The Growth of UGC

This is a good example, as it helps create community dynamics that meet marketing needs.

Everyone is trying to integrate it, and for now, it holds much more value than “powered by AI.”

An example is “Lemlist”

A mailing tool as basic as others, except that their growth engine is creating a community space with the results of prospecting campaigns. You have direct access to campaign templates with their open and response rates.

(By the way, this space is partially accessible without an account, but we’ll get back to that.)

Currently, several beliefs in marketing are either flawed or evolving.

First, storytelling:

We imagine it as the cornerstone of marketing, when it is just a facade tool within a simple process of:

1. Generating authenticity

2. Then trust

3. And finally, conversion

What I’m saying here is that it works very well, but the angle from which it is approached prevents it from being used other than as “sales copy.”

Second point, the “Brand Creators”

In the same logic of using storytelling as sales copy, many brands want to convert into creators, with podcasts or “semi-promotional” content.

A mistake:

Is believing that social media are visibility spaces to be conquered.

In reality, it’s entering the general fray to compete for users’ attention.

A battle lost from the start…

Creators whose business it is will inevitably be better than brands.

(There’s no point in going into battle with a bow and arrows in a tank arena… is there?)

UGC Marketing:

It’s true that a solution to the visibility problem can be envisioned, and scaling promotional content in different formats isn’t uninteresting.

The trouble is, the human brain only gets better at recognizing promotional content to skip it.

So, influencer marketing?

Of course, it’s a solution, and it actually works quite well, but is it the most viable one?

A Crisis of Trust:

The refinement of “disguised” promotional content has contributed to the crisis of trust that the internet is experiencing. Consumers are finding it increasingly difficult to distinguish content, feeling manipulated.

Transparency regarding the commercial relationship between an influencer and their sponsor hasn’t solved the problem; it may have even exacerbated it by concretizing a bias, compounded by the lack of contrast in product presentation.

We know how important this is !

Amazon understood this well by adding bad reviews to ensure contrast and generate more trust.

The strategy I believe in is Trustilization.

“The process by which a civilization or society develops and flourishes by establishing and strengthening mutual trust among its members, its institutions, and its social and economic structures, including in commercial transactions and economic interactions.”

This strategy works with UGC and aims to benefit from the collective intelligence of a community built on trust.

I’m not talking about using UGC as in “UGC marketing” but about being, or having, a UGC product.

Let’s take Lego as an example:

They understood that they shouldn’t restrain the community but encourage it:

In 1998, Lego launched “Lego Mindstorms” for the general public. This new range included gears, motors, and the ability to develop your own robot.

Very quickly, it wasn’t the general public but engineers who took hold of the product.

In no time, they cracked the firmware and published the code online.

Lego initiated legal action… where they expected to find malicious individuals, they discovered geeks.

They weren’t trying to harm the product; they were trying to push its limits.

Lego understood this lesson well because 15 years later (in 2014), Lego bought an independent Japanese project called “Lego CUUSOO.”

On this platform, the community can propose Lego set ideas, and when an idea gets 10k upvotes, Lego studies it, then publishes it and gives the creator 1% of the revenue.

It’s from this platform that several sets have emerged.

In summary, it’s important to keep two things in mind:

1. Don’t let pride in your product prevent it from exceeding its designed possibilities.
2. Keep your most important community members engaged.

Another example is Super73.

They understood how to become a reference product thanks to their community:

Super73 arrived in 2016 and launched via Kickstarter. It’s an electric bike brand unlike any other. Today, it’s doing so well that it has stopped using resellers; orders are made exclusively online.

So, how did they get there?

To start, they released a stylish (retro) product. It may seem trivial, but before them, attention to aesthetics was nonexistent. Their core strategy was already focused on product pride.

Pride implies personalization, and they’ve had that in mind from the beginning since they are based in California.

If that doesn’t ring a bell, keep in mind that the culture of customization is so prevalent in California that it’s not uncommon to see cars with double their purchase price in customizations, just as independent restorers are preferred over the manufacturer’s restoration service.

