July 28, 2020: TikTok invests $200M in Creator Fund; Google unveils video shopping platform; Snapchat releases Q2 Earnings
Here’s what’s worth knowing this week:
TikTok’s $200M Creator Fund
TikTok has introduced a $200 million “Creator Fund” which will be distributed to US creators over the coming year.
How will the fund work?
As the name implies, the Creator Fund will go towards supporting creators who “are seeking opportunities to foster a livelihood” on the app. Select creators will receive regular payments over the coming year, and the fund will grow over time. The company has yet to confirm if there’s a limit to how many creators will receive funding, how often payments will be made or how much creators can earn.
Tbh, eligibility is still somewhat blurry. According to TikTok, to be eligible, creators must be 18 years or older, meet a certain baseline for followers (which is currently unspecified) and post original content that’s in line with TikTok’s community guidelines. Depending on the follower requirement, this, of course, leaves a lot of creators eligible for the fund.
What’s in it for TikTok?
Image control, of course. With TikTok controlling which creators receive funding, the platform will aim to keep quality creators on the platform, which in turn, will encourage more users. The fund could also help the company in its ongoing struggles with the US government, which has recently discussed potentially banning the app. While TikTok has spent months trying to build credibility as a legitimate American company, a $200 million creators fund is another way that TIkTok can show its commitment to the U.S. (it so happens that TikTok also announced this week it will be adding 10,000 more staff in the U.S.).
We’ve always said the platform that is most empathetic to the creator experience will win the market share of creator talent, in turn becoming creators’ platform of choice. Where the major players in the social media space (think: Facebook, Instagram and YouTube) have, for so long, largely fallen short has been in their inability to understand creators’ struggles and speak their language, TikTok has taken a different approach.
Since its inception, executives at TikTok have recognized the value in designing a platform with a creator-first mindset. In fact, this isn’t even the first time the platform has created a fund for creators; the company launched a $50 million Creative Learning Fund at the end of May for teachers on the platform. However, the introduction of the “Creator Fund” marks the first major effort from TikTok to pay creators directly for their content (keyword: directly). While, previously, creators could monetize their live streams, the new program will pay creators directly for making videos.
Google’s Shopping Push
Google’s research and development lab, Area 120, has unveiled Shoploop, a video shopping platform for finding, reviewing, and purchasing goods.
What is it?
With the platform, users can watch 90- second or less videos to discover a range of products and access product reviews from other users. Consumers can save products to buy later or click to buy it directly on merchants’ websites.
Oddly enough, Google isn’t necessarily accessing their treasure trove of beauty and lifestyle creators on their platform. Instead, content creators will have to apply through the Shoploop website to become an exclusive Shoploop creator.
Shoppable content is IN — and it makes sense why, given just how prevalent online shopping has become during the coronavirus pandemic. Replicating the physical shopping experience is close to impossible, but adding more elements for consumer validation and social proof to take place will help consumers make their purchasing decisions. Google is integrating those social proof elements through ratings, reviews, and tutorials, which give consumers more confidence in their buying decisions, letting them know how and if the product will work for them.
More and more, we’re seeing platforms understand that in order to integrate shopping elements effectively, social proof must be at play. Consumers need to know exactly what they’re buying and how well it works especially if they can’t try it out in person.
Snapchat Q2 Earnings Report
Snapchat has released its Q2 2020 earnings report, reporting better-than-expected revenues and strong user growth.
Give me the TLDR.
On the user front, the platform added 9 million new daily active users for the quarter, and is now up to 238 million DAU. Notably, Snapchat has seen the most growth in the “rest of the world” category which, CEO Evan Spiegel, attributes to improvements in how Snapchat runs on different devices.
When it comes to revenue, Snapchat has seen continuous growth, up 17% YoY, bringing in more than $454 million for the quarter, with performance advertising driving the majority of its growth.
Also, ICYMI – Snap is testing Brand Profiles.
Last week, Snapchat also announced it’s beta testing Brand Profiles, a feature that aggregates all the Snapchat tools (think: Branded AR Lenses, Highlights, Story posts, Native Store) into one place for marketers. The page itself functions as somewhat of a profile page for brands — something the platform has long been lacking when it comes to housing permanent content.
Why should you care? In addition to the sheer visibility Brand Profiles can offer brands from a content perspective, approved Brand Profiles will also have access to a suite of management tools, including analytics reports, audience demographics and interests, content management functions, and more. The duo of permanent content hub + streamlined measurement capes could be enough to push Snapchat to the forefront of some brands’ social media strategies.
As one of the first major social media platforms to announce its second quarter earnings, analysts are laser focused on Snapchat to understand the health of the digital advertising industry amidst the global pandemic.
Our POV? Don’t count Snapchat out just yet. Despite recording slower user growth and revenue than the previous quarter, the platform is still growing — especially among the Gen Z demographic and in non-U.S. markets. Snapchat reaches 90% of the 13-24 year olds and 75% of 13-34 year olds in the US — far more than Facebook or Instagram. Needless to say, the teens LOVE it. If your target audience is on Snapchat, it’s worth experimenting on the platform due to its sheer reach and influence among younger audiences.