Are Creators and Small Businesses Being Exploited by Social Media Platforms?

Rethinking the Value of Social Media

Have you ever considered how much the time and effort you invest in social media might be making someone else rich—while you see little to no return?

A few days ago, I came across a thought-provoking reel by an influencer, Barrett Pall, who clearly explained that creating free content for platforms like Instagram or TikTok in the hopes of making money is a form of exploitation. I agree, particularly as it echoes the broader changes in the digital landscape, such as the recent yet temporary U.S. TikTok ban, which highlights how creators and small businesses are at the mercy of social media platforms.

You can watch Barrett Pall's reel here https://www.instagram.com/p/DFCJdbexO4k/

And please follow his account on Instagram, @barrettpall.

As I reflected on my own experiences and observations, I started reconsidering whether the "creator economy" and the opportunities social platforms claim to offer are as empowering as they seem—or if they're just another way for platforms to profit at the expense of the people who fuel them. At the start of my career in digital marketing and PR 25 years ago, we always hung on to one age-old principle: to get our audiences off platforms we didn't own and onto platforms, we did own so that we as marketers had better influence over our messages to them because by deepening the relationships with audiences on platforms we didn't own we were essentially making money for someone else, which didn't benefit us or the audiences.

The Tough Reality of Social Media Dependency

Social media platforms have positioned themselves as gateways to success with promises of exposure, monetisation, and the potential to "go viral." This model has turned millions of users into unpaid workers. The lure of social media as a tool for growth is undeniable. We see small businesses showcasing their products to creators building personal brands, but at what cost?

A 12-hour TikTok ban in the United States in the past few days left users outraged and hurt. Suddenly, people who had spent years building their audiences faced the possibility of losing everything they'd worked for, even if just temporarily. This event highlighted many's emotional and financial reliance on these platforms. For small businesses and influencers alike, such disruptions are a harsh reminder of their vulnerability when their livelihoods are tied to spaces they don't control.

This dependency exposes a key weakness: creators and small businesses invest in spaces they don't own. A business can vanish overnight when a social media platform changes its algorithm, introduces new rules, or disappears altogether. The recent backlash also underscores the toll this takes on mental and emotional health as people navigate an uncertain digital landscape. Barrett Pall's reel reminded me of this dynamic. Platforms profit immensely from user-generated content, which keeps their audiences engaged and their ad revenue flowing. Small businesses are particularly vulnerable to these challenges. They often manage social media, unlike larger companies with dedicated marketing teams, budgets, resources, and contacts, enabling them to employ the complete marketing mix. Platforms also operate a pay-to-play model by limiting organic reach, nudging small businesses to pay for ads to reach their audience, disproportionately affecting them due to limited budgets. Rising ad costs, unpredictable results and potential ad fatigue make it difficult for small businesses to compete, leaving them questioning whether social media is worth the investment.

So, what's the solution?

The Power of Owned Assets

One of the most potent steps a business can take is to focus on building and strengthening business assets they own and control. These assets are the foundation of a sustainable and scalable business, and they ensure that your growth isn't at the mercy of ever-changing algorithms or external disruptions. I currently favour three types of business assets, and there are many more!

1. Email Lists: A Timeless Resource

Email lists, the modern evolution of the traditional mailing list, remain one of the most valuable tools for businesses despite the perception that email is outdated. Unlike social media, email offers direct access to your audience, unaffected by algorithms or platform changes. Even if only a fraction of your list engages, these are highly valuable, opted-in, warm leads who have shown an increased interest in your brand.

Moreover, email marketing delivers one of the highest returns on investment compared to other channels. According to a 2020 Data & Marketing Association (DMA) survey, brands earned an average of ￡36 for every ￡1 invested in email marketing. The retail, e-commerce, and consumer goods sectors reported an even higher ROI, with ￡45 earned per dollar spent. This unmatched ROI stems from email's ability to nurture relationships, drive sales, and foster loyalty directly.

It is recognised that the ROI for email marketing is skewed by larger firms with the expertise and resources to run sophisticated, multi-channel campaigns. While lacking these advantages, small businesses can still benefit from email marketing by focusing on strategic practices. These include understanding their audience, creating targeted content, and leveraging affordable tools for automation and analytics. The return can be substantial even if a small percentage of your list engages. With personalisation, segmentation, and automation, businesses can create tailored campaigns that drive conversions and build loyalty. By offering value—such as exclusive discounts, valuable resources, or early access to products—email lists can transform casual followers into dedicated customers, making them an indispensable part of any marketing strategy, especially in business-to-business where decision-makers (who tend to hold the purse strings) in particular rely on email for professional communication.

2. Partnerships and Relationships

Building and maintaining strong partnerships and relationships is a key asset for any business. A well-connected network can open doors to new opportunities and expand your reach, reducing dependence on platforms like social media or paid ads. These relationships can foster collaboration, amplify your message, and create mutually beneficial outcomes. Here are some ideas:

Joint Ventures:

Partnering with businesses with a complementary audience can create unique opportunities, such as co-branded products, shared events, or bundled services. This expands reach, shares costs, and provides access to new markets or resources. One scenario might be a meal kit service that partners with a well-known restaurant chain to create exclusive kits featuring the chain's signature dishes. This collaboration introduces the meal kit service to the restaurant's loyal customers while giving the chain a new channel to engage with home cooks.

