will also help them monetize more effectively to some extent.
For the majority of creators, "monetization" is the most important factor. Monetization can be divided into two categories: direct monetization at the content level, where users pay for content, and indirect monetization at the personal level, where creators not only benefit from increased traffic but also find more like-minded fans on the platform, forming a closer connection and ultimately gaining more influence.
- Content-level monetization: The basic strategy is to provide more refined monetization tools and reach more users. In this regard, you should not spend too much time thinking about "how to set up an effective strategy that allows creators and users to work perfectly together," as this is unrealistic. Essentially, if you focus on helping creators monetize their content better, the key is the word "content." As long as you do two things well, it is enough: first, content distribution; second, providing monetization tools. Leave the rest to time. As the platform develops with more content and data, the platform can participate in more aspects. Only focusing on the "art" level rules in the early stages will backfire.
- Personal-level monetization: It is impossible to achieve this without a certain foundation of data. A better approach is to help creators achieve content-level monetization first, accumulate data resources from both sides of the platform, and then transition to the personal level.
Merchant Dimension#
While the user and creator dimensions are ToC (business-to-consumer), the merchant dimension is ToB (business-to-business), essentially providing services. Merchants can be classified into two categories: large businesses (with their own traffic, essentially brand owners) and small businesses.
The demands of these two types are completely different. For large businesses, they have their own private traffic, so what they need is how to strengthen the connection between themselves and their private traffic. On the other hand, small businesses see platforms as marketing channels (e.g., some small businesses want to promote their products to creators on the platform) and hope to evolve into large businesses through multi-channel, multi-traffic approaches.
Compared to the two dimensions mentioned above, the user needs in this dimension are the most explicit, making it the simplest for a startup team. However, it is also important to recognize that the ceiling in this dimension is limited.
Conclusion#
- The creator economy is a multi-sided ecosystem, and for a startup, it is necessary to enter from a single side. Based on the team's capabilities and changes in the market environment, you can comprehensively judge which side is the most suitable starting point.
- For user-side entry, focus on single-point breakthroughs and surround cities with rural areas. For creator-side entry, consider how to help creators "earn money" and "targeted traffic." For merchant-side entry, consider the different needs of large businesses and small businesses.
- Difficulty level: users > creators > merchants; Market ceiling: users > creators ≈ merchants
The above are some personal thoughts on the multi-sided entry of the "creator economy." There are two points that are not included: case studies and the similarities and differences in strategies between Web2 and Web3.
I will include case studies related to the "creator economy" in the next article (where I will talk about what project I am currently working on). Imagine a scenario where you search on Google for "I want to find someone who has experience in e-commerce and understands TikTok traffic." Would the output that sorts users who meet your criteria by score satisfy your needs?
As for the similarities and differences between the "creator economy" in Web2 and Web3, I have already discussed them in detail in the previous article. If you consider these two as tools for the success of your project, it is enough to make good use of the advantages of both and discard their shortcomings.
Feel free to reach out to me for any discussions or communication. TG: Arthurwu24, WeChat: arthurwu2020