Psychology behind Passion Economy

by Rajan Gupta

According to Li Jin, we’re in the process of the ‘unbundling of work’ in which many are moving from companies to independent sole proprietor businesses.

Caitlin Dewey, a reporter at The Buffalo News, called it the Hustle Economy, “an online labor market in which platform-dependent workers create and monetize their own digital products”.

Creator economy, also called the passion economy, is the class of businesses centred around independent content creators, curators, and community builders plus the software and finance tools designed to help them with the growth and monetisation. Creator Economy is estimated to be $15B with 50 M creators or per capita income of $300 per creator. The critical question we need to answer is how big it can become in the next 10 years? Is it a temporary change which will fade away soon or is it a fundamental shift? 

To answer this we need to understand the underlying psychology and economics behind the Creator Economy. This will give us some insight into why will creators join the ecosystem and why will they stay. Also give us some sense of how many people can make a living from passion economy. In this article let’s understand the psychology behind the passion economy or motivations of creators. In the next article we will cover the economics of it.

Maslow’s need hierarchy theory has brilliantly explained — why people do what they do and why they behave the way they behave over the years. Let's see how Maslow need hierarchy framework would apply to Passion Economy creator.

Physiological Needs

Salary — (traditional employees) live for monthly pay cheques which takes care of all their physiological needs like food, water, shelter, clothing etc. Employees throughout their careers try to optimise this cheque.

Income — (Creators) believe in their passion and make the best efforts to convert their passion into livelihood. According to a study of nine digital platforms 17 million Americans earned nearly $7 billion in income from their independent creations in 2017.

The average person now spends almost three hours per day using social platforms. If given a choice, consumers would prefer long-term, passion-driven connections and content, instead of the short-term, meaningless interactions that are dominant on social media. These meaningful conversations are made possible by creators and consumers acknowledge this. Passion economy provides creators with a direct line to connect, transact and share experiences with fans. For fans the individual providing product or service is more important than the product or service itself, opening up the opportunities for creators to make money.

Also to be a successful creator you don’t need millions of fans. You don’t need millions of dollars or millions of customers or millions of clients. To make a living as a craftsperson, photographer, musician, designer, author, animator, app maker, entrepreneur, or inventor you need only thousands of true fans according to Kevin Kelly (former Wired editor), on platforms like YouTube, Instagram, Snapchat, Twitch, Twitter, TikTok, Substack, Patreon and Linkedin.

Safety Needs

Work conditions and job security — (traditional employees) need safe and comfortable work space, job stability and manageable work stress. 

Flexibility — (Creators) on the other hand aspire for flexibility to work when they want to, and work from where they want to. Flexibility to choose work days and off days. The flexibility to define the work conditions, and change them when they want to.

Belongingness Needs

Cooperative colleagues and supportive bosses — (traditional employee) dream for bosses who are supportive and sensitive. Colleagues who are cooperative and make them feel loved and respected. Employees hop jobs in search of the right gang till they realize this is something not in their control and they can't optimize for it.

Community — (creators) are leaders of the community, community of fans, their fans, which they have built with hard work and sweat. Community which connects with them and stands for them. Community which respects them and love them for who they are. Community which shares passion with them. This love and trust help creators forge long lasting true social relationships. Creators fully control the community and also control who they work with and who they work for. Creators thus are more at peace with themselves and their environment.

Esteem Needs

Brand value of employer, recognition for work — (traditional employee) looks for brand value of employer for their esteem needs outside workplace that is in their social circle. And recognition for work for esteem needs at workplace.

Recognition as an influencer, domain expert, as an entrepreneur — (creators) get recognition as influencers, experts and entrepreneurs. This is a privilege hitherto restricted to a chosen few before the passion economy. Now, the internet has democratised this opportunity. Also it's not one time zero or one kind of event. As a creator builds the community, the creator starts getting the acknowledgement from the followers. This acknowledgement further fuels the fire to do even better for the fans.

Self Actualisation Needs

Become a domain expert — (traditional employees) don't pursue this goal in the majority of the cases. Maybe less than 2% of traditional employees might play this game to be the best in the trade. Most of the traditional employees are always running after lower order needs and trying to catch up with their goals directed toward deficiency needs.

Freedom of expression, Individuality, Purpose and Empower others — (creators)

Freedom of expression 

In the modern age, self-expression is so integral to our existence. We identify ourselves by what we believe in, what we stand for ,what we do and how we spend our time. If you take a conventional job where you’re employed by somebody, you can’t actually be yourself. There is no place for freedom. Creators are artists who love to express themselves with their content, with their creation.

Individuality

Passion Economy way for individuals to believe in their skills and individuality. Whether it’s playing video games, running gardening classes, or selling niche fashion items. Individuality is not ironed out in creators economy like in traditional economy. Individuality is worshipped. Individuality is what connects a creator and audience. Unique style, unique experiences and worldview. This uniqueness is what followers love the most about creators they follow. This uniqueness is what fans pay for.

Purpose

People are always dealing with questions — why should they show up at work today? Are they making any difference? Will I be content with my journey on my deathbed? They want to do something that has a purpose that can make a difference. That can take the community forward. Creators strive to bring that change through their content.

Empower Others

Compassion, Empathy, selflessness and care for fans. The need to see other people become as good as you are in the particular skill. The need to positively improve the lives of followers. The need to make your followers the future creators.

Passion economy operates from higher order needs and gives more satisfaction and fulfilment to creators. Experience of the fulfilment and contentment that follows when higher order needs are gratified, this fulfilment feeds the soul and pushes creators when the road is rough, when fans are few, competition is high and the income is zero. These higher order growth needs are what ensures that the creators who join the ecosystem stick around till the taste of success.

Helping people work on cognitive, aesthetic, self actualisation and transcendence needs and achieve them at scale is one massive achievement of startups and technology. It will make the world more passionate.

Once we move towards higher order needs and achieve them there is no going back. It’s an irreversible process. And the way passion economy works it will ensure that the change is not limited on the top. But benefits percolate down and pull others up. I have no doubts that we will see 500 M creators in the next 10 years. 

In the next article we will see what is economics behind the passion economy, why it will change everything we have seen so far. In the next articles in the series we will cover Challenges faced by the Creator Economy globally, Creator Economy in India and Opportunities in the creator economy. Follow me on Linkedin or Twitter so that you don’t miss my next article. Feel free to email me or message me if you would like to discuss creator economy or have a different take on it.