What is the new influencer economy?
Social media influencers are now a global phenomenon. Although they have been disrupting the norm of marketing communication from day one, the Covid-19 pandemic, shutting down physical stores and offline events while increasing people’s screen-time, has taken the trend to the next level. Influencers have now become pillars of brands’ marketing plans and key players of the new economy.
This new influencer economy and ecosystem has created new business segments such as paid knowledge, livestreaming tipping and gifting, IP authorization, professional influencer training, influencer content analysis and specialized supply chain. The new influencer economy forms a novel value chain at its dawn, interconnecting various business sectors while presenting a huge market potential.
China’s new influencer economy market size: estimated to reach over 1,000 billion USD by 2025
China has been the global front-runner for influencer marketing and unsurprisingly, it is now taking the lead in building up the new influencer business ecology.
According to the National Bureau of Statistics of China, the direct market sizes of China’s new influencer economy from 2018 to 2020 were 38.5 billion, 96 billion and 210 billion USD respectively, doubling each year. It is estimated that by the year 2025, the total market size of this new value chain will reach approximately 1,035 billion USD.
The figures might seem astonishing to some, however, it does not come as a surprise once we look closely at China’s current influencer market landscape. According to media data agency TOPKLOUT, in 2020 there are more than 9 million influencers in China with a fan base of over 10,000 followers – this is more than anywhere else in the world and the number keeps climbing. Last year, the average number of daily posts published by these influencers was 37.5 million.
Influencers are also delivering strong sales results. During this year’s online shopping festival 618, eight influencers achieved a gross merchandising value (GMV) of over 100 million RMB (~15.4 million USD) individually through the Douyin (Chinese version of TikTok) livestreaming channel alone. The Chinese influencers are creating organic and brand-endorsed content that covers a wide range of sectors from beauty, fashion, food & beverage to education, technology and even finance.
Strong support from the Chinese government
The Chinese government is well aware of this influencer trend and has incorporated the new influencer economy as part of the country’s long-term development plans. In recent years, a series of fiscal and regulatory policies have been introduced by institutions from the state council to local governments to facilitate the continuous growth of this new business ecology.
In June 2020, the China Advertising Association issued the nation’s first code of conduct for livestreaming e-commerce, providing legal guidelines for the industry with a focus on protecting the interests of consumers. A number of regional governments including Shanghai, Guangzhou, Shenzhen and Hangzhou all followed up by setting specific goals for the new influencer sector.
Guangzhou, for example, is aiming to launch over 100 high-quality influencer marketing agencies and bring up 10,000 top-selling livestreaming influencers in the coming few years. Heilongjiang, a Northern province of China, has passed a three-year development plan for the influencer livestreaming sector as part of its economic revival strategies.
Perhaps the most telltale sign of the government’s strong support for the influencer economy, is Chairman Xi Jinping’s visit last year to Jinmei, a small village in Central China. There he set foot in a local e-commerce livestreaming booth where villagers were busy selling local agricultural goods. Their hero product – a kind of black fungus – was sold out immediately after Xi’s visit.
One new business model on the rise: TicToc Ventures’ 360° IPAC model
The thriving new influencer economy creates new business models. Amongst these new models, TicToc Ventures’ 360° IPAC model aims to empower influencers by maximizing the potential of their own brands. Utilizing our expertise in influencer marketing strategies, e-commerce, product development, manufacturing and consumer insights, we create success stories with our clients through a complete and tailor-made brand value chain.
About TicToc Ventures
TicToc Ventures is a one-stop incubator and accelerator for influencer brands. The company aims to unleash the full market potential of influencers by helping them launch collections and brands under their own names, transforming influence to tangible and scalable impact. Having full access to Aventura’s and Belton’s resources and industry expertise, TicToc Ventures creates a sustainable growth model by providing influencers one-stop integrated services that include financial planning, business and brand strategies, product design and development, marketing and e-commerce, community strategy, supply chain management, customer support and logistics.
To get more information about TicToc Ventures, please visit: https://tictoc.ventures/.