It's a Matter of...Earned: Unleashing the Power of Influence

Conor Begley: Hi, I'm Conor Begley, the co- founder of Tribe Dynamics and the Chief Strategy Officer of CreatorIQ. And to me it's a matter of earned.

Kelly Kovack: Influencer marketing is not a new idea. Far from it. I'm Kelly Kovack, founder of BeautyMatter. From a marketing perspective, the notion of leveraging an individual to influence potential consumer purchasing behavior can be tracked back over 100 years. However, the rise of social media democratized the concept of influence, giving birth to the creator economy and creating the equivalent of marketing rocket fuel in the right hands. Today, more than 50 million people globally consider themselves to be creators. At ground zero of the creation of the beauty influencer wave was a business called Tribe Dynamics and a charismatic founder named Conor Begley, who schooled an industry on how to quantify and leverage the power of this new influence. Conor, well thank you for making time to talk today.

Conor Begley: Yeah, thanks for having me. This is fun. I'm excited.

Kelly Kovack: It's hard to believe, but I think we've known each other almost a decade.

Conor Begley: That's just making me feel old now.

Kelly Kovack: Well, I'm older than you are. But we met when I was running a hair care brand and we were running influencer programs off a spreadsheet and a three ring binder, and you were in the early days of launching Tribe. And I remember we met at a bar and I was like," Am I doing this thing right?" And that was where it all started. And then we signed up for Tribe and got off the spreadsheets. But a lot has happened since. Can you share a little bit about your backstory and the impetus for founding Tribe Dynamics just to set the stage? I mean everyone knows you in beauty, but still.

Conor Begley: Well, not everybody yet. Not everybody. Yeah. Happy to share. And it's fun to reflect sometimes on a decade. People can get caught up in quarters or years and when you think in what can you build in 10 years, it's a perspective I really like. One I've latched onto. Because it's like, okay, I've got another three decades or four decades of work. Get a lot done in four decades. So Tribe. Yeah, so we co- founded Tribe a little over 10 years ago. And I think in terms of the story, in terms of how we got going, at the beginning, we were trying a bunch of different stuff. So we'd really latched onto this idea that everybody was becoming publishers, whether you were a bar or an individual or a retailer or a brand. Everybody was becoming publishers and we thought that people working together as publishers would be a good thing to do. And then as we started testing different categories, really latched onto the beauty category. And as we latched onto the beauty category, I talked to a good friend of mine who worked at Bare Essentials in their communications group and I asked her," Hey, how do you work with these different bloggers and YouTubers?" She's like," Well, I've got a list of 300 of them that I ship products out to each time we have a new product release." I was like," Oh, that's cool. What do you do after you ship the products out?" She's like," That's it." I was like," Well, that's silly. You're spending all this money and time and effort, you should know when you ship it out, who actually talks about you." And so then we built that software to help her do that. And then we started tracking thousands and thousands of these influencers and we said," Hey, it'd be really interesting to figure out which brands these people are talking about. So even when you don't ship them something, just what are they talking about? Which brands are they talking about the most?" And so we mapped that out and the brand that really stood out was NYX. N-Y-X. And at the time, this was pretty early and I was still new to beauty, so frankly I thought we were picking up some noise about some airport in New York that I had never inaudible. Because NYX was beating L'Oreal, CoverGirl, Maybelline, these billion dollar competitors or multibillion dollar competitors, in terms of how many influencers were talking about them. Fast forward, NYX gets acquired for$ 500 million, so half a billion dollars by L'Oreal at a record setting revenue multiple at the time. And we got a lot of attention. The investment banker that was working on that deal, guy named Sean Westfall, reached out and was like," Hey, we need to chat. Your data was the only data that showed this happening, and I think you got us a full extra revenue multiple in the deal." So an extra$ 100 million because they were doing about 100 million in revenue, of which we got zero, but whatever. And then we saw the same patterns over and over again. So you saw Too Faced really pop in our data. They got acquired for a billion and a half by Este. And then Anastasia Beverly Hills got valued at two to three billion when they last fundraised, then Huda Beauty, then you saw it in skincare initially with Drunk Elephant, Tasha. Later with brands like Tula, Glow Recipe, et cetera. And then saw it in hair care with Olaplex. Then you started seeing it in fashion with Allo Yoga, Jim Shark, Fashion Nova, Boohoo, Gucci on the high end. Where they would pop in our data and really kind of blow up in terms of top line revenue. And so I think that was really the founding story. And then what we tried to do was talk to those people and figure out what they were doing and then try to build our software around their processes. Because whatever they're doing, inevitably other people will want to do. That's the origin story of Tribe and then we just joined forces with a company called CreatorIQ about eight, nine months ago. They do really well in the entertainment sector, so they work with Netflix, Hulu, all the big talent agencies. So UTA, CAA, as well as a bunch of other retailers and other big companies. So now I think we're probably the biggest in the space.