So Super73 kickstarts an aftermarket accessories market by launching a customizable product where customers have the budget and desire to personalize it.

Immediately, independents start creating accessories, and Super73 boosts them by not creating any competition but, above all, by adding the independents directly to Super73’s website.

Obviously, their influencer marketing played a big role in their visibility, but the product would never have been as successful without this community strategy.

In summary, it’s important to keep two things in mind:

1. Give your community the ability to make your product their own.
2. Each product customization by the community creates a new storytelling.

One last example, Roblox:

Beyond creating a community, it also allows you to spot trends.

Originally, Roblox was a UGC platform over 10 years old, allowing the creation of gaming experiences. Today, the platform is morphing into a social network, and 71% of 15–17-year-olds say their real-world style is inspired and influenced by their Roblox avatar’s style.

We know they didn’t anticipate this because they only opened the creation of clothing to the public a year ago (2023).

This subject takes on a whole new dimension when you know that some companies now want to test their collections on Roblox to only release those that perform best.

Most importantly, note that:

1. Understanding a community’s needs beyond its demands is crucial.
2. Community creators can alter a market.

Remember when I mentioned the Lemlist community space, accessible without an account?

Let’s get back to that — giving direct and free access to your community’s products is more important than anything else.

Accessibility

Direct access to community creations makes your product comprehensible; even before using it, one can imagine the extent of its possibilities.

The benefit is that each objection or point of contrast from the user is no longer projected onto the product but onto the community’s content.

Marketing

Each new creator/product in the community adds an ambassador, a story, a use case, a customization (and thus a self-sustaining marketing effort).

Trust

It’s the best trust generator there is. Far beyond reviews, the diversity of community content immediately reveals the number of people with whom you’ve created consensus based on your product.

It’s even better when creators within your community make a living from their creations.

As you can imagine,

This is a strategy we are going to include at Influnity, but not only that.

It’s a strategy we want to make accessible to the creators and sponsors who will work with us.

What we’re planning:

As I mentioned, the deliverability of high-value and free content is important and will become essential, but it’s a complicated and competitive exercise.

What seems obvious to us, therefore, is that maintaining free content will be exchanged for attention and engagement.

Influencer marketing will continue as it is, but creators will be led to create content directly on brand networks. Instead of promotional content, the content will focus on the use/setup of a use case designed by the product community.

Where Influnity comes in, we will enable two things:

1. Linking the product and content,

The solution allows for authenticating consumption and engagement around the content, which will maintain free content for user who participate in the marketing directly and, most importantly, on a regular basis.

2. Influencer targeting

The solution allows for discovering sub-audiences, enabling a brand’s clientele to be segmented: 30% follow influencer A, 20% follow influencer B, etc.

If this vision or solution resonates with you, I’d be happy to discuss it further.

Learn more

Raph & Jean-Charles

We are about to discuss the sector everyone is turning to, the creator economy! It may sound silly to say (or write), but it has become almost absurd to launch an activity without creating online content.

What was once a trend has become a norm, thanks to the sector’s players, who have made the different steps of content creation more accessible.

But

There is often a gap between making a sector accessible and meeting its needs.

It is enough to meet a direct demand without understanding the needs. This is how we end up with a saturated market, offering solutions that reflect the same underlying problems.

Example: The taxi market versus Uber

There are several inherent problems in the sector. I already discussed the lack of data in another article, but now we will address a much more structural invisible ceiling.

But… What is a invisible ceiling?

Beyond the players in the creator economy, the invisible ceiling is a limit intrinsically linked to the business model. It is the growth of an entity that is hindered or even blocked by its model and/or structure.

Example: If you sell your time, you can always sell your time for more, but there will always be clients you have to turn down. (Not to mention the price threshold for your clients/prospects)

How to define a invisible ceiling?

Lack of scalability :

As seen in the example, it is the too significant correlation between the need for resources (usually human or logistical) and the value proposition.

