In 2021, Snapchat paid out more than $250 million in payments through its Spotlight short-form content funding program, which hasn't always been a perfect solution for attracting creators but has helped Snap generate more interest in its TikTok-like option as it battles rising competition in the space.
Snapchat first introduced Spotlight in November of last year, with the promise of a daily payout of $1 million to Spotlight producers, split among the top-performing video. Since then, the financing has been altered to more vague millions every month and more qualifiers have been added to the budget. Even still, $250 million over the course of 348 days in 2021 is a big investment, with the money going to over 12,000 short film artists. That means that the Spotlight creators who have been compensated through the program have made an average of more than $20k each.
The positivity of their community has astounded Snapchat. Every day on Spotlight, their abilities, passions, and unique perspectives are displayed, and it's been thrilling to see Snapchatters' imaginations run wild when utilizing Creative Tools. One of Snapchat's Creative Tools or an augmented reality Lens is used in almost 65 percent of Spotlight entries. In many ways, it's been a success for Snap, but as previously stated, it hasn't always been smooth sailing. In the middle of the year, Snapchat was forced to revise the program after creators complained that their payment amounts had significantly decreased over time, as well as delays in payments and other issues that had soured them on the experience.
This is the polar opposite of the program's intended impact, which was to strengthen ties with the creator community. Part of the issue is that once Snapchat implemented direct funding, creators quickly became reliant on it, and when the company attempted to reduce that funding, it had a direct impact on their income. As opposed to a self-sustaining advertising or other creator ecosystem, direct funding programs have a major flaw. However, the initial push may have given Spotlight enough of a boost to help Snap combat TikTok's surge and keep its users from switching to the current hot app. It's truly incredible to comprehend TikTok's impact on the social media environment.
TikTok's popularity has impacted the latest feature upgrades in practically every other social app, with the platform on course to achieve 1.5 billion users in its own right. While imitation has always played a role in product innovation and development, the continuous shift towards full-screen, short-form video is transforming the UI of numerous tools and may be the biggest overall shift in consumption patterns in the history of the medium.
Given how TikTok has dominated usage trends and become the platform of choice for many young users, Snapchat's Spotlight initiative is likely to be considered a success in this regard. Snap has certainly created the foundations for continuous usage and interest by adding its form of the same and compensating a popular artist, which has introduced another element to the app that will keep it evolving by these trends.
And it isn't finished yet. They'll continue to provide a variety of possibilities to satisfy the demands of creators as they entertain the audience while building their brand in the coming year. And, for their community, they'll keep making it easier to follow and consume content from their favorite creators, whether on Spotlight, Stories, or Discover. Over 25 Spotlight creators are syndicating their shows on Discover right now, with more to follow in the coming months.
A new source of creator content, new funding for creators, and new ways to identify talent are all on the horizon. Is that $250 million worth it? Yes, you'd probably think, and despite some teething issues, Snap appears to be on to something with its Spotlight strategy.