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In 2020, we launched our first annual meeting: Now, New, Next. In this virtual series, we worked through the growing complexities of a shifting world with game-changers in all fields. Now, we’re rolling out the info here for anyone who couldn’t make it. Today we’re talking about how influencers become entrepreneurs who earn income as both creators and CEOs (hint hint: it’s all about relationships).
Today’s discussion is moderated by Michelene Wilkerson. The talk features:
- Ronak Trivedi, co-founder & CEO at Pietra
- Alexis Gay, former Senior Manager of Creator Partnerships & Business Operations at Patreon
- Walker Williams, co-founder at Fourth Wall
Trivedi, Gay, and Williams’ combined experience makes them experts in this space. They know how to monetize social media and build up an audience to produce a tenable income stream. Alexis Gay even made her own jump from Patreon employee to full-time creator. Now she makes fun of Silicon valley (don’t worry, they love it) and interviews leaders on the Non-Technical podcast. You can read all about her path to comedy here.
You’ll find actionable advice in this talk, whether you’re a:
- Great Resignation participant looking to earn via more flexible working hours
- New creator who wants to learn the basics of how to monetize your social media
- Influencer-turned-entrepreneur seeking wisdom from the experts
Let’s jump in.
How to Monetize Social Media Platforms: A New Playbook
Wilkerson: What do you believe is the new business plan or playbook for creators to monetize the audience they’ve built on social media?
Williams: While advertising and sponsorship dollars have been pretty significantly impacted by coronavirus with a lot of companies pulling back, viewership numbers are actually way up for most online platforms:
- YouTube
- Tiktok
What we've been seeing is a move from a focus on sponsorships and brand partnerships to more diversified revenue models:
- E-commerce memberships
- Shout outs (Cameo raised $50 million to do this)
- Direct-to-fan interaction
Gay: Now more than ever, fans are looking for a way to connect, not only with each other, with their friends and family, but also with the creators they love. So offering a little something extra or something new in the form of merch or a live stream is a great way to both stay connected and also to replace some of the revenue they may be missing out on.
Trivedi: As viewership numbers go up and people are more connected through social media, we're finding that people are getting more and more excited to follow the journey of creators. We're seeing more and more people share the process of creating what they will eventually monetize, whether it's a jewelry line or beauty collection. This landscape is ideal for influencers ready to become entrepreneurs.
Before, Instagram entrepreneurs would have one big product reveal, but now we see people being very excited to join creators on the journey. It culminates in something that people feel a part of, which is a little more authentic.
Monetize Your Social Media Account with Personalization
Wilkerson: It’s possible to serve your audience and still never make money. So how do creators monetize social media followers while they engage them and give them exclusive access to behind the scenes content?
Gay: I think about a creator's audience like a funnel. At the very top of the funnel, you've got folks who are interested in your content—the casual fans. And then all the way at the bottom, you have that most engaged segment of your audience. These are the people who are going to:
- Join your membership
- Buy your merch
- Buy your products
Creators need to strike a difficult balance: creating content that's going to go wide while still serving the most engaged superfans with exciting, exclusive, paid-for content.
To make this happen, think about two things:
- How will you feed the top of the funnel and bring new fans into your ecosystem?
- What are you creating that will be special and exciting to the people who come back every week, who like every post?
Williams: I think for some industries—like if you're teaching or selling courses—it makes sense to move a huge percent of your content behind a paywall.
But, If you're on an algorithmically driven platform like YouTube, Instagram, or TikTok, the more that you can put out for free the better. Those algorithms feed off of engagement and view counts to give you new eyeballs and to recommend your content to new fans.
What we see is that people often put their content behind a paywall a little too early. Doing so is not always necessary. When you think about how to monetize social media followers, what we actually see is that the top 1% of fans that have the ability to financially support you and the love to do so.
What they are looking for is a deeper connection with you. So instead of putting content behind a paywall try creating e-commerce offerings or sending members personal thank you notes.
