Subsidizing Creators Ain’t Easy; TikTok Learns From Search (And Vice Versa)

Here’s today’s AdExchanger.com news round-up… Want it by email? Sign up here.

Creatoring Something Out Of Nothing

Tech companies spend millions of dollars – even billions – to subsidize creators. But have any started a creator revenue flywheel (aside from YouTube)?

Paying creators is expensive, and the payoff isn’t always clear. Sometimes it can feel like a lottery system with occasional lucky winners. 

Snapchat paid out more than a million dollars per day last year, but the bonanza only lasted a few months – and, anyway, $1 million per day is relatively low if you want to attract a vibrant creator economy.

TikTok, which has a $200 million creator fund, is a newish platform, so creators are more willing to patiently await the rollout of revenue-generating products. But that patience won’t last forever. Supporting creators will be a huge business challenge for TikTok this year, according to eMarketer.

But creator funds aren’t specific to social media. Last week, HubSpot announced its own fund to back podcasts covering B2B and lifestyle topics. 

The true test for platforms looking to woo creators will be if they hang around for sustainable monetization even after funds dry up. YouTube has gotten to the point where services like Spotter, an LA-based content investment startup, now make large upfront cash offers in exchange for licensing and monetization rights to a creator’s library.

TikTok Search Adds

Tick, tock, tick, tock. 

TikTok is feeling the pressure to show revenue gains, which is why the platform has started testing sponsored search results, Search Engine Land reports (h/t to social advertising consultant David Herrmann aka @herrmanndigital for the spot).

TikTok search ads are in beta with select advertisers, but those early adopters can glean some worthwhile analytics and engagement boosters from the product. 

For instance, it’s still too early for TikTok to enable keyword-based targeting. But advertisers do see which searches led to clicks and conversions. For what looks like one shoe brand, Herrmann tweeted an image of different search terms that led to conversions, such as “cheap boots,” “icing sneaker soles” (a way to clean used sneakers) and “how to get white tennis shoes clean.”

What can advertisers do with that information? Herrmann suggests repurposing the slugs that work best as new titles for a brand’s best-performing past content as a way to get more juice out of the archive.

Another lesson is to focus on solving problems. Rather than targeting brand associations, provide helpful answers to the questions people ask. 

“Make your ads solve problems, don’t just sell. Drive them to advertorial pages,” Herrmann says. “This is Pinterest 2.0, but better ’cause people buy haha.”

The State Of Privacy

There’s no federal privacy legislation in the US – yet. But Utah just became the fourth state to sign its own privacy bill into law.

Last week, the Utah Consumer Privacy Act (UCPA) hit the books with an effective date of December 2023. Utah follows California, Colorado and Virginia in giving consumers more control over their personal information.

Congress is also putting its thinking cap back on. Recall President Biden urged legislators to get serious about setting safeguards around children’s online data during his State of the Union address earlier this month.

Bipartisan legislators from the House and Senate will convene as early as this week to talk through potential comprehensive privacy legislation at a federal level, The Wall Street Journal reports.

Despite the bipartisan backing, sources tell the Journal to expect roadblocks. Rather than a comprehensive bill, legislators may narrow their focus to children’s online privacy. And even that’s no guarantee meaningful action will be taken. Recent bills, such as the EARN IT Act, aim to mitigate online harms to children but make little headway on data protection.

So, can the US expect its GDPR?

Maybe. But who wants to be known as the legislator who brought European-style pop-ups to America?

But Wait, There’s More!

Magna is decreasing its US ad spend forecast in light of Russia’s invasion of Ukraine. [Adweek]

Morning Brew tops four million newsletter subscribers and looks to expand with M&A. [CNBC]

What is “pyrrhic privacy”? When ad privacy concerns lead to worse outcomes for web users. [Mobile Dev Memo]

Adam Singer: What digital marketing and RTS games have in common. [blog]

Kroger named Pacvue, Skai and Flywheel Digital as initial partners for third-party advertising on its site and apps. [release]

Will Apple undercut the streaming market with a subscription bundle plan? [MediaPost]

Enjoying this content?

Sign up to be an AdExchanger Member today and get unlimited access to articles like this, plus proprietary data and research, conference discounts, on-demand access to event content, and more!

Join Today!