Kelly Kovack: Well, I want to go back a little bit because we at BeautyMatter, a lot of our partners, we have this sweet spot with ad tech and marketing tech companies, and I think that's because John and I have owned and run businesses, so we really understand the power of these platforms. But a lot of the platforms don't understand the nuances of beauty. And you guys put your stake in the ground early on to focus on beauty and build from there, and you successfully embedded yourself in the industry as the go- to platform. And I think there's so many learnings for other platforms or people who want to tap into the power of the beauty industry. You have to understand the industry. We're not just widgets, right? But you guys did that really well and you effectively built a brand and you didn't just show up with a technology solution.

Conor Begley: Yeah. That was really intentional. So when we first started, we were super young, so I was trying to learn as much as I could just about running businesses, running software companies, et cetera. And so read a series of books that had a consistent theme. So one's the Peter Thiel book Zero to One. Regardless of his politics, he's very good at technology. There's another one called Crossing the Chasm and a couple others where the gist of it was that most of the really successful technology companies started out, particularly in white spaces, new areas where it's a totally new thing, which it was for us, focused on a very particular niche where that technology was the most important at that time. So the best example of this is PayPal. PayPal, when it first started in the late'90s... Believe it was late'90s, early 2000s. Exchanging money online was not a normal thing. That was very risky. And so it was a really high threshold for anybody willing to do it. And so what they found was on eBay you had all these power sellers. So I'm selling 150 Mickey Mouse figurines a month for$ 11. And at the time, in order to get paid, you had to actually write a check and mail it to the person. So you had to mail your$ 11 check. And as the seller you're like," Oh my God, this is a huge pain in the ass." So what they did was they really focused on eBay initially. They're like," All we're going to do is focus on eBay." And so it was like 95% of their revenue at the time of their acquisition by eBay for whatever amount of money it was, a billion dollars or whatever enormous amount of money it was. And you see those patterns over and over again. So for us, beauty was similar where we said," Okay, right now at the beginning of the influencer phase, beauty was probably the category where influencers were having the biggest impact. And so let's really focus on that category and just build technology that fits them a little bit better than everybody else. And then over time we can go vertical by vertical, so go into fashion, go into fitness, going to food, as we get that initial foothold." And so I think in the meantime, we ended up building a very big brand in the beauty industry, which was intentional. But I remember I got told at one point," Conor, I think you're the most loved and hated man in the beauty industry."

Kelly Kovack: Well, didn't you also... Maybe I'm making this up. Your quarterly reports became a thing. Didn't you print them and deliver them by hand to all the big beauty brands? Am I making that up?

