As the Creator Economy Booms, Adjacent Ad-Tech Firms Struggle to Stand Out

As the creator economy space continues to swell, more brands are looking for creators to boost their products. For Ivonnie Dulce, group director of social at agency Nexstar Digital, that means a deluge of emails from creator-focused ad-tech companies. “I just give them my fake email,” Dulce said of creator-adjacent startups that approach her and don’t fit her needs. A cottage industry of startups has risen to meet the needs of the creator economy, including those dedicated to helping brands connect with creators. These range from more traditional public relations and talent agencies to self-serve software platforms. A non-exhaustive 2021 list from market intelligence company CBInsights counted 153 creator economy startups, including 27 ad platforms, which had alone raised over $250 million in funding. Known names in the space include Influential and CreatorIQ. Because of the sheer number of startups in this space, sifting through them to find the value-adds is a task. “Every other day, I get a new tracking platform that is popping up,” said Porsha Ellis, managing director at creative agency Crown + Conquer. Can TikTok Cut Out the Middle Man Between Creators and Brands? These companies are playing a role in filling advertisers’ needs, as influencer marketing has moved from the experimentation line to more of a budget priority. In fact, marketers using influencer marketing are estimated to rise to 72.5% in 2022, up from 55.4% in 2019. But not all creator marketing platforms are created equal. Many platforms call themselves tech startups, but it's not their technology that makes them attractive to marketers. Rather, as industry experts shared with Adweek, it's the more analog services they provide, like relationship management and media delivery, especially as the tech itself is often dependent on platforms. Seeking white-glove services As the creator economy began taking off at the beginning of the pandemic, marketers needed data to prove the value of investing in influencer partnerships, said Ross McCormack, vp director of social strategy at Havas Media Group. Now, marketers are looking for more than just data from an ad-tech partner. “We need a really skilled team to execute this work for us,” he said. “Now instead of focusing on the tech, [we ask] ‘Do we have a strong team to get these campaigns live and be successful?’” Dulce at Nexstar Digital relies on NeoReach, an influencer software platform that provides white-glove services. NeoReach’s vp of agency services Jessica Waxer picks the influencers for a campaign, negotiates their contracts, and ensures the media is created and edited. Dulce then sends the campaign to the brand once it's complete, making the process much more efficient than working with a self-serve software platform. One catch of letting influencer platforms handle all negotiations is that brands lose some leverage in deciding rates, McCormack said. The industry standard is to pay a package price for a group of creators, rather than know their individual rates, making it harder for marketers to evaluate the effectiveness of that relationship. Tech itself can lack scale and substance Marketers are looking for quality service to differentiate influencer platforms, as the tech itself is often lacking, sources said. If marketers are relying on a creator software-as-a-service platform—instead of the expertise of an agent or rep—they need a large, diverse pool of creators to sort through. Many platforms lack this scope, said Winterberry Group management consultant Gayle Meyers. “You have to get the creators at that vertical, and then you have to get the product to that creator. They have to be scaled across platforms,” Meyers said, noting that creator ad-tech investment opportunities are often inadequate. “It's been really hard to find anything of scale.” Additionally, tech startups are facing limitations because of their their dependence on the major social platforms such as Facebook to provide data. Creators as media buys? Companies such as influencer network Influential are offering extra incentives for marketers, such as helping them approach creator partnerships like media buys and providing all the services and tech to make that possible, said CEO Ryan Detert. “We’re driving [the same] sort of efficacy” as traditional media, Detert said, noting that creators are responsible for measurable outcomes like walking into a QSR restaurant or tuning into TV shows. But while the media buy narrative is compelling, like everything in the influencer marketing space, the hype must be measured with nuance, said McCormack. “We’re not just purchasing ad space in the creators' feed,” he said. “We’re buying into audience connection, the authenticity that they have … it’s not a traditional media buy, but media is very important.” From the Creator’s Perspective, Here’s What Makes a Good Influencer Marketing Agency