How Instagram subscription model will impact Indian creator economy

Instagram has recently introduced a subscription model to some of the top creators in the US as they are testing the SVOD model to boost the creator economy.

A few days ago, Salman Memon, a Twitter user from India, in a tweet shared screengrabs of the subscription prices for premium content from some of the top content creators from the US. The prices mentioned in the shared photos ranged from - Rs 85 to Rs 890.

While prima facie it might sound like a wonderful thing for the creators, this is apparently not the case, as became evident during conversations BestMediaInfo.com held with agencies and content creators. However, many have come out in support of the model too and said that it would assure a fixed, steady income for the deserving creators and will also help brands in choosing which influencers they want to go ahead with for collaborations.

The reasons why India may be hesitant in accepting the subscription-based model range from the low purchasing power of the average person to the resultant decrease in engagement rates to the pressure it will put on content creators to come up with fresh and top-notch content which justifies the subscription fees paid by the viewers.

India is still a money-sensitive country where people prefer free content over a paid subscription, the majority of Indians are still adapting to the digital shift and with Covid resulting in a loss of income to the majority of people, it remains to be seen whether people will be ready to pay for multiple creators.

Aayush Bansal

Aayush Bansal, Co-founder and Director, BlackCab, said, “This is yet to be seen but India is surely ready for subscription-based entertainment as proven by several successful OTT platforms. SVOD is sure to create a new entertainment and content consumption wave in the near future.” 

On the other hand, Manesh Swamy, Sr. VP - Creative, Social, PR and Marcom, Logicserve Digital, said, “I feel we will have to wait and watch. With OTT players like Netflix struggling with Indian audiences, where one account is being shared with 15 people in their network, the challenge looks a bit steep. But you never know content creators have created their own niche and I’m sure for exclusive content from the favourite influencers, fans might loosen up their pockets. There are around 200 million short-video users in India. This is approximately 35-40% of smartphone owners and it is predicted to grow even further to at least 575 million by 2025. I can roughly put it that short videos equal longer reach.”

Shradha Agarwal, COO and Head of Strategy at Grapes Digital, agreed with the fact that the model will take time to be accepted in India.

It should be noted that the feature is yet to be introduced for Indian creators, however, Indian users can subscribe to the US creators and pay the fee to see their premium content. It is noteworthy that while a lot of creators rely on brand collaboration and partnership for a living, subscriptions might play a very important role in the coming future.

Ishan Jindal

Ishan Jindal, Founder and CEO, Wobb.ai, said, “Creators have limited and uncertain sources of income today, making it challenging for them to become full-time creators. Subscriptions bring visibility in income and this will give rise to more creators in the coming years.”

This might create pressure on the influencers to churn out quality content for the subscribers, as was revealed in a study conducted by Wobb on influencers on subscription-based model. 42% of the respondents were concerned about not being able to differentiate consistently enough to charge for a premium on their content. 

Brand partnership and collaborations being the main source of income for content creators will also get affected if a subscription model is introduced, brands will target more loyal customers who pay the subscription fees for their favourite creators.

Ritesh Ujjwal

Ritesh Ujjwal, CEO and Co-founder, Kofluence, said, “When it comes to brand collaborations, a paid subscriber base could turn out to be a valuable and loyal customer segment for brands to target when formulating their influencer marketing campaign messaging. So essentially, there would be a higher level of influence that the creators would be able to yield on their subscribers through features such as subscriber stories, special lives, interaction opportunities and more, thereby generating improved ROI from influencer collaborations.”

Shuchi Sethi

Shuchi Sethi, Business Head - AnyTag, said, “With the rising social media consumption and engagement, B2C and D2C brands across segments have moved towards influencer marketing. The move will enable them to identify the right influencer for their brand, having a loyal and active audience and drive more specific content for their products.”

Sarvesh Blanc, Partner and Creative Director, DigiChefs, said, “Brands would move away from their generic approach to a much more targeted one. The choice of influencers would move from 'who has more number of followers' to 'who has more number of subscribers', which indirectly will point to 'who has the most engaging quality of content that people are willing to pay for.' This shift will renew the audience's interest in the influencer-brand collaboration.”

BestMediaInfo.com also spoke to a few influencers on this topic, Naina Singh, a fashion and lifestyle influencer, said, “With subscriptions open, creators could potentially see a huge loss in their engagement because, in India, not all followers will be open to paying for content. This model could pave the way for how the creator economy grows and functions in the future, however, the only way to be certain about it is to see how it is embraced’.

Nibeditaa Paal, Fashion and Lifestyle Influencer, said, “Instagram’s subscription-based model has the potential for creators to form even deeper relationships with their followers. This subscription-based model will enable us to create exclusive content for a set of followers who are most loyal to us. While a huge disadvantage of this model will be a loss in engagement, it will also help in narrowing down a set of followers who are not just loyal but also supremely interested in a creator's content, thereby giving a hyper-targeted audience to a brand. This move will actually enable a brand to rethink its influencer marketing strategy by evaluating whether they want to spend on a certain number of followers or a small but dedicated number of subscribers.”

Last year in the month of February, Twitter had also introduced Super Follow for their creators, wherein followers can support or subscribe to them for bonus content. Thinkly.me, an Indian social network site also has a similar offering for the ‘Thinklers’ on the platform to earn through subscription. In 2013, Patreon a US-based social network, came up with the idea of subscription with to ensure a sustainable income for creators.