Addison Rae and the D’Amelio sisters, Charli and Dixie, are among TikTok’s biggest stars. The teens have amassed tens of millions of followers on TikTok, one short dance routine or slice-of-life video at a time. They have parlayed that audience into millions of dollars, working with boldface names like American Eagle and Dunkin’ Donuts, eager to sell to their Gen-Z fans. But while they’re the faces of TikTok, their emerging influencer empires are growing on another platform, dreamed up in Ottawa.
Like celebrities of every era, social media stars are lending their image and following to products via endorsements and collaborations. But a growing cohort of content creators are launching their own beauty and apparel lines, enabled by third-party vendors and managers handling tasks from design to fulfillment. And many are doing it on Shopify, the e-commerce firm driving a cross-category explosion of direct-to-consumer (DTC) brands.
Influencers with large followings on TikTok, Instagram and YouTube are increasingly launching their own direct-to-consumer brands in categories like beauty and apparel, aiming to retain more of the profits and creative control than they would in traditional endorsement deals. Ottawa-based Shopify is riding that wave, hiring a well-connected executive to run its creator program and adding tools to help social media stars sell to their fans.
Today’s TikTok stars, like their Instagram-influencer and YouTuber peers, are looking to diversify their sources of revenue beyond their social media presences. Timing matters, as they know all too well. Rae and the D’Amelio sisters built their audiences in a matter of months, and they’ve moved to monetize them just as quickly. Shopify makes that easy: social media stars or their partners can quickly set up a store to sell eyeshadow or hoodies, just as thousands of other new DTC businesses have done.
Creators can move faster, maintain greater artistic control and keep a greater share of the profits with their own brand than in a product collaboration with an established retailer, said Evegail Andal, CEO of Matter Media Group, a Los Angeles-based influencer-management firm.
“There has been a wildfire of different creators really going off [on] their own,” said Andal. Matter’s roster includes Alisha Marie, who has 8.21 million YouTube subscribers and 3.6 million Instagram followers, as well as the Brampton, Ont.-raised Adelaine Morin, with 2.56 million YouTube subscribers. Both sell T-shirts, joggers, sweaters and other goods through their own Shopify stores.
“If we wanted to launch [a client’s] merchandise line in the winter of 2020, we’re definitely able to do so,” said Andal. “[With] a large retail brand, we would have to present them with something right now to talk about an early 2022 launch.” Equally important, DTC success can help convince major retailers to carry the creators’ brands, which many ultimately want; her firm also places clients in more traditional brand campaigns.
Social media stars have a ready audience for their products, making them ideal Shopify merchants. “The difficulty in creating a brand for e-commerce websites is gathering the demand,” said Atlantic Equities analyst Kunaal Malde, who covers Shopify’s stock. “If you’re already an influencer [with] people coming directly to you across different channels, then you’ve got a strong head start.” That means better margins, since they don’t have to spend as much on marketing.
Creators can call on an ecosystem of helpers to develop and run their merchandise operations. Matter advises clients on design and brand strategies, and finds vendors who handle manufacturing, website development and order fulfillment. In the beauty space, third-party cosmetics companies have been increasingly willing to work with creators over the last two or three years, said Andal; some influencers also seek cosmetology training or get certified as makeup artists to learn more about the category. When Madeby Collective created Rae’s Item Beauty line, launched in August, the influencer reportedly participated in all the major creative decisions.
Creator clothing brands often have a similar setup, with a few successful companies creating products for several different influencers. “We’re a silent partner to the artist,” said Ashley Vaiana, director of account management at Absolute Merch, which makes apparel and accessories for musicians and influencers, including YouTube comic Megan Batoon. The company takes a cut of online sales until its bills are paid, but influencers don’t sign long-term contracts, and they retain the rights to their graphics and artwork. Fans don’t always grasp the distinction between front person and brand: “Customers like to give feedback directly to the artists, as if they are the ones personally … packaging orders and running customer service,” said Vaiana.
Absolute Merch uses Shopify for its own multi-artist website, as well as for clients who want their own online stores, because the platform’s analytics tools make it easy to see which products are selling well, and third-party integrations allow the company to showcase products to fans consuming content on Spotify and YouTube. Clients are given access if they want it. “I can’t say that I would recommend giving logins to artists on any other platform than Shopify,” said Vaiana, citing its ease of use. Influencers are increasingly hands-on, checking which items customers are clicking on and searching for.
