🗞 What's New: What happened to the creator economy?

Two years ago, "the creator economy" was all anyone talked about:

• So, what happened? Well, the only players who succeeded are those who focused on creators or products that big tech ignored.
• Newsletter ads can be expensive, but they usually provide high-quality leads and conversions. Just make sure the audience is a great fit.
• From 0 to 1K downloads in 5 weeks with no marketing. Here are the Slack, Reddit, and LinkedIn communities that Rupal Saini tapped into.

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by Evan Armstrong

In May 2022, I argued that we were about to enter a creator economy winter. The response to that original post was pretty heated. But, over a year later, here we are.

What happened?

First, creator economy funding crashed. Investments are down 86% overall, and over 90% in Q1:

Next came the layoffs. Patreon laid off 17% of staff, Linktree sacked 17% of staff, then a few months later, another 27%, Substack laid off 14%, and so forth. And these are the giants. I'm now hearing whispers of multiple creator economy startups quietly shutting down.

In my opinion, the creator economy thesis fell apart because investors had a fundamental misunderstanding of what risks they were underwriting.

Creators themselves are bad business.

What is a creator?

Small businesses typically fail.

A media company is also a bad investment. In 2022, media stocks had their worst decline in 30 years.

A creator is a small business that is also a media company. Double whammy.

Who has succeeded?

The real winners of the creator economy are those who aggregate attention and advertising. YouTube hit $29B in revenue in 2022. The companies who capture the majority of the value are the ones selling things all creators need: Distribution and monetization (Google, Facebook, Twitter), or creation technology (Apple, Sony).

The most successful creator economy startup is OnlyFans. OnlyFans won because it gave adult entertainers a platform to monetize their work. This was a case where the big existing platforms wouldn’t work with them, but there is enormous consumer demand. OnlyFans offered distribution and monetization all in one place. Its last reported earnings hit $433M.

The startups that have scaled are the ones that support creators or products that big tech hasn't bothered to care about (yet). It is in the margins, the niches of monetization that these companies have succeeded: OnlyFans (porn), Substack (subscription newsletters), Kajabi (courses), etc.

Yes, the creator economy has its own challenges that make it a particularly tough market to compete in. But it’s not unique in this regard. Every venture-backed sector has a 99% failure rate.

Like most industries, there will be a few big winners that manage to persist. It turns out that the creator economy is real...it was just already well served by existing providers!

Discuss this story.

from the Growth Trends newsletter

🧵 Twitter is blocking links to its rival, Threads.

📱 Mastodon hit 2M active users this week.

🎯 Best practices for LinkedIn retargeting.

🏛 This new law may cause social media shutdowns in the EU.

📜 Check out the world's oldest content marketing campaigns.

🛠 Convex has everything you need to build your full-stack project. #ad

Check out Growth Trends for more curated news items focused on user acquisition and new product ideas.

by Darko

Emanuel Cinca, founder of Stacked Marketer, a daily marketing newsletter, is giving the details on the pros and cons of running newsletter ads!

How do newsletter ads compare to social media ads?

They are high-intent, even though certain targeting features aren’t available. In general, newsletter ads tend to be more expensive, but provide higher quality visitors who are more likely to convert.

The important part is making sure to advertise in the correct newsletters for your target customer.

What's the top objection to running newsletter ads?

People aren’t used to the fact that they can’t just spend $50-$100 to target someone who is based in a certain neighborhood of New York who likes dogs. So, they often try to associate it with the type of advertising you do on paid social and search.

Common objections will come from that, usually things like:

• Your minimum recommendation is higher than my test budget.
• I only want USA.
• I only want segments that make $50M per year.

Do newsletter advertisers come back after the first time?

Yes, it’s common to have regulars!

It’s not uncommon for 33-50% of available slots to be booked by returning sponsors.

What is the biggest reason advertisers don't return?

1. The audience is not a fit. They test it out, but it just doesn’t fit with their ICP (ideal customer profile).

2. Brands are bad at following up. They expect that, after someone sees their ad, they instantly become a customer. This only works for free or extremely cheap products that are impulse buys. Business decisions have a longer timeline, yet many brands have a convoluted and undefined sales process, so they don’t close leads.

What's the expected CTR and CPC?

Let’s first make sure we have the same definition of CTR: Unique clicks divided by the total number of recipients.

Secondly, the size of your newsletter matters a lot. The smaller it is, the more likely it is to have a higher CTR, and the more likely that your audience is made of superfans that engage with everything.

CPC depends on what you’re targeting. Let’s assume it’s an audience with at least 70% US, CA, UK, and EU. In this case, if it’s mainstream and broad, you can get around $1 CPC, maybe even lower.

What's the biggest mistake made by newsletters when it comes to ads?

Unclear quality of readership. Properly cleaning your newsletter subscriber list is vital.

Discuss this story.

💡 I need an idea to pursue. Posted by Mask.

🧐 How did you get your first customer? Posted by Sherleen Djarum.

🙋‍♀️ One-person business stories. Posted by AJ.

🤖 What are you building with GPT4? Posted by Darko.

💻 Getting stuck on URL structure. Posted by Min Zhou.

💪 My SaaS is finally going into production. Posted by Augusto Oliveira.

Want a shout-out in next week's Best of Indie Hackers? Submit an article or link post on Indie Hackers whenever you come across something you think other indie hackers will enjoy.

by Rupal Saini

We recently launched our MVP, Truebase: ChatGPT Email Generator, a free Chrome extension that generates personalized emails based on a business prospect's LinkedIn profile page.

We hit ~1K downloads in five weeks with no marketing! Here's how.

Product Hunt launch

We launched on Product Hunt on March 29. It was our first launch, and we had limited knowledge about the platform. We only planned for 3-4 days, and shared the launch on our social media platforms, including LinkedIn and Twitter.

Our extension made it to the 12th product of the day, and we received demo signups for our main product, Truebase, an AI-powered sales prospecting tool. Additionally, we gained ~190 downloads from this launch.

Effective communities

After the Product Hunt launch, we focused on increasing awareness about our extension in online communities. This significantly helped us reach our target audience, as we chose communities where they actively participate.

On Slack:

1. Belkins B2B Sales and Marketing Pros.
2. Revgenius.
3. RevOps Co-op.
4. Product school.

On LinkedIn:

1. Product Hunt Upvote and Promotion.
2. Wildtools.
3. Prompt Engineering for ChatGPT, Midjourney, Chatbots, and AI Tools.
4. ChatGPT Network.

On Reddit:

1. r/chrome_extensions.
2. r/productivityapps.
3. r/buildinpublic.
4. r/indiehackers.

Be careful not to post the same content in multiple subreddits, as Reddit moderators are highly strict. If they discover such duplication, they will promptly cease displaying your post to users.

Now, turning to directories, they worked like magic for increasing installations for our Chrome extension. Since our extension is ChatGPT based, we promoted it on AI tool submission directories. I also emailed several directory administrators. The open directories performed exceptionally well for us.

Here are few directories that helped greatly:

1. Chatgptdemo.
2. Toolscout.
3. Foundr.

Hope this helps!

Discuss this story.

by Tweetmaster Flex

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Special thanks to Jay Avery for editing this issue, to Gabriella Federico for the illustrations, and to Evan Armstrong, Darko, and Rupal Saini for contributing posts. —Channing