Conor Begley: No. There's a couple things. So definitely printed and sent them to somebody, but it wasn't the brands. I tried to do that, but that was a failed project. So what we did early on was we're like," Okay, everybody's becoming a publisher. Well that doesn't just affect brands, that also affects us." So you had organizations like the CEW who historically hadn't really been a publisher but had 50,000 members on their mailing list that were all executives in the beauty industry. And so what we realized was that in the same way that you could support a creator by providing them with product or helping them with cool stuff, helping them to be a better creator, we could really help these new publishers to be better. And so we really invested in creating a lot of custom content specifically for CEW as a starting point. And then as we tried to expand, we would bundle our reports and we sent them to WWD and Business of Fashion and some of the others where we eventually built relationships over time. And so that was where we did it. I created an actual book that had our first however many reports in it and was going to send it to everybody. And we had it professionally designed. I thought it looked really good. My co- founder thought it looked like a yearbook and so we didn't send it out. But I think the CEW publishing our reports, WWD publishing our reports, Business of Fashion working with us really consistently on the data side helped us to really create a brand, a narrative, and to help validate the metrics.

Kelly Kovack: No, you guys have been... Since this went from a side hustle to a real business, have been great partners helping us substantiate some of the trends for our M& A report. You have access to data that publishers just don't have and you make it really easy. So there's that too. Let's get back to influencer marketing. The idea of using influencers, it's not new. I mean we used influencers in 1996 at Bliss, but social media really was a game changer. And influencer marketing has evolved to a creator economy worth, I think I read$ 104 billion and I think something like 50 million creators. Which is just mind boggling because there's this career that didn't exist a decade ago, but you were one of the pioneers. Can you share some of the new rules that have emerged governing the relationship between creators and brands and the social media platforms that fuel the entire economy?

Conor Begley: Yeah. There's a lot that's changed over time. I think that one of the bigger shifts over the last couple of years... Historically we always talked about earned media, organic content being king, and it still is. But I think the blending of paid relationships in organic content has accelerated over the last couple of years as people have really become businesses and as more brands have come to the table and competition has increased. Other trends, obviously TikTok is really on the rise dramatically. So if you look at the data, I think they're going to surpass YouTube in terms of influencer spend by the end of this year, I believe. This year, next year. And then be on their way. Instagram still will be number one, but will be on their way towards being number one in that direction. That's obviously a big thing that's risen and it's a bigger deal than people realize. Since we've started, people always talk about," What's the new network? What's the new network?" And it's like, well, it's only been one, it's TikTok, in the last 10 years. These things don't pop up every year. They pop up for six months, like Triller and then Clubhouse and then they die. So I think that's another thing that we see changing. I'm trying to think of what other broad trends. But I think the same basic principles have held true the entire time. One of the best responses I've heard to a question about the future was Jeff Bezos. So they asked him like," Hey, what's the future? What's going to change?" And he's like," Actually, I think that it's much easier to predict what won't change than what will change." And it's much easier to build on that because you know it's not going to change. He's like," For Amazon, we know people are always going to want it faster, they're always going to want it cheaper, and they're always going to want more selection. And so for us, those are the pillars we build on. So the reason we do drone technology is not because we want to do drones, it's because if we get drones right it can get stuff to people cheaper and faster, more than likely." And influencers, the core principles are one, the scale is massive. So this is very different than it was 10 years ago. So most brands are working with thousands or tens of thousands of creators, not dozens. It is more organic. So it is 90 to 95% organic content and that will continue to be the case. So that's really where you should place your time and effort. Being an in- house process is a much better way to do it. So it's much better to have the relationship direct between the brand and the creator. And if you do start working with them, you want to work with them really early, not late. So you want to start working with them when they're small and ideally you can actually use your own brand platform to help them get big. So that's the thing I think about when it comes to... I really try to focus on the things that won't change rather than what is going to be new.

Kelly Kovack: Well, I think one of the things that has changed, but I think it's more of an evolution that it was only a matter of time, but influencer marketing is now a significant budget line item for most beauty brands. As what's called the creator economy has emerged, what has also evolved is the expectation around compensation. And rightfully so. I mean, given the shift, how do you advise startups to approach building influencer strategies? Because the free product strategy really only gets you so far.

