Author: Scott Guthrie | #074 | 21 September 2022

Welcome to the Fourth Floor newsletter, your weekly feed of the biggest news, developments, insights, and analysis from the ever-evolving world of influencer marketing.

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YouTube Shorts creators to share ad revenue … but it won’t be 45%

The big news this week for content creators is that YouTube will start monetizing YouTube shorts next year. Importantly, Shorts creators will get to keep a big slug of the revenue generated from their Shorts viewership. Many headlines reporting YouTube’s new rollout say creators get to keep 45% of the revenue. But, that’s not fully accurate. Here’s what YouTube wrote in its announcement:

“In Shorts, ads run between videos in the Shorts Feed. So, every month, revenue from these ads will be added together and used to reward Shorts creators and help cover costs of music licensing.

From the overall amount allocated to creators, they will keep 45% of the revenue, distributed based on their share of total Shorts views. The revenue share remains the same, no matter if they use music or not.”

So, rather than creators keeping 45% of revenue what’s actually happening is that all of the money generated by ads on Shorts gets pooled together. It's then sub-divided. Creators get one pool. Music labels the other. Shorts creators benefit from receiving 45% of the creator pool but 0% of the music pool, and YouTube doesn’t detail the size of that pool. In other words, Shorts creators receive 45% of revenue AFTER music licensing fees have been deducted, but YouTube is yet to say how much music’s cut is. Hank Green has more detailed thoughts on the real ad revenue deal. Once the new revenue share model kicks in, YouTube will end its $100 million creator fund, too.

Patreon's deals with top TikTok creators flopped

Insider reports that Patreon paid two TikTok creators over $1.3m each. The payback? Patreon expected one creator, Larri "Larray" Merritt to drive $100,000 in subscriptions in his first month on the platform. The comedy creator reportedly brought in just $2,217 in total membership volume, which refers to total payments from fans.

The other creator, Chase "Lil Huddy" Hudson was expected to produce $25,000 in new Patreon subscriptions. However, he generated only $2,670.

Viral Nation acquires MediaKits

Viral Nation has acquired MediaKits, a tool used by creators to build cross-platform digital resumes with real-time data to drive monetization. MediaKits offers data and analytics reporting important to tracking ROI from brand relationships and sponsorship deals. Viral Nation plans to integrate MediaKits into its own tech platform. The acquisition size was not disclosed.

Input shuttered

This week we lost another important title which covered online culture. On Monday, Bustle Digital Group said tech title Input would close that same day. Input staff will either be laid off or offered new roles at BDG properties. A few weeks ago (in newsletter #72) we reported that Real Life, the magazine about living with technology - which provided cerebral digital column inches about the creator economy and more - had suddenly shuttered.

Nielsen measures brand recall from influencer marketing

Nielsen conducted over 1000 studies on podcast advertising, branded content, and influencer marketing, to help marketers in two ways:

  1. Gauge the size of impact these channels have on brands

  2. Propose ways to measure impact that will work for a range of budgets

Nielsen found that with each of the three channels, the average aided brand recall is over 70%, and the average advertiser brand sees gains in familiarity and affinity through the exposure. Influencer marketing yielded an 80% aided brand recall. By measuring consumers’ reception of the content, Nielsen found that highly engaging content can drive big gains in purchase intent, and deliver impressive ROI.

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BeReal, the copycats, and avoiding ads

BeReal wants to avoid serving up advertisements to its users, by opting instead for in-app payments in return for extra features. DAU (daily active users) have spiked to 15m from 10k in around a year. This stellar user growth hasn’t gone unnoticed by competitors. Instagram was first off the blocks to introduce copycat features. In July it added a “Dual Camera” feature that takes a photo combining images from both the front and the back camera. In August, Instagram tested IG Candid Challenges - a feature that challenges people to post candid photos within two minutes.

Snapchat also launched a “Dual Camera” feature last month for iOS users on iPhone XS/XR or above (Android users will have to wait - as per).

Earlier this week, TikTok launched TikTok Now, its BeReal clone with a new take on security. Users must be at least 18 years-old to share their TikTok Now posts in the Explore feed. Like TikTok-main, under-16 accounts will be set to private by default, and even for 18+ users, the standard setting will be friends-only viewing.

According to the Financial Times, BeReal’s core product will remain free to access, but the platform is weighing optional paid-for extras. No paid features are likely to launch before the second half of next year.

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→ Over the past three years, YouTube has paid creators, artists, and media companies over $50 billion [YouTube]

→ YouTube Shorts receives over 30 billion daily views [YouTube]

→ YouTube Shorts has 1.5 billion monthly logged-in users [YouTube]

→ This week in 1984, Miami Vice hit TV screens in the US. To celebrate, Twitter user The Sting squeezed 60 Miami Vice guest-stars into a two-minute video

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Boohoo and Patagonia’s very different approaches to championing sustainability

This month, two very different clothing companies took two very different approaches to championing sustainability. The decisions will, no doubt, be dissected for years to come in case studies reflecting purpose-led organisations.

First up, fast-fashion firm Boohoo recruited Kourtney Kardashian as its “sustainability ambassador”. Kourtney is apparently so used to a private jet lifestyle that last month when she took a commercial flight with her husband Travis Barker, it made headline news.

Kourtney was also in ‘hot water’ last month over the use of her domestic water. As Southern California sweltered under a third year of water restrictions caused by punishing drought, Boohoo’s new sustainability Czar was issued with a “notice of exceedance”, showing she’d used over 150% of her monthly water allowance at least four times since the agency declared a drought emergency at the end of last year. To give you an idea of the size of magnitude of the overuse, in June she exceeded her water budget by about 101,000 gallons, according to the LA Times.

“When Boohoo first approached me to collaborate on a line, I was concerned about the effects of the fast-fashion industry on our planet,” Kourtney told WWD. She continued: “I’m grateful for the opportunity to use my platform to drive conversations that lead to ongoing change and use my voice to share actionable tips with consumers on how we can play our own part.”

At the other end of the spectrum, step forward Yvon Chouinard, the billionaire founder of the outdoor fashion brand Patagonia. Chouinard has given away his company to a charitable trust. All future profit not reinvested in running the business will go to fighting climate change.

"Earth is now our only shareholder," runs the headline on Patagonia’s homepage.

Before the transfer of ownership into the charitable trust, the shares of Chouinard, his wife, and two adult children were valued at about $3 billion.

As we stare down the barrel of a cost-of-living crisis, I don’t want to compare the price-point of Patagonia clothing with Boohoo’s prices. Patagonia products are around x10 more expensive. The point is rather to examine deeds, not words.

The Kardashian / Jenner family has form in tone-deaf, supposedly purpose-led campaigns. When Kendall Jenner handed that policeman a can of Pepsi, ‘averting a race riot’ in the 2017 soft-drink advertisement, we were outraged. We were outraged because the Kenner activation felt, at best, forced. At worst, it trivialised the Black Lives Matter movement. Kenner was not known for her moral crusades. Pepsi did not have any equity in the Black Lives movement. Though the ad was beautifully produced, ultimately it presented as bandwagoning, like Pepsi was attempting to ride the wave of standing for something - profiting in the process - without demonstrating any belief or passion for the cause.

Actions and words must be consistent. They are the foundations on which trust is earned. To paraphrase Kate Hartley, writing in her book ‘Communicate in a Crisis’, in order to communicate with empathy you first have to have empathy. Patagonia consistently manages this. We can only wait and see what happens at Boohoo.

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