What is a UGC Creator? Everything Brands Need to Know

February 12, 2023

In the early days of influencer marketing, follower count was the north star. If someone has 1 million followers, they must have purchasing influence over a loyal audience, right?

Not quite.

In one case, an Instagram influencer with over 2 million followers failed to sell 36 tee shirts to her community. Between fake followers and highly edited, overly promotional content, many of the largest accounts on Instagram have painfully struggled to build real relationships with their audiences.

Enter user-generated content.

The rise of TikTok and short-form video content has transformed the brand-consumer relationship. Feeling the pressure from rising paid advertising costs, brands are now turning to customers, brand evangelists, and smaller creators to produce authentic content that builds trust and honesty while driving awareness and meaningful revenue.

If this seems foreign to you, don’t worry. We’ve got you covered.

In this guide, we’ll cover the who, what, and how of UGC creators, giving you everything you need to start sourcing and hiring creators for your brand.

But first, a definition.

What is a UGC Creator?

A UGC creator is responsible for producing any type of user-generated content, from free word-of-mouth unboxing videos and written reviews to paid UGC created on behalf of a brand for use across social media.

Whereas most brands previously chose to pour money into an overly-promotional influencer campaign with a big-name celebrity, marketers are shifting towards working with micro and nano-creators to produce raw and authentic content that deeply resonates with a brand’s target audience. Gone are the days of photoshopped direct-response influencer ads. Consumers want real content, from real people. 

Here’s a perfect example of a TikTok created for Open Farm by UGC creator and agency owner Sheridan Holland.

https://twitter.com/ShevHolland/status/1619108170864988161

Pro tip: Always include the doggos.

The Rise of UGC Micro-Creators

Micro-creators are content creators with anywhere between 10,000 and 100,000 followers on a given platform. Meanwhile, nano-creators have anywhere between 1,000 - 10,000 followers. But don’t be fooled, small doesn’t mean ineffective.

Given the smaller audience size, micro-creators are able to engage with their supporters on a deeper level, many times even giving them the one-on-one attention that many larger influencers simply can’t provide. This authenticity builds trust with their audience which directly translates to purchasing influence.

And brands are taking notice. According to an Insider Intelligence report, as outlined by TechCrunch, “nano” influencer spending will rise 220.5% in 2022, while “mega” influencer spending (creators with 1 million+ followers) will grow only 8%.

Thanks to the power of the TikTok algorithm (and Instagram’s prioritization of Reels), anyone can go viral at any time. No matter how large or small the follower count. Quality content is the great equalizer.

Brands like Tabs are living proof. In the last year, the sex chocolate company has generated millions of dollars in revenue driven heavily by its robust UGC operation.

In a conversation, with Harry Dry of Marketing Examples, Tabs co-founder Oliver Brocato shared that Tabs works with over thirty nano-creators at once, each posting 1-3 times per day, on separate TikTok accounts. With hundreds of videos with over a million views, Oliver credits its success to sheer output. Each video is a new shot on goal.

“No one knows what the algo is going to like. So don't look for the needle in the haystack. Cop the whole haystack, and you'll get the needle,” says Brocato.

As you can see, this video looks nothing like an ad. Instead, it drives curiosity through authenticity, entertainment, and a twinge of controversy.

What makes UGC Creators so effective?

Two words. Social proof.

Consider these facts:

• • 88% of consumers trust user reviews as much as personal recommendations.
• • 2 out of 3 people say they’d be more likely to make a purchase after watching a testimonial video demonstrating how a business, product, or service had helped another person like them
• • Consumers find UGC 9.8x more impactful than influencer content when making a purchasing decision
• • Word of mouth marketing generates more than twice the sales of paid advertising
  

UGC is even taking over paid advertising. According to RealEyes Quality Score, brand and user-generated TikTok videos outperform Facebook and conventional ads. TikTok UGC videos scored 22% higher than TikTok brand videos, 32% higher than Facebook ads, and 46% higher than conventional ads.

Acknowledging the opportunity, many brands are now repurposing effective organic UGC as paid performance ad creative across platforms like Facebook, TikTok, and Instagram. While these rights need to be discussed upfront when negotiating with UGC creators, this is a cost-effective way for budget-sensitive brands to make the most of their UGC assets.

