Creator-founded products are significantly reshaping consumer shopping habits, according to new data from global creator agency Billion Dollar Boy.
The research — which surveyed more than 4,000 consumers, 500 marketers and 500 content creators in the U.S. and U.K. — reveals that 65 percent of consumers have purchased a creator-founded product or service. This trend is particularly strong among younger age groups, with 91 percent of 16- to 24-year-olds, 84 percent of 25- to 34-year-olds and 74 percent of 35- to 44-year-olds making similar purchases.
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The study also indicates that the appeal of creator-founded products is reshaping the market, with 27 percent of consumers more likely to buy from creators than traditional brands (24 percent).
“Brands simply cannot capture what creators have: The ability to build trust and connect with communities on a human level. That’s a compelling prospect for many consumers who, at the same time, have become increasingly accustomed to online shopping and social commerce,” said Becky Owen, global chief marketing officer at Billion Dollar Boy. “It’s empowering creators to launch their own products and services, transforming the creator economy into a breeding ground for the next generation of small and medium-sized businesses.”
The surge in consumer demand for creator-founded products and services is driven by a desire to support small and emerging businesses (35 percent), followed by a preference for trusting influencers over traditional brands (30 percent) and loyalty to the creators themselves (26 percent).
The findings also show that U.S. consumers are more likely (71 percent) to have purchased a creator-founded product or service, compared to U.K. consumers (58 percent).
Despite the popularity of creator entrepreneurs, the research reveals several obstacles they face when launching their own products or services, including a lack of budget (38 percent), lack of experience (31 percent), lack of a support network (27 percent) and limited access to a reliable supply chain (15 percent).
“Despite the strong consumer demand, becoming a creator entrepreneur isn’t straightforward,” Owen noted. “Creators already juggle multiple roles as business owners and content producers. Adding product or service launches to that mix can be daunting.”
Although the report highlights some challenges, many influencer-led brands do succeed. Kylie Jenner is a prime example of this, having leveraged her status and influence to become a billionaire beauty mogul.
At 18 years old, Jenner embarked on her beauty business with the launch of Kylie Lip Kits on Nov. 30, 2015 — a collection of three lip liquid lipsticks with corresponding lip liners. Jenner launched the trio of products as a test run, producing just 5,000 units of each shade priced at $29. The products sold out immediately and it took roughly six months to produce the next batch of products.
Nearly two years after starting the business, Jenner and her mom, Kris, sat down for their first in-depth interview about Kylie Cosmetics with WWD, revealing that the brand had earned $420 million in its first 18 months in business and was on track to hit a $1 billion valuation by 2022.
On a smaller — but still impressive — scale, New York-based brand Parke is also reaping the benefits of being an influencer-led business. Earlier this year, the brand, owned by Chelsea Parke who has more than 47,000 followers on Instagram, hosted its first pop-up shop, generating more than $300,000 in sales. While that was already impressive for a debut event, Parke exceeded expectations by doubling those sales at last month’s pop-up.
“Last year, if someone had asked me where Parke would be right now, I could never have imagined saying that thousands of people would come to our pop-up. I really am so incredibly grateful to everyone who supports,” Parke said. “It’s been amazing to build a brand that incorporates denim, sweats and everything in between. I’m honestly very excited about where we’re headed for the rest of the year, and I can’t wait for everyone to see it.”
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