Addressability :

Addressing a market that is too small is a invisible ceiling, just like overly dynamic competition. It is often said that new SaaS addresses new market segments, but you still need to find a segment large enough to generate revenue but small enough that no competitors have targeted it for expansion.

Acquisition cost :

Whether it is the prices or accessibility, they all reside in marketing. You can have a very expensive restaurant located 4 hours away in a forest. If you do the appropriate marketing, you will always have customers. Therefore, there will be a marketing cost to assume, and you will not have significant passive acquisition.

Which category do you think the taxi market fell into? I will answer further down ;)

So who are the players and what are their limits?

I apologize, but this step is important to understand, so! We have:

Ad Platforms

YouTube, Instagram, TikTok, etc.

• Model: Uses free cloud services to attract more creators and improve ad targeting.
• Problem: Cloud costs and reinventing ads do not directly convert to more sponsors. Not to mention competition with influencer marketing.

Visual Creation Platforms

Canva, Descript, CapCut

• Model: The more accessible content creation is, the more creators there are.
• Problem: Increased accessibility can lead to oversimplification and increased competition, with a constant customer retention cost.

Networking Platforms

Aspire, CreatorIQ, Grin, UpInfluence

• Model: The more qualified creators and sponsors there are, the more traffic and revenue there is.
• Problem:
• More clients => Less qualified => Less activity.
• Fewer clients => More qualified => Limited market.

Tracking Tools

Traackr, UpInfluence, HyperAuditor

• Model: Billing based on tracking volume.
• Problem: Low added value, often added as an auxiliary feature to networking platforms.

Merchandising Platforms

Shopify, Teespring, Printful, Redbubble, Gumroad

• Model: Demand scale from creators.
• Problem:
• Low-quality products with high margins require a large marketing budget.
• High-quality products with low margins suffer from marketing competition.

Exclusive Platforms

Patreon, Substack, OnlyFans, Ko-Fi, Gumroad

• Model: Facilitates monetization for creators in exchange for a share of their income.
• Problem: Depends on the creator’s ability to attract and then monetize their community on the platform.

So! What is the common invisible ceiling?

Let’s revisit the demand/need analysis and say that the market boils down to: I am a creator and I want to improve: my videos, my stats, and my revenue.

Do you see the problem?

If not, I will help by answering the question “which category for taxis”:

It was addressability: Everyone was fighting over their market segment, and it only took grouping them together to become the leader. Users did not care much about there being taxis everywhere, and yet at the time, any taxi company’s goal was to scale by recruiting more taxis.

It’s the same here; all the players seem to have forgotten that the follower is at the base of the economy, and the only thing that interests them is having an interaction with their creator. (I have explained this extensively before)

Do you think I am extrapolating?

In 10 years, how many new interaction methods have emerged? If there have been more than 2, it’s a stretch. (There is a world where OnlyFans democratized the last “new” method..)

Because apart from the reach for voting, forms, Instagram/Telegram/Discord channels, and monetization, there is not much else.

The worst is on the data side.

The poor general quality and lack of engagement have been described for several years.

Apparently, if you are not given the one thing that makes you want to move, you will not move?

The same applies here: if we want to generate data, we must encourage your community to do so, and that can only happen through interaction.

So is Influnity perhaps the Uber of the creator economy?

It’s unlikely, but what is certain is that as I said at the beginning, between meeting the demand and meeting the need, there is a link that is not always made, and obviously, here it has never been made.

• Influnity is not a third-party monetization solution that forces people to migrate.
• Influnity is not a data visualization solution based on other platforms’ APIs.
• Influnity is not a sales booster for merchandising.

The democratization of the creator activity is a success, but the sector’s persistent problems have not been addressed, and Influnity focuses solely on them.

Addressing the three drivers of the economy:

Creator, Follower, and Sponsor

With solutions focused on:

Interaction, Interoperability, and Data.

Thank you for reading, I would be happy to discuss if the topic resonated with you !