Conor Begley: For sure. I will say that I still think the basic tenant... Well let's take a step back. So why did NYX start doing this in the beginning? It's because they didn't have money to run TV ads and print ads and other big media buys and they couldn't compete there. And so they competed in this arena where they could. Where you can win small battles and grow over time. When I'm advising a brand, a new brand, on how to approach this space, I still think free product is the starting point. So it's like, hey, let's go out and what you want to do is identify people that have a high propensity to talk about you. So what you want to do is say like," Okay, I am a clean makeup brand." Well, who is it that's talking about Ilia? Who is it that's talking about Kosas? Who is it that's talking about these clean makeup brands? Okay. First let's identify those people, then let's reach out to them. Glow Recipe did a really good job of this. They identified their first 300 people and then looked at all of their content and sent them a customized regiment that they recommended and then said," Hey, this is the one we recommend based on your content. We love what you're doing. If you're interested in it, we'll send it to you." And they said that those 300 people are still the core of where they are. And Glow Recipe is over 100 million in revenue. They're like a top three to five brand we track. Number one some months. And so I think still the core strategy is find people that are likely to like your brand, reach out, build a relationship with them and get your product into their hands. The second stage is, okay, now that you've done that, now what do you do? And I think the way that you amplify this is you reward the behavior that you want to see repeated. So if you find somebody, you reach out, you send them product, they create really great content, well you want to reward that. So you say," Hey, thanks so much for creating really great content about us. We love what you're doing. We'd love to make you an ambassador to the brand. We'd love to put you on an annual contract where you'll review our products or get early access to our products. We'll use you as a model for upcoming collections. We'll highlight you in our gondolas in store. We'll do these things." So that person goes," Oh my god, when I talked about this brand, look what happened to me." And everybody else does the same thing. And," Oh my god, if you talk about Glow Recipe, look what can happen for you." And then you just build on that naturally. You just keep that motion going of finding people, reaching out, building a relationship, and then ultimately retaining them, making sure that they stick with you over time. So that's the motion that I've seen work repeatedly. You do that, you won't fail.

Kelly Kovack: Yeah, I agree. I mean I think with all things, people are always looking for a shortcut. And so there was this period of time I feel like everyone was hiring agencies to outsource this function. Which if you are really building an influencer marketing strategy, is time consuming. They are one to one conversations. There's no way around it even when you are using technology. But outsourcing it doesn't get you the relationship and it also has this very transactional churn and burn mentality to it. Are you seeing more and more brands actually making the investment to bring it in house? Because also, to do it well requires technology. It requires a commitment to sending the product out, which just the product and the shipping is not inconsequential. And then you need the human beings to interact with all of these people. So gone are the days of an intern running your social media strategy.

Conor Begley: Yeah. Certainly not the case. I think if you were to look at the brands that have really won, they tend to have fairly large internal teams. So I think Color Pops team at its peak, I think was close to 35, 40 people across all social influencers, et cetera. NYX, which was in the early days, had a team like eight to 10 people. If you ask Glow Recipe who their team is that focuses on influencers, they say the whole company. So I think that that's definitely changed. Now obviously technology helps. So if you look at the companies that we work with, I would say about half the time they're using some other kind of platform as well. So Dash Hudson is really commonly used on the owned media side. Brand is really commonly used for gifting and for large scale messaging for micro influencers. You'll see the company we partnered with like CreatorIQ or Tracker used more at the corporate level for the larger organizations. So definitely it requires scale, commitment, effort, et cetera. Trying to remember, what was the original question? I-

Kelly Kovack: I don't even know. I've lost track of it as well. No, it was really the requirements from a business focus and I think just a budgeting perspective and a human resource perspective. So I think sometimes at least young brands don't realize how sophisticated this whole concept of influencer marketing has gotten. And it has. It has to be fully ingrained in the marketing strategy as well. Because for a long time it lived off to the side with no real ownership. Was it communications? Was it marketing? Who owned these influencers?