This is good news for creators. For example, Instagram entrepreneurs can focus on cultivating a fan-creator relationship in their comment sections which will then drive demand for exclusive subscription-based content.
How Influencers Become Entrepreneurs: Relationships
Wilkerson: It sounds like we have our first major key for the playbook we're creating on how to monetize a social media app: expand and throw the net really wide. Don't limit yourself. Get more content out there.
With that being said, every business comes with a risk. As a creator relying on content for income, the risk is “can I pay my rent?”
To mediate this risk, what are some key best practices you’ve seen from people who have been successful on your platforms?
Trivedi: What's very interesting to me is helping creators understand that they can start thinking about what they’re doing like a business.
With Pietra, we take great care in building growth tools. Even just saying the word growth tools to a creator can sound daunting, but it’s important to help them understand things like:
- You should collect email addresses
- You should start a newsletter (even if you think you have nothing to say)
This is how to monetize social media followers. It's like planting a tree. In a year from now, these steps will be very helpful to your business. Although you may be at a different starting line than someone else who does have an audience, very quickly when you're a year in, you will be operating a successful small business. If you want to use that business to make a living, then it's beneficial to think about all the tools you have at your disposal.
Companies like ours (Patreon, Fourth Wall, Pietra), make these tools accessible and easy to use.
It’s important to remind creators that it's okay to use these tools, just like everyone else. They're meant for you to turn your small business into something you can make a living on. At Pietra we think about how—after the initial pop or video that goes viral—we can help make sure a brand grows into the next big thing.
Williams: A very small portion (1 to 10% of your audience) become super fans. You want to have direct relationships with those fans because the platforms aren't going to give you that. The best thing you can do is establish those relationships with those super fans and then invest in them.
Regardless of what happens with the platform, those are the fans that are going to stick with you. Maybe you:
- Move to another platform
- Start a newsletter
- Create a membership
The relationship you build with your fans affords you ownership and control of your income and reduces risk.
Gay: I love that point so much.
Building the relationship with your superfans is a key to stability as you monetize your social media.
I would add that stability is what gives you the flexibility to actually grow and experiment as a creative individual.
As a creative, there are plenty of ways to make money doing the same exact thing over and over and over. I'm thinking specifically about more algorithmically-driven opportunities for monetization like ads. But as a creative person, if you want to grow and you want to stretch and experiment and expand, you need to own that relationship with your superfans. Ultimately, the best social media platform to monetize is the one your fans use. The good news is that dedicated fans will follow you wherever you go:
- YouTube today
- Tik Tok tomorrow
- A book or in three years
- A TV show in five years
You'll take that audience with you place after place, and you won't be beholden to some sort of algorithmic change or other unanticipated event because you'll be protected by that relationship you've built with your fans.
Emma Chamberlain, Gen Z’s Favorite Influencer-Turned-Entrepreneur
The last time Emma Chamberlain posted a Youtube video (“u totally caught me making soup”) was in December of 2021. Yet she retains her cult-like following and was ranked by Gen Z as the #1 influencer in the most recent Taking Stock with Teens survey.
Chamberlain’s particularly informal style has a knack for making followers feel like close friends. This fan-creator relationship is reflected in her comment section, which read like texts from (millions) of worried friends:
YouTube hiatus or not, Chamberlain’s business is thriving.
She has built a fanbase that’s willing to follow her wherever she goes. Most recently, that’s to her wildly successful Chamberlain Coffee brand, poster child for successful influencer to entrepreneur pivots.
You Don’t Need 1 Million Followers to Become an Instagram Entrepreneur
However, creators don’t need Chamberlain’s scope of influence to monetize social media.
Wilkerson: I love the metaphor Ro brought up about planting the tree. As you nurture that connection with your audience, it will grow over time. I also want to acknowledge that there are some creators who will never grow up to be a big oak or redwood tree. Some creators intentionally keep their audience and community small.
Are there examples of creators who are financially successful, who are keeping things small scale? What are they doing differently from people who have bigger platforms, but don't know how to monetize their audience?