Learn more

Raph

I almost want to apologize for making such a corporate conclusion, but I had to wrap it up.

What is interoperability and who is doing it?

Beyond connecting several distinct environments, interoperability in a sector addresses several levels of demand:

For builders/pros: The ability to connect their solutions once to a heterogeneous variety of ecosystems.

• Restream: allows streaming on more than 30 platforms with multichat integrations.
• Canva: allows automatic posting on multiple platforms.

For Data: The ability to communicate data flows in a unified way.

• Hootsuite: allows managing multiple social media accounts and scheduling posts from a single interface.

For users: The ability to navigate with their packages/data in different ecosystems.

• Linktree: allows connecting an entire ecosystem on one page.
• Google connection: beyond simplified login, the permission system allows any site to execute actions simply using user information.

Why interoperability?

The list of examples above summarizes well the issues that, initially, may not be clear from the demand side but become evident when faced with the solution.

“58% of creators produce 2 to 4 types of content on different platforms.” NeoReach Report 2023.

One can imagine the “Ah yes, finally!” effect upon the release of certain solutions.

General perspective:

The value of an interoperable solution is not only evident through its direct use but also through the structural value it produces.

For example, without Linktree, there would never have been a mapping of the number of creators on the internet. Their tool allows understanding how a creator’s different networks are structured.

(Without Linktree, we could at best compare duplicates? Not even! There are homonyms, fan accounts, etc. I challenge you to find an alternative; there isn’t one.)

Another sector that knows this well: web3

A good example of interoperability at all levels is Axelar.

Axelar aims to ensure communication and functionality between different blockchains and their various layers.

Currently, deploying smart contracts only works on a single blockchain and communicates only with the technology and layer of that specific chain.

The goal of this project is to allow developers to address the entire network with a single integration, enabling users to activate any technology, and finally compile all interactions in “a single ledger.”

Metcalfe’s Law

When talking about interoperability, one must mention Metcalfe’s Law. This law states that the utility of a network is proportional to the square of the number of its users. Since we allow isolated networks to connect to each other and thus pool their value, it’s like a dark kitchen with 30 restaurants that share everything (stock, labor, marketing).

Why do we associate interoperability with Metcalfe’s Law?

Interoperability allows for addressing several forms of early demand and imposing the format of future demands, thus creating an acquisition channel.

3 good examples:

• Uber/Uber Eats: channeled logistics demand and standardized marketing through their platforms.
• Axelar: hopes to create a technology simple enough to build massive consensus and eventually transfer all blockchain protocols to them.
• Linktree: met the need for cross-platform connection and then formatted the demand for transit between platforms (a version of interoperability obviously softer than Uber or Axelar).

So is there real interoperability in the creator economy?

Obviously (and Linktree must be the most advanced in the sector), yet none of the solutions on the market address every facet of the subject.

To achieve true interoperability, we need to aggregate builders, users, and data. All around an additional layer (a layer 2).

What would complete interoperability be?

Beyond the constraint, what new possibilities would there be? What new market norms?

Tracking (data)

This would allow tracking a user through different environments (external interactions and especially internal ones within environments).

In comparison, on Roblox, we can track a user across several worlds, know where they look, which items they check. In short, it’s like following a customer in a shopping mall. (I recommend checking out Dubit to learn more.)

Incentive (user)

With such advanced tracking, this opens the door to personalized incentive systems. For example, rewarding the customers closest/most likely to make a payment.

(A good example that sets a new standard in the sector.)

Strategy (builder)

From another perspective, this would also allow some creators to detect new qualified audiences on other topics, justify the most opportune moments, and facilitate the perfect match with sponsors.

To recall, more than 60% of sponsors still work only with the same influencers because for more than 60% of them, it is still difficult to find the right influencer. (I talk precisely about the lack of data in my first article.)

So, how do we create what no one has been able to achieve ?

As I mentioned, we need to aggregate builders, data, and users around a layer 2.