Distribution Partnerships

Partnering with distributors or retailers to get your products into stores or other sales channels. This expands your market presence and allows you to leverage established distribution networks without building your own. For a digital course-based business, this could involve hosting your courses on well-established platforms like Udemy or Coursera, allowing their global audience to access your content while leveraging the platform's reach and credibility. This approach enables you to distribute your product without building an extensive audience or infrastructure, and there is a clear value exchange.

Referral Partnerships

Collaborating with other businesses to refer clients to each other, often with an incentive like a referral fee or mutual promotions. This drives qualified leads and builds trust through recommendations from a credible partner—for example, a gym chain partners with a health insurance provider. The insurance provider offers discounts on gym memberships to its customers as part of its wellness programme, while the gym promotes the insurance plans to its members. Both businesses benefit from increased customer engagement and retention while driving qualified leads to each other.

3. Intellectual Property: Your Competitive Edge

Intellectual property (IP) is one of the most valuable assets a business can develop, offering a unique competitive edge that no competitor can easily replicate. It encompasses the ideas, creations, and systems that make your business stand out, and its value often extends beyond the immediate. The correct IP doesn't just differentiate your brand—it can also create new expansion opportunities, drive recurring revenue streams, and significantly increase the overall value of your business. Regarding intellectual property, my favourite examples are those that establish a business's identity and provide innovative ways to grow, adapt, and monetise. Here are my three favourite types currently:

Licensing Agreements:

Licensing involves granting other companies or individuals the right to use your proprietary tools, products, or frameworks in exchange for royalties or fees. You'll need to manage agreements and maintain the value of your IP. Licensing offers an efficient way to scale your business and generate recurring income. It sometimes allows your intellectual property to reach new audiences and markets without requiring direct involvement in day-to-day operations.

Examples:

Courses: If you've created a training programme or certification course, you can license it to organisations, allowing them to teach it under your brand. For example, a fitness coach might license their signature workout programme to gyms or studios and have instructors who also pay to learn the routine and for a licence to teach it in said gyms and studios. Zumba is a prime example of this!

Product Designs: Toiletries are a perfect example of product design licensing or white labelling, particularly for businesses wanting to create branded product lines without developing the products from scratch.

Software Tools: Companies with proprietary software can license it to other businesses, providing them access while collecting subscription fees or royalties.

Franchising: Licensing as a business model, such as in the food or retail industry, enables franchisees to use your branding, systems, and processes for an ongoing fee.

Books: A Tangible and Evergreen IP Asset

Publishing a book is one of the most powerful ways to establish authority, build credibility, and create an evergreen copyrighted resource that showcases your expertise. Unlike fleeting social media posts or videos, a book is a permanent asset that can be sold, referenced, or repurposed for years. Whether it's a business guide, a memoir, or a niche-specific instructional resource, a book positions you as a thought leader in your industry. A book can serve as a lead-generation tool, offering value upfront and funnelling readers into your other products or services. It also opens doors to speaking engagements, media opportunities, and collaborations. Books can generate direct sales income, whether sold digitally or in print. They can also be licensed for translation, adapted into courses, or bundled with other offerings.

Example:

A marketing consultant writes a book called "10 Steps to Overcoming Ad Fatigue," which generates revenue through sales and serves as a lead magnet for their coaching services and workshops. Additionally, they license the book to an international publisher for translation and distribution in multiple languages, expanding its reach globally.

Proprietary Methods, Frameworks, and Tools

Developing unique methodologies, workflows, or tools can set your business apart and establish you as an industry leader. These proprietary assets not only enhance your credibility but also offer scalable opportunities for growth. Proprietary methods and frameworks create a competitive edge by showcasing your unique expertise. They can be licensed to other businesses, providing an additional revenue stream without requiring direct involvement. Furthermore, these tools establish your organisation as an authority in its niche, making it more attractive to potential clients or partners.

One great example of a proprietary framework is Zumba. Zumba is a global fitness brand that turned its unique combination of dance and exercise into a scalable business model. The company developed a trademarked framework for its classes, ensuring a consistent and recognisable experience worldwide. Instructors undergo official training and certification, often paying for subscriptions to Zumba's Instructor Network (ZIN) to remain licensed. Gyms and studios license the Zumba name to offer official classes, and the brand extends its reach through additional revenue streams like branded merchandise, music, and DVDs.

The Zumba model demonstrates how a proprietary system can create a thriving, scalable business. By protecting its intellectual property and maintaining a standardised methodology, Zumba has ensured quality and consistency and empowered thousands of local instructors and fitness centres to participate in its success. It showcases how intellectual property can serve as the foundation for global expansion, recurring revenue, and brand authority, making it a replicable model for businesses across various industries.

Conclusion: Take Charge of Your Future

As the digital landscape evolves, we must rethink their reliance on social media platforms and the broader "creator economy." While these platforms offer undeniable opportunities for visibility and engagement, they come with significant drawbacks. Barrett Pall's reel is a powerful reminder to question the systems we contribute to and prioritise building sustainable, independent growth.

Whether you're a creator, a small business owner, or an employee navigating the complexities of today's digital economy, the path forward lies in staying informed, adaptable, and strategic. By empowering yourself via your assets, nurturing authentic relationships, and leveraging scalable systems, you can reclaim your time, energy, and resources to build a business that thrives on your terms—not those set by a platform. The creator economy is changing— my call to action here is for you protect yourself.

The tools are in your hands. By building assets you own and nurturing authentic partnerships, you can future-proof your business.