Breaking Payments: Creators economy

Creators economy is a growing sector, estimated to involve millions of people with a wide range of activities and with different business models.

This article is based on the episode 130, hosted by Matteo Rizzi with FOUR exceptional guests: Bogdan Dinu (CPO at Thunes ), Elo?ne Barry (CEO at African Media Agency (AMA) ), Michael Callas (SVP, Head of elloU, Talenthouse AG ) and Laura McCracken (MD e-commerce and payments, Global Industry Lead at 埃森哲 ).

This episode was powered by Thunes, represented Bidgan Dino, as a company that continues to innovate in cross-border payments. Thunes helps businesses to move money cross-border in a very efficient and a very cost effective way processing today more than 50 million transactions per year in about 127 countries. Thunes’ traditional type of customers are neobanks payment service providers, but also some of the big platforms, some of the big marketplaces as well giving them access to the payment network, which is very crafty to their needs, and that helps them to efficiently send payments.

We started by providing some context into the content creators market: considering the market size, e-commerce is currently 20% of total commerce and social commerce is 10% of e-commerce. It’s a young sector but it’s growing very fast especially in markets like China, where it is already big, India, Brazil, LATAM.?

The panelists also discussed why users joined the Creators Economy, more and more. The reason is that many people can now create wealth through their passions, a major shift from the past few years. These new trend of content creation - gave the audience their new real celebrities, the digital influencers. Therefore, they have the power to affect the purchasing decisions of others because they have some knowledge or they have some authority.?

We also saw in the past few years that the media consumption is changing. Creators Ecconomy is part of a new paradigm followed by Millennials and Gen Z. Among these generations, many are drawn to the creator economy because of flexible working hours. They feel that they are into control. They feel that they are being their own boss. Content creation can also be a big moneymaker for them and a highly influential marketing tool.

If we call Creators Economy the thing that is produced by people that upload their content online, we may argue that YouTube, Facebook, Instagram have all been online for over 10 years, so why are we talking about Creators Economy today?

Laura proposed her answer: advertising. Instagram, Facebook, YouTube, Google, all of these companies have advertising. So you can click on an ad. It takes you off the site, onto a brand, some other website where you can buy something, you can buy whatever type of thing you want to buy.?

This social commerce is different, and is created through people.

An example that is possible to see in Africa or in India, is the use of Whatsapp as a selling channel. People create WhatsApp groups, with moderators that make sure that the sellers, influencers, creators, sellers merchants were legitimate and they were moderating what was happening. So this is how social commerce got started again, through hacks from people. In this model the only missing gear is payment.

Making people able to transact natively within the app rather than sending them off into another website has been a challenge for many players like Facebook and Instagram and also a turning point for the customer experience. Creatives could use NFTs and smart contracts can make enforcements automatic, but the link to improve is the payment for the consumer to buy and then for the seller to receive funds.

Fixing payments is today’s challenge, according to Bogdan, especially for creators that are in emerging markets but fintech is the key and thanks to fintech solutions even small-size cross-border payments are possible and even profitable. Payment companies that want to play a role in the Creators Economy cannot focus only on the US and Western Europe and have to target emerging markets. They need to be able to target the population that usually don't have a bank account or for whatever reasons they don't refer to a bank account.

Creators economy is a trend that we’ll continue to follow, especially exploring the new ways to monetize and make payment works better.

By Elias Secchi