Outlandish's Response to me regarding the new Brand Adspend policy
Here is an explanation as to why brands reduce commissions during ads spend and how creators actively benefit from it. - Cost Breakdown for Sellers: Sellers pay multiple costs when running ads; creator commissions (e.g., 20%), ad spend (e.g., $10), and platform fees (e.g., 10%). These combined expenses often result in sellers losing money. - Sellers’ Hesitation to Advertise: Due to the high costs, many sellers refuse to run ads on creators’ videos, reducing the videos’ potential reach and sales impact. - Importance of Profit Margins: Sellers need a 60%+ profit margin to justify running ads. If creator commissions are lower, sellers can afford to spend more on ads, leading to higher exposure for creators’ content. - Double Attribution: With ads, sellers are essentially paying twice, once for creator commissions and again for ad spend. Reducing commissions balances the cost and makes advertising viable. - Better Outcomes for Creators: More ad spend on shoppable videos means greater reach, increased sales, and potentially better long term partnerships with sellers.