Why Treating Creators Just as Talent Is a Mistake | Frank Cooper III, CMO, Visa

Thank you for having me. Great to be here with you both.

I got to tell you, this is incredible. It's the inaugural Scalable Summit, and I didn't know what to expect, but the energy here is amazing. The people are great. You know, it's a space, but what makes the place are the people who come together, and you guys have really convened an interesting group of people around topics that I find fascinating. So, I've been scooping it all up since the morning.

Whoa. My god. You know, look, this is probably one of the most difficult questions because marketing, if you think of the old days when people watched Mad Men, and it was a great show and you're fascinated by the 30-second spot, it is so far away from that today, it's hard to imagine. So number one, you still have to be a great storyteller. That has not changed. But the way in which you tell stories has changed. In fact, with every new medium, there's been a new form of narrative. Every new medium, it's happened from the history of time, right? You get the printing press, you get a novel, you get a motion picture camera, you get the feature film, you get TV, you get sitcoms, you get social media, you get micro-dramas. So every new medium creates this new form of narrative. And so but you still have to be a great storyteller and the basics of story have not changed. But you also have to be a precision marketer, bringing in data and understanding how data can inform you so you can tell better stories. But you also have to design experiences. You have to create expectations. You have to build memories. You have to build relationships. All those things are necessary to be a great marketer today. Great storytelling, designing great experiences, creating expectations, building memories, building relationships. And so the big shift is really around the complexity of art and science coming together in a way that you can orchestrate that across different consumer segments, right? So you have to be able to connect the dots between them all and that can be really challenging. It's both challenging and it's not how people are trained because we just came out of an era of specialization and people are like, okay, yeah, I'm good at performance marketing, which I hate the term. The term is like the worst term ever created. Like what, some other marketing is not performance-based? All of it performs. But bottom-of-the-funnel marketing, big storytelling, used to be separate. All this is converging now. So I think that's one of the big things. Second big thing is who controls the distribution. When you had mass distribution, it was easier. I won't say easy. Nothing is ever easy, but it was easier. But now, who controls the distribution? How do ideas spread? It's hard for a brand to just pay money and then have that spread in a way that people believe it and you influence their perceptions, their emotions, and their behaviors. Really hard to do. So, here come the creators. And if you can leverage creators well, not just as a marketing channel, but as a business infrastructure, then that's a whole other realm of how you communicate with customers. And by the way, this is not something that came out as a surprise because trust in large institutions has been declining for about the past 30 years across everything, whether it's business, nonprofit, governmental, all of it's been declining. And people started having trust in strangers, people who are in their network, and creators to me and influencers are part of that shift.

I saw the early signs of it when I was at Pepsi. So I did a deal with Nicki Minaj, or you might not think of Nicki Minaj as a creator, but what she did early on, the seeds of it, you started to see things like her inviting the Barbies in for participation. You could see her having more of a conversation with them. And what became clear is that the trust that she had with her base was the asset that she was selling more so than an individual piece of music. And so she could carry that trust anywhere. I saw it early with Beyoncé. Did a deal with her also. Beyoncé was building community. And so I thought that was interesting. And then we started moving into that second era of just more formalized creators coming out of the hobby era too, where the platforms started to get more mature and working with the Lilly Singhs and others where they had influence in certain verticals. And so it moved to BuzzFeed and it became really clear, certain verticals like food and Tasty and things like that became clear, Try Guys and entertainment. And so you started seeing specialization. I tried to create something, I think it was 2012 or something like that. I called it the Creators League. And the whole idea was to build this place, much like the Lighthouse here, but not quite as elaborate as this, where creators can come in and have community and can share, but also can develop things together. It turned into something else. But that was probably at least 10 years ago. We were trying to do that. So, I saw the early seeds of it back then, but it's evolved into something different now.

Yeah. So we now look at the media budget and we take a certain percentage of that media budget and allocate that toward the creator economy as a whole. And so some of it goes toward individual creators, some of it goes toward the platforms that support creators, some of it goes toward the products that we're creating that help creators become more scaled and more competent and more capable. And so we've taken a percentage of that budget. And I think it's now at a point where it's significant. I'd say three years ago it was more experimental. Now it's a significant part of our budget.