Using the example of Linktree, there is actually no “user engagement”; the user only transits.

So the only real issue is: how to attract users?

We need to offer the user interaction with the creators.

I have already explained why interaction is the cornerstone of engagement in the article “What is the fuel of influencer marketing?”. I invite you to take a look if you want to delve deeper into this topic.

How Influnity addresses this solution:

We believe that rewarding a follower for simply consuming content is the basis of a viable solution. This way, engagement is not for us but for the creator, which seems more logical.

The idea is to offer the user to be tracked in exchange for rewards that they can convert into interactions.

In this way, aggregating a creator and a sponsor becomes obvious. Better tracking allows for better stats and better guarantees for partners.

A new era !

By translating this incentive base (rewarding content consumption) across different platforms, we will establish a new market standard.

This is a new step in bringing value from creators to their partners or audience.

Learn more

Mattéo & Raph

Sources for the Article:

1. NeoReach Report
2. Influent Marketing Hub Report
3. Forrester Research
4. Gartner

Basically,

An influencer has a community, or an audience, which in both cases generates traffic, and traffic… well, it sells! The question is how and why does it sell? As expected, to achieve this, it’s necessary to sustain community engagement around clear values before trying to monetize it.

What is the vector of engagement?

Micro-influencers can monetize their communities more easily than intermediate or larger influencers because their highly qualified audience becomes diluted as it grows.

Micro-influencers have a 60% higher engagement rate compared to macro-influencers, which increases their monetization potential.

Podcasts

• They work well because they create a sense of representation and thus a connection with listeners, particularly due to the diversity of guests and the quality of interactions/questions.
• To provide a counterexample, political debates on television create a sense of frustration because one often thinks, “I would have answered…” or “Why doesn’t he just say…”

Consumer Demands

With an abundance of choices, consumers seek content that offers real added value. Algorithms and the maturity of the content creation market have made everyone more demanding.

• Typically, 70% of Generation Z consumers say they prefer authentic and engaging content.

Consumer Maturity: Seeking Authenticity

Standardized advertising formats lead to disengagement as soon as they are identified, with the brain solely aiming to block them out.

• In fact, 81% of TikTok users prefer content that does not resemble traditional advertisements, prompting brands to integrate ads more naturally and creatively.

Example: UGC (User Generated Content)

Brands use influencers in a white-label fashion to capture consumers’ attention authentically, paradoxically keeping users engaged longer by depriving them of their usual markers (influencer’s channel logo, “sponsored content” label). In short, the challenge when content is not solely value-added is to create and then maintain curiosity as long as possible.

What can we deduce from all this?

A one-sided relationship is created in content consumption, but the lack of interaction has driven people to seek alternatives. Influencers, however, must maintain this authentic relationship to stay relevant.

74% of consumers say they would leave a brand if they perceive a decrease in authenticity in their online interactions.

In fact, the statistic that is almost impossible to measure is that influencers face the same problem, but magnified by 10. They embody a brand, and the only thing that separates them from abandonment is the ‘unsubscribe’ button, which generally only affects 1/10 of the influencer’s audience. (so actually it’s x100)

Influencer-User Interaction

We believe that the cornerstone of influencer marketing is the interaction between the user and the influencer.

Platforms like TikTok and Twitch have based half of their monetization system on live payments and subscriptions for interactions or exclusive content.

From this point, it’s clear that “interaction is at the heart of everything, but..

Have we really explored all possibilities ?

If a friend asks you to help them move, it feels more normal for them to offer to grab a drink together rather than pay you $10.

Two things to keep in mind:

1. Viewers feel they have a bilateral link with their influencers.
2. Engagement in a relationship is only motivated by interaction!

How to extend this to brands?

Brands need to originate the interaction between the user and the influencer.

By creating an interaction funnel through sponsorship, as proposed by Influnity, the needs of the three actors in the influencer-sponsor triangle are addressed.