Trivedi: I have one example that I can speak about who is near and dear to our hearts at Pietra.
One of our creators launched a jewelry line for the nonprofit she started with a friend that provides peer support for people dealing with eating disorders. It’s called the Chain, you should check them out.
Her and her co-founder are very principled in their process. They’re like, “we don't need to overextend. We have this amazing community and we want to create things that are for this community. And we want the community to organically grow and appreciate the products that we're creating.”
At Pietra, we can go to a creator and tell them what they should do to try and make as much money as possible, but they may be working from a principled perspective. We’ve learned that not everyone wants to make the most amount of content, products, or launches. The goal can be to feed their niche rather than explode it into something amazing overnight.
Gay: I'm thinking of Patreon creator, Jessica McCabe who runs the YouTube channel “How to ADHD.” which is a YouTube channel. A Business Insider article just came out about how she's earning an additional $15,000 a month in income from her 2,500 patrons.
While 2,500 is a decent group of people, it's not the 10,000, 15,000, or 20,000 people we might think are required to earn additional income like that.
Trivedi: Yes, everyone's spectrum of what's big and what’s small is completely out of whack. Like the number of value-add investors that you need to support your venture is usually smaller than you think. The number of people that will follow you automatically and not convert is usually way larger than you think.
Gay: Right! 25,000 followers would fill Madison Square Garden. That’s a 20,000 seat arena.
Wilkerson: Oh my goodness. Alexis, when you just said 25,000 fills up Madison square garden, that was actually a huge aha moment for me too.
How Influencers Become Entrepreneurs: Authenticity
Wilkerson: There's so much external noise that's influencing and messing up and jacking up what success looks like.
What advice would you give to creators about aligning their intentions to what they actually want versus what they think they should go after?
Williams: I think in, in my experience, if you focus on delighting the people who will become your fans, if you focus on building that relationship with a small group of people, the monetization will come.
It's different for every type of creator. It might be courses. It might be membership. It might be e-commerce. It might be brand deals and partnerships. It differs widely depending on sort of what your focus is, but the connecting thread between all of the successful creators that I know and have a chance to work with is that they're really focused on providing a really delightful experience for the fans, and then the monetization comes naturally.
Trivedi: We get this question a lot from creators who sign up for Pietra. There's a natural fear that comes with creating something and putting it out there and seeing if it's gonna work.
What I always tell people is that people online—especially Gen Z—are pretty good at sussing out inauthenticity.
So don't be discouraged by the absolute numbers today, as long as you're being authentic.
There are people that share your same passion and people are going to be inspired by your passion. If you show them over time that this is an authentic endeavor that you're undertaking then, like Walker said, it's going to lead to something.
Rihanna Fans Don’t Have New Music, But at Least They Have Fenty
Entrepreneur influencers and celebrities like Rihanna have a knack for building authentic, inclusive brands from the ground up.
In 2021, Forbes estimated that she was worth $1.7 billion, largely due to her makeup line, Fenty Beauty, which consistently sold out in its early days.
Since then, Rihanna’s brands continue to earn praise for their extensive range of skin tones, vegan formula, and gender inclusive marketing.
Rihanna’s pivot from grammy-winning pop star to mogul is an impressive representation of celebrities’ ability to steer their careers from entertainment to business with resounding success.
Wilkerson: I love it. I hope the audience was taking notes because these are gems. So major keys:
- Build relationships with your fans
- Compete where you can win
- Create for your audience, not just an audience
And the monetization will follow!
Looking for more gems on taking advantage of the new Industrial Revolution from home to convert your creativity into cash and monetize your social media? Check out:
- The Story Behind Viral TikTok Beauty Brand Youthforia
- 2023 Preditctions for the Creator Economy
- Switching Careers in a Changing World
- These 5 Black Women Became Entrepreneurs During the Pandemic. They’re Thriving.
- The Next Gen of Influencer? Meet the Technical Content Creator