I think for us the advantage of Visa is that we didn't look at creators purely as a marketing channel. That was one thing we looked at for sure. But we looked at them as small businesses and we said, well, how do we serve a lot of small businesses? How do we serve small businesses? And this is by the way the fastest growing segment of any business right now. So well, we serve small businesses by giving them infrastructure, by giving them knowledge, by giving them access to the tools that would help them scale. And creators, we felt the same way about it. They just had special needs. Often times it's a one-person shop that's trying to scale. They're not going to hire a finance team. So can you build financial infrastructure around them? They might be using their personal account for business, right? And so how do you allow them to transition to a business account? The number one problem for all entrepreneurs in general, but creators specifically, is cash flow. So, how do you help them manage cash flow? And so, those are things that we started focusing on and for us, we're like, hey, we do this all the time with businesses. If you thought of creators not as just talent or a marketing channel, we could actually help them scale. And so that's partly why we had that separate category, from this idea of let's engage the talent to help us spread ideas that we have.

100%.

So, I love this card because it speaks to exactly what we're talking about. So, if you're a creator, and people decide to treat you like a small business, often times they're like, okay, business, we'll pay you net 90. Basically, you have to wait 90 days to get paid. And for big companies that are paying this out, they're like, that sounds reasonable to me. For a small business, a one-person shop, that can become existential. And so getting paid faster is not just a perk. It actually becomes growth capital for you. Because if I got that money earlier, I could then reinvest it in travel or equipment or partnerships. And so getting paid quickly, that's built into the TikTok card. So think of it as a Visa debit card that has what we call Visa Direct rails in it. And with Visa Direct rails, you can get paid in 30 minutes. And so I think it's life-changing in that regard. The second thing is that it really recognizes how creators get paid. Their income is irregular. It comes from different sources. And so recognizing that and tapping into those streams as a form of credit, so to speak, I think was also critical. And then being on the TikTok platform and having that connection and converting coins and diamonds into fiat currency, I think is really a fantastic opportunity for creators. So, I'm really excited about that card.

I don't know. I hope so. I think it's inevitable that you're going to see more creator cards pop up. The need is there. And depending on what stat you look at, $185 billion for the greater economy, it's going to at least double by 2030. Some people will say it's 500 billion by 2030. Whatever number you choose, there's no segment that large that's growing at what, 20%, that is allowing personal accounts to serve as business accounts that have no financial infrastructure around it that don't meet the needs of those entrepreneurs. And so I think that gap is going to get filled and we hope we fill it.

Yeah. Look, I think you remember years ago everyone was talking about the gig economy or the creator economy. The issues are really similar when you think about it. It's like, hey, I actually have a stream of income that's somewhat irregular. It may come in the form of a 1099 or it comes in forms that don't get recognized frequently by large banks. And so I think there's an opportunity for credit card companies, payment networks, banks in general to fill that gap. And so yes, I think that it will recognize multiple revenue streams. What I love about the creator, especially on the social media creator side, is that we could talk about their reach and their connection to the audience and that's a great thing. But then they also in many cases they're developing products behind that. So now they got a product stream that's creating a separate stream of revenue. And if you can recognize that as a legitimate business and you can start to evaluate the risk associated with that type of business, which I think you can by the way, then it becomes really interesting. You'll see different types of loans come out and credit will look different for them and advancing money against their revenue streams will become a different and awesome opportunity.