Raph

Learn more

Thanks for these reports for the data ;)

• 2023 Global Social Media Trends Report
• Linktree : Creator Report
• Neo Reach : 2023 Creator Earnings Report
• The Goat Agency : Next Era of Influencer Marketing

Background

ByteDance launched “TikTok Lite,” an integrated loyalty program within TikTok. The concept is straightforward: the more time you spend on the app consuming suggested content, the more “miles” you earn. Subscribing to creators and sharing affiliate links also yield points, significantly more so. Eventually, 100 “miles” can be converted to €0.01.

Summary

This loyalty program allows TikTok to increase the time spent on the app, enforce immersion, and expand its user base.

What’s the issue?

The highly addictive nature of the “Lite” version, coupled with minors’ ability to bypass age verification and thus earn money (which is prohibited), poses problems.

But hasn’t this already existed?

From mobile apps/games, UGC platforms like Roblox, Fortnite, Zepeto, to other social networks

these elements are ubiquitous.

• Highly addictive mobile apps/games… everyone has spent time on them (even my grandmother).
• Minors earning money… Yes, it’s prohibited, but many kids have lied about their age to convert their Robux into dollars/euros.
• Rewards for actions/gameplay exist on Roblox.
• Rewards for affiliations…

So why TikTok in particular?

Factory Work It’s essentially assembly line work in a factory.

• The program requires an action every 30 seconds and complete video views on vertical content.

It’s the mix of alienation and the curiosity (to scroll) that leads to addiction.

Lack of “Intelligence” in Content

• There’s already little “educational/valuable” content in the vertical format (simply because it’s less suited for it).
• We also knew that the representation of educational content was not the same in the West as in China.

Obviously, allowing the purchase of available brain time without intellectual value in return poses a problem for the administrators of the selling country.

All for ByteDance

Paradoxically, contrary to what one might imagine, TikTok Lite does not benefit its users.

• Contrary to the narrative defended, everything was obviously designed so that TikTok could achieve its goals without ever really responding to the demands of its users.

When a product is designed for a target audience, it is imagined so that the user can use it to the extreme without it posing a risk to them.

The Infunity Loyalty Program

It’s designed for Sponsors, Influencers, and Followers: We seek the user’s attention and engagement on long content that the user seeks out themselves.

The major difference with TikTok’s program is that it’s not designed for the platform but for the creators.

The goal is for influencers to reconnect with their most loyal community.

The advantage of approaching a loyalty program through influencers is that they naturally find the balance between what they ask for and what they can offer.

Raph

It’s TERRIFYING to see that a $24 billion market tracks so little data.

The problem is so concrete that one-third of sponsors don’t even bother measuring the ROI of their influencer marketing campaigns…

Why?

The typical scenario: a viewer consumes sponsored content, six months later they make a purchase.

They never used any tracking tools (discount codes, affiliate links), so we don’t know where they came from, who influenced them, what triggered their activation, nor their exposure frequency, and so on…

Obviously, it seems discouraging…

Yet, nearly 60% of sponsors plan to increase their budget for influencer marketing this year.

So, how do we explain this?

Firstly, some campaigns aim not to drive sales but to build awareness. Secondly, 63% of sponsors continue working with the same influencers to reduce their exposure to risk. Lastly, despite opinions, influencer marketing is a trusted tool and works well.

Interestingly, while 66.92% of creators earn most of their revenue through brand deals, many sponsors still lack precise ROI measurement tools

In conclusion:

One might think the issue is :“How to engage viewers more ?”
No ! It’s a trilemma between Creators, their Followers, and Sponsors.

Sponsors need much more data than just knowing who saw their ad or bought their product.
Creators need more than just tracking/discount tools to engage their community.
Followers need more interaction to engage.

With Influnity… (of course, I have a solution for everything ! What did you expect?)

I’ll spare you the advertising spiel that interests no one 🤡, and I’d be delighted to discuss it with you sometime.

Thanks to Influencer Marketing Hub for the stats.

Learn more

Raph