Conor Begley: Yeah, for sure. It's definitely taken center stage I think as you've seen brands have these really big outcomes. If you look at our top 10 independent skincare brands by EMV, so by influencer coverage, eight out of the 10 have been acquired. So that's like Tula, Youth To The People, Farmacy. For very large sums of money. As well as the Tasha's, Drunk Elephants of the world historically. And the only two that haven't been acquired are Glow Recipe and Summer Fridays who are both supposedly just killing it. And so you can only sit there as a skincare brand or as a makeup brand or a haircare brand for so long and go," Wow, these people are kicking my ass." Pardon my language. And this is one of the ways they're doing it and so I've got to figure it out and it can't just be on the sidelines. Now, one area I think is important where we've seen it... Not everything was made for influencers. If your Brinks Trucks or Armand Hammer deodorant, people just don't talk about you. It doesn't happen that often. And so you want to have your investment as a brand be relative to the impact that it can have for you, like any other channel. So in beauty, there's a hierarchy. Makeup, highly visual, easy to talk about. By far the highest volume of content of any of the categories. And so for a lot of makeup brands, digital is essentially 100% of their budget and influencers are like 50% of that. Of the entire marketing, offline, online budget. Then you have skincare and hair care, which not quite as visual, still a lot of content, but call it 70% less than makeup. And for them, super critical. But there are other channels that matter too. And then you've got fragrance at the bottom where it's very hard to communicate fragrance visually. And it's very hard to talk about a scent online. And so in those categories, it's not that you shouldn't do influencers, but it should be a much smaller percentage of your budget overall. And so there is definite differences. So not everybody should do this.

Kelly Kovack: I think as the budgets get bigger and it becomes more important, the KPIs have gotten much more sophisticated. Early on it was really vanity metrics that drove reporting. But can you share a little bit about how influencer content has become core to brand KPIs such as awareness, desirability, conversion, community? As the importance of influencers has increased, the impact brands are actually looking at almost the core DNA KPIs that they measure.

Conor Begley: For sure. So there's two things. There's the KPIs that lead to influencer success, and then there's the KPIs coming out of that. And the KPIs coming out of that are the thing that I'm super excited about. So this is something that I've been thinking about for the last few months. It's going to be all we focus on from a research perspective over the next year. But let's talk about the inputs first. So there's two core inputs to being successful with influencers in terms of measurement. First one is retention. Just like you measure retention for your customer base. It is the most predictive variable we have for growth. If you get an influencer in and they talk about you one time and they never talk about you again, it is very, very difficult to become Olaplex. It is impossible. And so being able to recruit and retain your influencers is the most important metric. And then second one is on the new influencer acquisition side. So am I acquiring new people? Okay, I'm keeping everybody around, but if I'm not acquiring any new customers, it's very hard to grow as a company. And so those are the two core levers to growth. Retention and new acquisition. Then you can measure those independently. On the outcome basis, this is where I'm really excited. When we first started we're like," Holy shit, if you get a lot of EMV, you're going to blow up. We don't know why, but we know that happens."

Kelly Kovack: And here's the list of people to watch.

