When determining what’s worth buying and what isn’t, who wields the greatest influence over these fashion decisions? It’s the consumer.
But the bridge between the consumer and the brand or retailer is, in fact, the influencer/creator.
As per insights from LTK (previously known as Like To Know It), Gen Z women primarily turn to TikTok, creators, and their friends for fashion inspiration. For beauty inspiration, creators hold the highest influence among Gen Z individuals.
While Gen Z and millennials exhibit greater trust in creators, as compared to advertisements and celebrities, all age groups are increasingly using creators’ affiliate links for online purchases. Among them, Gen Z leads with a rate of 75%, followed by millennials at 67%. Research from LTK reinforces the idea that consumers are highly influenced in their shopping choices by what they observe on social media platforms.
In light of this momentum, Shopify has introduced a feature designed to simplify the process of connecting creators with merchants and empower them to generate income more quickly and efficiently.
Dubbed “Collabs Network” and launched on Wednesday (June 28), the application is available for free installation to all Shopify merchants, allowing them to establish a roster of creators to collaborate with, driving customer acquisition and boosting sales. Simultaneously, this feature empowers creators to explore product options and establish connections with brands and retailers.
Through Collabs Network, creators navigate the network and explore specific categories, such as yoga and beauty, and gain insights into the brands that their followers are purchasing from. Meanwhile, brands can also identify the creators who are generating the highest sales.
Additionally, they can acquire affiliate links without having to individually engage in affiliate partnerships, which are typically mediated by intermediaries or agencies responsible for managing contractual arrangements.
Collabs Network is an expansion of the Shopify Collabs app, which made its debut in August.
In today’s landscape, relevance is important. To establish relevance with consumers, brands need to demonstrate authenticity and a distinct mission.
Both brands and creators are adopting a more deliberate approach to collaborations. In fact, numerous brands and retailers are now engaging with influencers who are experts in specific fields, such as doctors and specialized professionals, to foster relevancy and provide educational value to consumers.
Consider the collaboration between Sydney Adams, a fitness influencer on TikTok, and 1 UP Nutrition, to introduce a new protein powder. Rather than seeking out the most popular celebrity of the moment, they opted to stay within their specific niche and partnered with an influencer who operates within the fitness space.
“Creators are generally underserved today in their financial lives,” Marie-Elise Droga, head of FinTech at Visa, told PYMNTS CEO Karen Webster. “They can’t be looked at through the lens of an individual consumer — this is the fastest growing category of SMBs in the world.”
Content creators collaborating with Shopify merchants reportedly have higher average commissions from product sales compared to other networks because creators interact directly with merchants without any intermediaries. Commissions surpass the 10% threshold on average.
Furthermore, creators receive their commission payments faster through Collabs. These payments are timed to align with the return periods established by retailers, typically spanning around 30 days or sometimes longer.
In order to join the Collabs Network, creators must meet two requirements: They must have a minimum of 1,000 followers, and they need to be located in an area where a merchant is actively selling products.
For merchants, the tool can assist with creator management and selection. For instance, a merchant may have specific criteria, such as promoting beauty products or having a certain follower count, when choosing collaboration partners. This includes providing merchants with various settings and options to accept or reject individuals, or even place them on a waitlist.
However, Shopify does note that it applies a transaction processing fee of 2.9% on merchants to cover the costs associated with its automatic payments feature via Shopify Billing.
Since social creators heavily rely on clicks and views, it becomes crucial to have accessible working capital and financing readily available to seize the opportunity of a viral moment and leverage audience momentum. This support can transform creators from a one-hit wonder to the next Alix Earle.
“Creators need help in developing their business, developing the business plan, the business itself, how to grow their business, how to move it from being something that they dabble at and pursue to really being a small business,” said Droga, saying Visa has a dedicated team focused on understanding and developing solutions for creators and social platforms.
“It’s also global in nature, which syncs very nicely with our DNA, and unlike retail, the social opportunity already bleeds into so many segments — including gaming,” she added.