Social media stars turn 'likes' into cash

Social media stars turn 'likes' into cash

Social media stars turn 'likes' into cash

If you’ve ever shared a filtered photo of your plate of noodles; seen a six-second Vine clip spread on Twitter; or wondered what a teenager is doing on Snapchat, you’ll know a bit about the popularity of these social mobile apps. You may be more surprised to hear that some of their users are making good money from the photos and videos they share. In fact, an emerging wave of ‘social influencers’ on these and other apps and services — from YouTube to Pinterest — are emerging as one of the advertising industry’s great hopes for reconnecting with the young people who are watching less and less live TV.

It’s startling that someone who you have never heard of can earn tens of thousands for posting a promotional Instagram or Snapchat snap featuring a product or brand but what is just as interesting is the way these apps are creating a new kind of star. There is a whole ecosystem building up around these new social stars: talent agencies who spot rising stars, sign them up, then help them make money from their audiences of tens or hundreds of thousands, or even millions. 

Those audiences have been built follower by follower on social networks, but often remain unknown to traditional media — at least until they emerge, fully-formed with those audiences sending their books (Zoella), songs (Shawn Mendes) and mobile games (PewDiePie) to the top of the charts, causing a confused scramble to explain their           popularity. 

“The social media stars of today: they are real, honest. Their sharings are often unedited, unpolished. And you get the feeling you are seeing the person ‘as they are’, warts and all,” says Natasha Courtenay-Smith, a digital strategist, who has worked with several social stars. 

“These content creators are often seen to be more similar, relatable and approachable in the eyes of the target audience than more mainstream A-list celebrities,” says Hayley Cocker of Lancaster University Management School, who has studied celebrity identity myths. “The stars are being headhunted: there are talent agencies popping up to get anyone who has over 100,000 followers on a platform,” says Jason Barrett, who runs the agency Social Talent, which manages a range of these creators. 

US firm Delmondo focuses on Snapchat, for example, while another, Dash Hudson, is more about Instagram. In the UK, Gleam Futures came to prominence with its roster of YouTube stars — Zoella included — but now sees them diversifying. “You could call them ‘social talent’. Except soon they’ll just be called ‘talent’,” says managing director Dominic Smales. 

The point that all these agencies make is that these social stars are far from talentless: they didn’t luck into their large audiences within social apps. “For a large percentage of the people you would call influencers, they’ve just been creating great content because that’s what they love to do, and people gravitate towards them because of it,” says Thomas Rankin, chief executive of Dash Hudson. 

“They understand the medium: how to respond to people and how to create a really interesting story,” says Nick Cicero, chief executive of Delmondo. Bartlett talks about a notional campaign where a car company selects three YouTube vloggers to send on a road-trip in its new model. “With two or three vloggers, it would depend on who they are, what their audience is, what their content is like, and the production values,” he says. “You could do something like that for £1,000 or for £100,000.” 

Social stars do influence youth

Why do brands want to work with these social stars? At one level, it’s simple: they have large, highly-engaged followings in exactly the demographic group —young, affluent millennials — that the advertising industry is chasing beyond the traditional 30-second TV commercial. 

Smales is the most sceptical on the subject of brands and social stars, perhaps because his most popular clients are finding ways to sell their own products rather than promote those of other companies. However, Cocker notes that many social stars are understanding that the power of their own personal brands can be used to launch their own products, rather than simply promote those of companies. 

PewDiePie has released his own mobile game that topped the app-store charts, while Michelle Phan founded a makeup-delivery company called Ipsy which recently raised $100 m of funding.   

Cicero says that what’s changing is the very definition of mainstream media. “The entertainment industry is changing. In one year’s time, television is just another app. Where creators are now saying ‘check me out on Vine or Snapchat’, in a year from now they’ll be saying ‘check me out on NBC’. Vine is an app you download, Snapchat is an app you download, and NBC too is going to be just another app you download,” he says.
 
Brands and stars’ association 

As more social stars work with brands, so the debate about how they should disclose these relationships to their audiences has grown. Disclosure can be as simple as a hashtag like #ad or #spon (for sponsored) in a tweet or Instagram post, but clear standards are yet to emerge.

In the US, in August, the Food and Drug Administration forced an Instagram post by Kim Kardashian promoting a morning-sickness treatment to be deleted, because it did not include information on the drug’s risks. 

“A brand has to ensure its marketing communications are ‘legal, decent, honest and truthful’ and its marketing communications are ‘obviously identifiable as such’ and these rules will likely apply to materials using the route creators on social platforms,” explains Andrew Joint, commercial technology partner at law firm Kemp Little. “This of course means different things on different platforms – hashtags on twitter (#advert) to different labelling on Instagram or visual/audio on YouTube. It really is a question of common sense and a general sniff test. The question is ‘Would someone know this is marketing material?’ and the answer needs to be ‘yes’.”  

“I think we are moving towards a world where there’s much more clarity around what is sponsored and what is not — and around what ‘sponsored’ actually means,” says  Dash Hudson’s Thomas Rankin. “That’s because this is now becoming a significant component of the advertising and marketing business, and that’s a business that is regulated. What’s missing outside regulation is really best practices. But we’re going to see those evolve. It’s hard to imagine people aren’t aware products are being placed. What is problematic is when it feels deceiving, and I think there are circumstances where that’s occurred.” 

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