Conor Begley: Yeah. And so then we're like, okay. So then people were like," Oh, I got to get EMV." And then they did it all the wrong ways and we're like," Oh shit. No, no, no, no. Don't do that." So first we had to figure out how you get there. And that's retention, new acquisition. You can measure those very specifically and on a person by person basis. But then it becomes, okay, how do I know what this is getting me? I know high level it's better to be Glow Recipe than not be Glow Recipe, but what is it getting me? And it really came to me. So most people tend to focus on, it builds awareness or it builds sales. It's either brand marketing or it's end consumer, direct consumer pay to play. And actually that's just a really bad way of thinking about it because there's so much in between. So the high level, first one is awareness. Video gets created about my brand. I am Glow Recipe. Somebody hears about me for the first time, they now have awareness of my brand. So that's the first thing. And there's stuff you can do there. The second thing is, okay, now that I have awareness, a certain percentage of those people will proactively search for that brand. And Doug Jensen just talked about it in our podcast. They measure it as desirability, which is when somebody searches for you, they desire to learn more. So the first one is awareness. The second one is desirability, which you can do by Google search, people searching for you. The third one is, okay, now that I've searched for you, so I'm searching for this new product, it's some new Glow Recipe, watermelon, whatever, and I search for it. Well, I go to my Google search and there's nothing there. There's no YouTube videos, there's no articles, there's no reviews, there's none of that stuff. It's probably going to decrease the likelihood that I'm going to buy that product. So the conversion rates on that will go down. Alternatively, we know that if you get a bunch of influencer content, you tend to see more reviews on Sephora. Obviously YouTube videos show up in Google search, blog articles do as well, whatever. And so the third one is conversion rates should go up. So conversion rates when people actually search for you. And then the fourth one that I think is really critical, Doug has also talked about in the past is, okay, now Instagram post happens about you and it says @ GlowRecipe. Well, a certain number of those people will go to Glow Recipe's Instagram account and follow that account. So it grows their fan count, it grows their community. And then the fifth one, which I'm not even talking about is sales. It should theoretically generate sales through affiliate links and whatever. So anyways, so those are the KPIs you should really be thinking about is what is the effect that it has on awareness? What is the effect it has on people searching for me? What is the effect it has on conversion rates once somebody searches for me? How does it affect the size of my community that can communicate with on an ongoing basis? And then ultimately, how does it direct sales? Which kind of flows down from all those things. And so if you're just measuring awareness in sales, you're missing everything in between that I think is arguably more important than just the beginning and the end. So that's the thing that we're diving in on. We have all the Google search data from Spate, we've got some awareness data from a partner we're working with, we're getting conversion rate data. And I've run this by brands like," Oh yeah, when we see EMV spike, conversion rates go up, brand search goes up, traffic goes up, obviously Instagram fan count grows up." Those are the things should be thinking about. We're working on that right now. By the end, my goal is to say an EMV dollar equals six fans or whatever it happens to be, but still in progress.

Kelly Kovack: The consumer path to purchase or how they engage on social or with brands, it's a whole ecosystem. It's like a spider web. So there's nothing linear about it. It's fascinating because on some level, if you just think the impact one person can have, and you take it back to old school marketing or customer service, it's that one on one relationship that then has that amplification of that person tells one person tells one person, but on social it's massive.

Conor Begley: Well, I mean you think about who's following a professional hair stylist on Instagram? It's not your average consumer. It's somebody that's really into hair or somebody following a professional makeup artist or whatever. And so in the same way that my wife isn't that into makeup, but she follows running bloggers. And so when her friends need advice on what the best running shoe is or where to go hiking or whatever, they ask my wife because they know that she follows all the running bloggers. And so same thing happens here where the people that you are affecting, that community that's listening to that is more than likely a disproportionate referrer offline as well in terms of just the end consumer that's watching that video. And so that's why it's very difficult to measure and I think people really get caught in this trap of how much revenue did this one post drive this day that I paid for? And it just misses so much of the impact.

