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" alt="" title=""/>Social media giant Facebook is paying popular post creators, from fashionistas to comedians to video gamers, $ 1 billion by 2022.
It is the strongest signal so far that Facebook is now recognizing the strategic importance of the “Creator Economy”.
YouTube, TikTok, and Snapchat have fought an increasingly fierce battle to attract people with large fan bases who, in turn, can generate serious advertising revenue.
Last November, photo and video app Snapchat began paying $ 1 million a day to top creators, though payments have since declined. Popular YouTubers have been receiving a portion of the site’s billions in advertising revenue since 2007.
Facebook is comparatively slow to take in. While the website started paying popular video makers in 2017, most vloggers found that YouTube was much more lucrative.
Instagram, which belongs to Facebook, has meanwhile started the careers of many food bloggers and fashion influencers, but only since last year has the app been sharing its advertising income directly with them.
Traditionally, the majority of Insta celebrity revenue comes from product recommendations negotiated directly with brands.
Too late for the influencer party
Joe Gagliese, co-founder of international influencer agency Viral Nation, said it wasn’t surprising that Facebook’s efforts have lagged behind those of the competition.
Founded in 2004, Facebook was already building a hugely lucrative advertising business by the time the full-time internet celebrity phenomenon emerged by the end of the decade. The wooing of influencers is not crucial for his “primary business”, said Gagliese.
But when the creators moved elsewhere, their mostly young followers followed suit, helping make Facebook an irresistibly uncool website in the eyes of Generation Z to hang out on their parents.
Facebook’s user base is actually aging. According to the Digital 2021 report by media companies We Are Social and Hootsuite, the proportion of people over 65 has increased by around a quarter in the past year, almost twice as high as the average.
Meanwhile, Chinese-owned TikTok was the most downloaded app in the world in the first half of 2021.
It has largely overtaken Facebook as the driver of international social media madness, not least during the pandemic when bored millions of its dance videos and cooking trends turned for slight relief.
In this context, Facebook’s $ 1 billion gambit is seen in part as an attempt to regain cultural relevance and curb youth flight.
“The only way for these platforms to keep their relevance to the younger generation is to understand what they’re doing and keep up with the pace of innovation,” said Claudia Cameron, Head of Marketing and Insights at Amsterdam Influencer Agency IMA.
“Creators are a very important part of this equation as they set the tone for what is cool.”
A drop in the ocean?
As young users flock elsewhere from Iran to Brazil, industry insiders say it’s far too early to view Facebook as doomed.
“You shouldn’t underestimate them because they’re so technically powerful,” says Gagliese.
Facebook’s huge income, which brought in $ 84.2 billion in advertising revenue last year, more than some countries’ GDPs, gives it huge funds for innovation.
It is also, despite its relative loss of street faith, still growing with 2.8 billion monthly users worldwide.
Gagliese suggested that Facebook should spend a lot more to lure internet stars from other platforms.
“Unless Facebook leans really hard, I’m talking, ‘well over a billion dollars’ hard, it’s going to be very hard for them to attract all of these new creators,” he said.
Facebook hasn’t outlined detailed plans for the $ 1 billion yet, but Cameron pointed out that much of it will likely get spread via Instagram, which still enjoys a “cool” factor.
That would be good news for TikTok comedian Mwas, who also has a considerable following there.
“I’m going to wait and see,” he said.
(With contributions from agencies)
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