Shopify’s user-friendly interface and the fact that many third-party vendors are already running shops on the platform has led stars from all the biggest social media platforms to sign up. Instagram influencer Arielle Charnas’s clothing company Something Navy and YouTuber Jenn Im’s Eggie line are on Shopify. Wakeheart, a fragrance and candle brand co-founded by Vine-turned-YouTube stars Ethan and Grayson Dolan, is on Shopify. Holo Taco—a polish line launched in July 2019 by Ottawa-based Statistics Canada analyst Cristine Rotenberg, whose Simply Nailogical YouTube channel has 7.67 million subscribers—is on Shopify.
The e-commerce platform doesn’t disclose its merchants’ merchandise sales volumes by categories or type. But as with endorsements, top social media stars’ earnings can range widely. In November 2019, Jeffree Star and Shane Dawson—leading lights of beauty YouTube, a section of the video site devoted to makeup tutorials—launched Conspiracy, an 18-shade eyeshadow palette priced at US$52. Cosmetics executives estimated the single product could generate US$17.5 million in revenue on Star’s online store, which is on Shopify. They may have hit a supply-chain snag—in July, manufacturer Morphe stopped working with the duo after other YouTubers highlighted previous racist content they’d posted.
Shopify’s most famous merchant is perhaps Kylie Jenner, who has the fifth-most-followed account on Instagram: 196 million loyal fans, per analytics platform SocialBlade. Her eponymous cosmetics line—launched online in November 2015 and now also available at beauty chain Ulta—had net revenues of US$177 million in the previous 12 months, acquirer Coty reported in November 2019. Kylie Cosmetics is serviced by Shopify Plus, the company’s Waterloo, Ont.-based division, which caters to its largest merchants. Jenner’s brand was among Shopify Plus’s top merchants as of last year, though not its biggest, said a former Shopify employee to whom The Logic granted anonymity because they were not authorized to speak publicly about their time at the company. “It’s the flag you wave because everybody knows it.”
Many creators come to Shopify organically. Stock analyst Malde said the strength of the product, integrations with other sales channels and relationships with third-party developers make it a go-to platform for DTC brands. But Shopify is starting to lean into the influencer opportunity. This month, the company hired Jon Wexler, a longtime Adidas marketing executive who most recently led Kanye West’s Yeezy brand, as vice-president of its creator and influencer program.
The e-commerce company declined to make Wexler or Shopify Plus general manager Loren Padelford available for an interview for this story. But Malde predicted that the influencer program could include Shopify serving as a broker for its merchants to connect with social media stars, particularly those of lower celebrity status than a Kanye or a Kylie. “There’s a lot of tier-two [and] -three influencers [whom the company can use to] build a decent channel and … get brands [on the platform] to advertise through that,” he said, calling such viral marketing an efficient and cost-effective customer-acquisition strategy.
Wexler’s track record with the biggest stars is impressive—he “changed the game with our adidas deal,” West tweeted, following news of his move to Shopify; Yeezy had an estimated US$1.3 billion in revenue in 2019. His arrival could make Shopify a draw for other names, both famous and less famous.
Share the full article!Send to a friend
Thanks for sharing!
You have shared 5 articles this month and reached the maximum amount of shares available.Close
This account has reached its share limit.
If you would like to purchase a sharing license please contact The Logic support at [email protected].Close
Share the full article!
Share the full article with your friends. Recipients will be able to read the full text of the article after submitting their email address. They will not have access to other articles or subscriber benefits.
You have shared 0 article(s) this month and have 5 remaining.
Shopify is also working on tools that could help influencers sell their own products, or earn affiliate fees by marketing for other brands. An integration with Facebook allows merchants to apply product tags to photos on Instagram, while TikTok is testing allowing users to embed shopping buttons in videos, linked to Shopify stores.
Its timing couldn’t be better. As the Trump administration threatens Tiktok’s access to American teens in a bid to bring it under U.S. corporate control, the app’s biggest stars are increasingly looking to other platforms to grow their followings and revenues. Shopify’s roster of influencer brands looks set to expand.