Kelly Kovack: I want to dive into TikTok a little bit because really Instagram and YouTube have been primarily the two platforms that really fueled this whole rise of influencer marketing and I think also were the fuel for direct consumer brands. And a lot of brands put all their eggs in that Instagram basket. And when things changed and everyone caught onto the game and cost of acquisition, it is no longer a profitable way to solely build a community. TikTok comes along. And so the impact of TikTok I think is profound in a lot of ways. One is you had a new social platform, which to your point earlier, doesn't happen very often, that had traction. So you had an alternative to Instagram and people all of a sudden shifted to TikTok. Some of them are repeating the mistake of Instagram, but whatever. For another day. That old adage, don't put all your eggs in one basket. But the second thing is also how content is served up and also the aesthetic change in the content being created. And I think the pandemic clearly for me, put this line in the sand, pre covid and post covid. Pre covid, you had all of this picture perfect Instagram feeds and then overnight it looked like all of those influencers felt out of step with the rest of the world. And you had these people on TikTok just showing up as they were having fun instead of this very contrived, planned content. So the impact I think is so profound.

Conor Begley: Yeah. My favorite TikTok comment that you'll see... I get served up these videos. Is people are way too comfortable on this app. They're doing stuff. There's a series of videos where people do stuff and you're like," Did she just fart on camera and just kept going? Is that happening?" So as the world went to shit, so did the content. In a good way. In a relatable way. Everybody was stuck in their house. But yeah, TikTok's a fascinating subject. I think just today there was an article or there was a post from someone, I can't remember who it was, some creator, that was like," Instagram, what happened? I just want to see photos from my friends again." And it actually got shared by Kylie Jenner as well, who's like, this is as big as it gets in terms of Instagram. Because they've really decided to be a video company and they've shifted their whole strategy because of TikTok's success. YouTube's implemented YouTube Shorts primarily in response to the success that TikTok has had. As well as changed some of the way that they serve up content. And so yeah, it's a big momentum shift. And then underlying all of that is theoretical security risks to having most of the US population on a platform that's owned by China. So it's a super complex topic. I think from a brand perspective, I think there's a few things we're thinking about. It's on the rise. And when things are on the rise, it attracts creators. Because as a creator, if you go on Instagram, it's a shrinking audience. And so it's much harder to build an audience yourself because you have to take it from somebody else. Versus on TikTok, it's a growing audience so it's easier to grow. You can grow much more quickly if you get good. Now there are some negatives. So as a creator, you don't have a built in audience. They just show the best content. So it raises the bar on the level of content you have to create that makes it much more difficult to invest in as a brand because it's so unpredictable. You have no idea whether it's going to work or not work. And I think if you were to look at branded content, because TikTok favors the best content, not just content from the people that you follow, the hashtag ad content nobody likes so it never shows up. So the predictability and the value of sponsored content on that channel is just not as great unless you create something that's super interesting and also happens to be branded, which is a tough crossroads to get at. And so you just find that there is a lot less branded content on TikTok than there is on Instagram, as an example.

Kelly Kovack: Well, I mean Meta is definitely not sitting on their hands just letting TikTok eat their lunch. I think it was just this week they announced that they're going to change the way user posts and videos show up on Facebook. So I don't know. I think maybe we'll be seeing a next evolution of influencer marketing and how these other platforms are going to evolve. But looking forward, what are some of the trends on your radar in respect to this next evolution of the creator economy or influencer marketing that you're paying attention to?

Conor Begley: Yeah. I think a lot of it is the shift to payments for creators. I think a lot of the creators are now realizing that they're fairly large businesses. So I think if you were to look at... I can't remember who it was. I heard the average number of viewers on QVC. And QVC does an absolute enormous amount of money. So they do much more than people realize. It's billions of dollars in net revenue to them. And it's like four to six billion or something like that. And at any one time on QVC, it's somewhere around 100,000 people watching the show. It's in that range. In a one hour segment. 100, 000 to 150,000. So I was having this conversation with QVC and then I'm following a YouTuber that talks about sports that I follow online. And his typical show is around 40,000 or 50,000 concurrent viewers. Concurrent like at that moment, 50, 000. So probably on an hourly basis it's probably like 100,000. So his audience is probably about the same size as QVC's. And he just signed what feels like a massive contract. It's like a$ 40 million annual contract with Fanduel sports. But if I look at the monetization gap between him and QVC, which are notably very different platforms, it's enormous. So the amount of money that they're getting on a per user basis is just so wide. And that gap will continue to close over time because time spent and advertising dollars tend to be very aligned. So I think this theme of influencer monetization will only continue. I think even today they're very under monetized. So I think as that happens, it will be interesting to watch all of these people emerge and the tools and infrastructure that they need to solve their problems. Okay, I'm now functionally a publisher like QVC or Netflix or Hulu or Fox. How do I build the infrastructure to monetize it in the same way that they do? If you look at LIV golf tournament, it's all live on YouTube. It's not doing even linear television at all. So long story short, I think that's one of the trends that I'm paying attention to. The platforms will continue to change. I like the competition that TikTok has introduced, but that's a big thing I'm looking at.