Well, I mean it's controversial in the sense that traditionally when risk gets evaluated in terms of revenue, people want to see the steady revenue stream from traditional sources. That's just traditionally how it's been evaluated. Over time you're starting to see underwriting that actually encompasses a wider range. But this is new, we haven't seen this before. How do you distinguish, whether you're a bank, a payment network, a lending company? How do you distinguish a creator who's starting something up as a hobby versus a creator that is actually building a real business? How do you distinguish it? Do you look at the numbers, followers? Do you look at the engagement? What's the threshold that crosses? How long does the revenue stream have to be consistent for you to say that I believe that this revenue stream will continue? When does the fallout happen? How quickly can it fall? It's a lot of questions that you would have. But it can be evaluated. It's less mysterious today because we've seen it enough times now, particularly for creators who scale, who cross a certain level of scale. There's enough consistency in outcomes where I think it can be evaluated.

It's changed over time in the sense that I think marketers have become more precise in articulating what a return on investment looks like. There was definitely a time where marketers would say, the world of marketing is unique. You can't understand it. C-suite members, and I'm going to talk in a language that actually makes no sense to you. So, I'm going to tell you about brand love and equity and things like that and you'll kind of get it, but you'll never be fully convinced, right? And so, I feel like one of the most foundational jobs of a CMO today is translating what we do in marketing into financial terms that non-marketers can understand within the firm. And the CFO has to be your best friend in that regard. And so we've spent a lot of time with our finance partners in Visa talking through so what are the things that actually matter to you and what would be some signals that you would believe in and how can we prove that, what are the methodologies. So we went through that piece of it. We met with our business partners and when I first came on board a lot of people were saying yeah yeah we love marketing we love brand the number one reason clients want to do work with Visa is the power of our brand and trust we're at the very highest levels of it but no one knows how to translate that into financial terms. And so we created something called profitable consumer behaviors that instead of moving these marketing metrics for our business partners, let's identify what are the consumer behaviors that we all agree would be profitable. If we can move it a bit, if I can get someone to load a card into a digital wallet where it becomes a default card for them and we can show that that usage increases by X percentage, would you take that as a return on the investment? And most would say yes. And so then instead of talking about purchase intent, I'm going to talk about a wallet load and everyone can understand that. And so those are kind of some of the shifts we made is just the translation layer, profitable consumer behaviors, and thinking about what are the outcomes that really matter in our world, payment volume, share of wallet, and so we're going to translate everything back from that.

100%. If influencer marketing is not moving that, I won't do it. The good news is though you then have to ask the question, okay so what drives payment volume and share of wallet? Well, preference, different levels of preference, loyalty, advocacy, etc. Then what drives that? We think product superiority, cultural relevance, trust, usage. And the good news about influencers, and that term is problematic on some level because it's like, I don't know, anybody can fall into the category of influencer. A celebrity can be an influencer, a non-celebrity can be an influencer, somebody who can influence people's behaviors or shape their perceptions.

That's why we rebranded a little bit to creator. I think...

Creators can influence you to make a purchase or to shape your opinion of something. And I think there are a bunch of people who can influence that, right? And so you could take a business leader who just happens to be charismatic and persuasive and influences others. Would we call that person an influencer? Maybe if you dropped them into IG or TikTok or LinkedIn, you would say okay influencer, right? But what if they went to another channel and had equal influence in terms of the number of people? So I love the concept and I'm 100% a buyer of the concept of it. But to answer your question, the influence has to shape someone's perception or shift their behavior in a way that it moves something that matters to us. It's got to move people's perception. They have to either think our product is better, they have to trust us more, they have to think we're more relevant, but ultimately they have to prefer us. And on the brand side, all brands really are about shaping choice under uncertainty. And so if it's really the sum of all your beliefs that shape choice, then I need that influencer, that creator to help shape people's choice. If it doesn't do that, I can't draw the line to an outcome that really matters to the business. And so I need to draw that line. If someone says to me, 'This is the coolest creator man you've ever seen. You got to rub up next to that creator because the halo effect is going to be incredible for you.' And if it stopped there, I won't do it, right? I won't do it. But if you said to me, 'Hey, that's the coolest creator in the world.' I'd ask the question, 'So, what is that going to do for me?' You say, 'Well, you guys lack relevance with this consumer segment. This person can help transfer that relevance and trust to you because that person's values are consistent with your brand values.' I got to see that connection otherwise for me, I won't do it.