In the US, a test of paid subscriptions has been running since January 20, 2022 with 10 Creators. According to Instagram, the creators are to be supported financially in this way, and the followers will receive access to exclusive content in return. Instagram launched in 2010 with the vision of allowing people to share their experiences with the world. This future adaptation for creators shows that the platform has long been a business for many people – and Instagram no longer just wants to earn money by advertisers placing ads, but also to have a piece of the creators’ pie. So the fact that the creators are to be supported is not entirely altruistic. After all, Instagram earns a share of every euro earned through a subscription.
But which creators will use this feature, what does it mean for advertisers, and which followers want to get involved in the game? Alexandra Friebe, Teamlead Digital Media Consulting at JOM Group, asked herself these questions and conducted a thought experiment.
A thought experiment: Creator’s perspective
From the creator’s perspective, what exclusive content is suitable to take place behind the Instagram paywall, for which the followers pay? In the case of daily newspapers or magazines, for example, in many cases it is either particularly hot news or, according to their own statements, well-researched and elaborately prepared articles. To transfer these parameters to the world of influencers, who in many cases offer their own lives as content, it could be deeper insights into private life. In this way, creators can offer their followers exclusivity, because not everyone immediately receives any information, but only the select group that pays for it.
Basically, the model is similar to that of Onlyfans: The creator offers content that the followers can consume if they pay for it. With Instagram, however, the creators must manage the balancing act between free and paid content with the planned model. They have to question to what extent the paywall fits them and their content and what content takes place where. At times, followers are used to any Instagram content being free. If that changes, creators have to deal with the expectations of the audience. If they don’t satisfy them, it can quickly become like any brand: the “customer” turns his back on the brand and turns away from it.
A thought experiment: “Advertisers” perspective
Can advertisers also find potential here? At the present time, probably not: To date, in many cases, the creators have relied on their large reach. It is often said that up to 1 million people can be reached with one story. This argument would be nullified with the use of the payment model – influencers would first have to build up their reach again.
Conversely, does this mean that the content in the freely accessible stories and livestreams consists exclusively of advertising, and the content about the creators’ lives takes place behind the paywall? Clearly a lucrative business for the creators: double revenues. For the advertisers probably less . The separation of content between freely available and exclusive does not automatically create more content. This means that individual segments will be shifted from the freely available content behind the paywall. The cooperations, on the other hand, will not decrease, so that the viewer gets the feeling of being confronted with advertising more often and with less content. This leads to a loss of authenticity, which will be reflected in performance.
On the other hand, the Instagram paywall model is still in its infancy. If it develops in a similar way to classic media, that exclusive and clearly defined content takes place behind the paywall, it will be easier for advertisers to determine the specific environment in which they advertise. As with an advertising booking on television, for example. Here, the advertiser knows which formats will be broadcast before and after his spot.
A thought experiment: “Follower” perspective
If we look at the followers themselves, authenticity is exactly the right keyword. I follow an influencer on Instagram because I find her interesting and entertaining or because she provides me with important information. Beyond that, I’m used to being provided content for free. If I then have the feeling that I’m just a viewer of a sales show, I unsubscribe from the account after a certain amount of time. Or if I have the feeling that content is only being created with the intention of extending it behind the paywall, I unsubscribe from the channel.
On the other hand, many of the Generation Z identify with the creators, some of whom are perceived as idols. What a subscription to Bravo was in the ’90s is now reflected on social media, so a subscription could well be accepted here.
At first glance, the Instagram paywall may seem attractive for creators, especially for monetary reasons. However, if the not entirely unimportant aspect of authenticity is included here, the attractiveness of the pay model drops rapidly – regardless of which side. Especially for Meta, it is not about “doing something good” for the creators, but they promise themselves data, which can be used to further advance the metaverse by a conclusion of the subscribers.
In the end, however, it’s like with all innovations in the digital world: it remains to be seen how the Instagram world will embrace the change. Finally, one thing should be said: the paywall is still a topic of discussion in the traditional media and is viewed critically by both advertisers and readers.