How Can Brands Determine the ROI of UGC?

It depends.

Ultimately, it boils down to your brand's overall marketing goals. Those looking to solely drive brand awareness can very easily measure the effectiveness of UGC based on engagement-based metrics like views, interactions, and engagement rate. Brands focused on growth marketing should likely benchmark against in-house performance metrics like CTR and CPA.

TikTok Creator Strategist, Aurian Valcin, urges brands to start slow when working with new UGC creators. This gives both parties an opportunity to test both the content and the nature of the working relationship.

“It can be helpful to do a test run with a creator to see how content performs from a brand awareness standpoint (e.g, engagements, brand sentiment, etc.) and determine if there may be an opportunity to create a longer-term partnership,” she said. “It often takes a bit of time to see conversion across multiple channels so brands also need to be patient.”

Rates are also highly variable, dependent on a number of factors, including engagement rate, partnership length, exclusivity, multi-channel use, and more. Factors like industry, niche, and product type also play a role.

Given the demand for high-quality UGC, pricing is all over the map, with micro-UGC creators charging anywhere from $50-$1,000 per video. As you scale your content operation, it’s important to map your content goals and determine how you calculate ROI. Let this inform your budget, which will likely set the direction for your creator outreach.

While most UGC creators strongly prefer cash, compensation can come in many forms. Some brands with high-ticket products may base an offer mostly around free product value, while other brands with larger audiences will attach value to brand exposure (collaboration value) or access to a brand’s audience (audience exchange).

How to Find UGC Creators at Scale?

With waves of new UGC creators popping up daily, there’s no shortage of talent. But the real question is how do you find creators who fit with your brand?

Valcin notes that brands often overlook a key source of relevant, quality UGC creators: Their existing follower base.

“There's a good chance that multiple UGC creators already follow your brand on social media, or they are discussing it organically and using relevant hashtags to bring awareness. There's also a good chance they have other creator-friends who love your products,” she said. “Try not to focus too much on following, but rather on the quality of their content, consistency in posting and how engaged their community is.”

In addition to cold outreach, there are plenty of other ways to source relevant UGC creators.  From creator platforms to marketing agencies, and especially Twitter, usually a few hours of searching will yield some pretty incredible results. Larger brands have also launched their own TikTok challenges, encouraging users to film a video of them completing the task tagged with a branded hashtag. Chipotle’s #ChipotleLidFlip campaign did some serious numbers.

With Bounty, we help brands tap directly into their existing customer base to source and automate high-quality UGC. After a customer receives their product, they can post a TikTok and earn cash based on the video’s performance. From there, brands can pay the UGC creators for the rights to use this content as a Spark Ad. These people have already purchased your product and (hopefully) will have great things to say, so why not have them shout it from the rooftops?

How to Manage UGC Creator Relationships?

While working with a wider net of UGC creators means more shots on goal, it also means more project management and longer working timelines.

The secret to success? Patience.

Brands often shoot themselves in the foot by rushing the process and setting unrealistic expectations. Contracting the right UGC creators, seeding products, and briefing them on the content guidelines can take a week or two.

Once the groundwork is done, it’s time to let the creators cook. This means avoiding the urge to jump in with creative ideas or polish the content.

The key, says Valcin, is building ample buffer space into all working timelines and working with UGC creators to agree on realistic due dates.

“Creators are often working with multiple brands and have several deadlines to adhere to, while still being normal people with families, random emergencies, or even 9-5 jobs,” she said. “Setting realistic timing expectations with internal teams and giving creators more than a few days to turn around content usually provides a happy result for all parties involved.”

At the end of the day, it all boils down to relationships. Treat your UGC creators as you would any employee, and don’t be afraid to go above and beyond with a hand-written note or a custom product package. Who knows, this may even be enough for the creator to make their first video simply out of their love for your product.

So, how do you feel? Ready to get started? If you’re a Shopify merchant looking to automate your UGC and creator marketing for 90% cheaper than an agency, try Bounty for free today.