For much of the early 2000s, a simple webcam was all you needed to make money online. You’d log on to websites like UStream, HitTern, and live.com and use your webcam to stream video of yourself either talking or playing games. People would pay to have conversations with you, give you advice, or watch you play games. It was a simple and straightforward way to make money online, and hundreds of thousands of people made a living from it. It was a golden era for webcam performers who could supplement their income with additional side gigs.
However, the ecosystem of online content has changed since then. Most notably, the widespread availability of video-encoding software like Handbrake, and the rise of TikTok have shifted the economics of online video. Now, to make money online, you don’t necessarily need a webcam – you just need the tools to create and distribute viral content.
The Rise of TikTok
If you’re reading this, chances are you’re already aware of TikTok. It’s one of the most popular social platforms among millennials with over 500 million monthly active users. What makes the platform so special is that it combines social media with live video – basically, everyone on the platform is broadcasting live video at the same time. This provides an opportunity for creators to reach a massive audience quickly and easily.
The result is that many traditional advertising industries are being disrupted. While most social media platforms rely on advertising to fund their operations, the economics of advertising on TikTok are changing. It’s no longer enough to just attract users to your platform – now you need to keep them engaged with your content.
Distributing Video: Snapchat, Instagram, and TikTok
One of the best ways to engage with and retain users on your platform is to provide content that is only available to a small group of people – it creates a sense of exclusivity that is both valuable and appealing to today’s internet user.
The platform creators of today are focusing more on distribution than building huge followings, as it is so much easier to reach a massive audience with content that is only available to a few – whether that’s an exclusive album, an immersive music experience, or a comedic video series.
Snapchat is one of the most popular social platforms among adults aged between 18 and 24. It is most well-known for its ‘stories’ – individual clips that users can scroll through and hit “enter” to watch. But perhaps the most innovative aspect of Snapchat is its quick-to-access frontpage, ‘Discover’ – here, users can see the most popular content curated from various apps and creators.
Instagram is another hugely popular social media platform, even more so among Gen-Z. It is the third-largest social network in the world and one of the most effective platforms for marketing, branding, and gaining support from organic and paid followers.
What is interesting about the Instagram model is that it provides an opportunity for creators to become extremely popular without having to spend lots of money on advertising or sponsored content – the platform provides the tools for viral content, and lots of it! For example, the creator Tatiyana Fatsis built a following of over a million people on Instagram with just a few short and snappy videos that show her dancing and singing.
TikTok is, in many ways, the culmination of everything that came before it. It is the most popular social platform among millennials and it provides a place for creators to rapidly distribute their content while also having an audience. It is very similar to TikChat, which was originally created for smartphone users in Indonesia in 2004 and then globally released in 2010.
TikTok allows users to customize their home feed with different content types. These include regular shows, which feature a host talking with various experts about a variety of topics; themed shows, which focus on a specific topic like fashion or beauty; and standalone videos, which are similar to stories but lack the ability to add other content.
What is interesting is that all of these video platforms, whether old or new, serve a similar purpose: getting content in front of as many eyeballs as possible.
Traditional Advertising Specialties Are Being Disrupted
Odds are, you’re reading this on TikTok right now. It’s the most popular social media platform among Millennials and Gen Z, and it provides a place for creators to quickly distribute content.
As video platforms have become more accessible and user-friendly, media companies have sought to find new ways to monetize video. Over the last few years, traditional advertising specialties like TV commercials and print ads have declined, especially as many people now get their video content for free on social platforms like YouTube.
While TV commercials are still prevalent, online commercials are taking over. In fact, online commercials now account for 86% of all commercials aired in the U.S. According to HubSpot Blogs research, 68% of today’s consumers say they often come across ads while browsing social media sites like Instagram and TikTok – and millennials and Gen Z are even more likely to be influenced by online advertising than the general population (89% and 83% respectively).
What is interesting is that while advertisers may still want to reach a massive audience, they aren’t necessarily looking for a one-to-one relationship with their audience. In the past, advertisers would create TV commercials with the intention of appealing to as many people as possible. However, with over 500 million monthly active users on TikTok, creating a commercial with the sole purpose of reaching a small group of people can be quite lucrative – especially if that group is well-known for being passionate about a subject.
The Future of Online Video
This brings us to the crux of the problem: platforms like TikTok (and the others mentioned above) provide a valuable service to content creators by making the distribution of their content easy and accessible. However, this also provides an abundance of easily digestible content for everyone – which might lead to a decline in traditional advertising revenues. It might even lead to the demise of conventional TV advertising completely.
With the rise of the ‘influencer’ and the ‘micro-influencer’, a new form of viral marketing has emerged. While traditional advertisers may still want to reach a massive audience, it no longer suits their needs to do so – they are now turning to smaller platforms like TikTok to find content creators who can help them achieve that goal.
As video platforms continue to evolve and provide more diverse ways to make money, it is becoming less reliant on just a few platforms like YouTube and Facebook – which, for the most part, host the majority of the world’s video content. This is opening up the door for smaller platforms to emerge, which host only a tiny fraction of the content compared to their peers.
Even if you’re experienced in video marketing and advertising, it’s not easy to predict what the future of video will look like – especially since so much can change in the future.