Kelly Kovack: And what about, do you think the metaverse is going to impact this whole creator economy? I mean, I don't know. I'm still trying to figure out where I live on the metaverse conversation. I have very different, conflicting feelings about it.

Conor Begley: Yeah, I do as well in terms of conflicting feelings in multiple ways. So I think there's two metaverses. There's the metaverse that you throw on a VR headset and you're in a whole new world. And I bought an Oculus Rift and I guess it's called a Meta whatever. Bought one used it. It was awesome. I was like, this is going to change my world. And then realized that I can't play it for more than 30 minutes because it burns holes in my eyes because it's so close to my face and you just can't play it for very long. And it's like, nah. There's some really cool stuff it does, but it's just whatever. And so I think there's that. I think that will continue to get better over time and that's the full immersive experience. But I think the more tangible expression of the metaverse is just purely measured in how much time we spend online each day versus offline. And I think that's actually what they mean by the metaverse is just how much of your day is spent in some kind of digital world versus some non- digital world. And by digital world, I mean like text messages, Instagram, LinkedIn, tuned into YouTube video, whatever that is. That percentage will continue to increase where more and more of our world lives online rather than offline. And what I mean by I don't stand on that, I know that's going to continue to happen. I don't know how good I feel about it, right? I don't know if that's something like happy about, right? But yeah, that's the way I think about the metaverse. I think VR headset part is what gets all of the attention when it's really just more about what percent of your life do you spend in some kind of digital environment versus a physical one.

Kelly Kovack: Well, we'll have to come back 10 years from now and see whether we're right on the metaverse conversation.

Conor Begley: For sure.

Kelly Kovack: Well, Conor, thanks for taking the time and it's always fun to catch up with you.

Conor Begley: Yeah, it was great. I'm glad you had me on and it's really awesome to see how BeautyMatter has grown and expanded across channels. And I remember when you first started it and so glad that we've gotten to work together as you guys rose up and... Yeah.

Kelly Kovack: We're just getting started.

Conor Begley: I know. It's going to be great. BeautyMatter can exist for the same reason these new creators can. You can build up a large audience a lot easier than you used to be able to. And so congrats.

Kelly Kovack: Thank you.

Conor Begley: Hi, I'm Conor. And for me, it's a matter of earned. Because I think earned media has become the dominant form of media and will continue to be the most important media for brands and I think earning things is fun.

Kelly Kovack: For Conor, it's a matter of earned. Over the course of the past decade, Tribe Dynamics has been at the nexus of the emergence of the creator economy, building technology and providing intelligence to marketers, investors, and retailers on where to place their bets. Conor and his team at Tribe Dynamics educated and provided a platform to wrangle the power of social influence and evolve a marketing function once supported by interns into one of the most crucial marketing levers in any brand strategy. Consider this. In one decade, a totally new industry has emerged, estimated to be worth$ 105 billion. So in the end, it's a matter of earned. I'm Kelly Kovack. See you next time. If you like what you heard, don't forget, rate, review, and subscribe to our podcast. It's A Matter Of as a production of BeautyMatter. You can find more content and insights on beautymatter. com and follow us on social media.