Dirt: Influencer capitalism / TikTok stores / Girlboss blog
Terry Nguyen, Dirt’s senior staff writer, helms our dispatch, recapping the latest news in digital culture. This week: the influencer economy, buying stuff on TikTok, and the archived Tumblr of an FTX-adjacent figure.
P4P: Promote For Profit
For New York Magazine, Malcolm Harris writes about the impact of “influencer capital” on the market. Influencer capital, while a relatively modern term, stems from the 20th century concept of “promoter’s profit,” first introduced in the 1910 text Finance Capital. The premise is quite simple, Harris explains: “If you’re famous, someone will want you to promote their stock, and if you promote a lot of stocks, you might find yourself getting famous all on your own — as well as very wealthy.”
Thanks to the attention economy, anyone with a semblance of clout can parlay it into profit. The profit margins are, of course, relative to one’s level of fame. A-listers are almost guaranteed a major payout: George Clooney sold his Casamigos tequila brand for $1 billion. And celebrities are not just endorsing products; many also have ownership stakes in the companies they’re promoting. Influencers, too, have become the favored promoters for direct-to-consumer goods and fast-food “ghost kitchens.”
With the help of promoters, consumer brands can gain enough hype to be acquired for a hefty sum, which will eventually be turned into a multibillion dollar IPO valuation. We’re seeing this strategy applied to venture-backed projects like MrBeast Burgers, Magnolia Bakery, Blank Street Coffee, &pizza, and many many more. The product or the food doesn’t have to be good. Consumers don’t even have to buy in. “The promoters,” Harris concludes, “want our attention more than our cash.”
Speaking of attention equating to sales: Last week, TikTok began quietly testing an in-app shopping feature in the United States. TikTok Shop has previously been available in the UK and a handful of countries in Asia, but its expansion into the US market is significant for American businesses and users. The timing also coincides with the holiday shopping season. Select merchants can sign up to sell directly on TikTok, which will claim 5 percent commission on each in-app sale, similar to Instagram.
Since the pandemic, TikTok has emerged as a hub for viral product recommendations, from drugstore beauty products (CeraVe moisturizer, Maybelline mascara) to household knick knacks (sunset lamp, avocado slicer). An item can blow up overnight and quickly sell out — and this was before TikTok began integrating a commerce function. TikTok’s interface will likely be updated to promote the new feature, but shopping is already so native to the app that not much has to change for users to adopt it. Instagram, on the other hand, entirely revamped its feed — to the ire of creators and users alike — to push Shops. TikTok is not just a video app. With plans to build out product fulfillment centers in the US, TikTok is placing itself in direct competition with Amazon and other e-commerce giants.
Read Gawker’s Tarpley Hitt for the definitive explainer on the now-deleted Tumblr accounts rumored to be run by Caroline Ellison. Ellison is the former CEO of Alameda Research, a trading firm co-founded by Sam Bankman-Fried that served as the sister company to the cryptocurrency exchange FTX before Bankman-Fried shut it down last week. The intertwined relationship between FTX, Alameda, and its executives has seemed highly suspect to insiders, but last week’s implosion unveiled the strange social dynamics lurking behind the scenes.
Members of FTX, including Ellison, lived together in the Bahamas in the same house (presumably for tax avoidance purposes), shared a therapist, and were allegedly involved in a polycule, which is where Ellison’s (alleged) Tumblr comes into play. In one post, the user behind the “worldoptimization” account, which has been linked to Ellison’s Twitter, likened “the only acceptable style of poly” to an “imperial Chinese harem,” in which every participant creates a public sexual ranking of their partners. There’s no way to tell if Ellison* was oversharing in earnest (#crypto social conservative blogging) or if she was making a joke. Regardless, the blogs are preserved on WayBack Machine and an anonymous blog called “Milky Eggs” for your reading pleasure. Apparently, Ellison also had a pretty active GoodReads account.
Twitter has already seized upon the juiciest parts from the “worldoptimization” archive. Hitt has also highlighted some questionable tidbits from the Tumblr (notably the suspect observations about race science), but my takeaway is that Ellison’s* tastes are quite normal, despite her moral deviance. She’s a self-professed Swiftie and “insufferable finance bro” who takes fiction recommendations from Bloomberg Opinion columnist Matt Levine. (Has someone told Levine and Matthew Yglesias that Ellison and co. are fans of their work?) In my opinion, she should’ve stuck to sconeblogging. — Terry Nguyen
Need more Dirt? Here are some recent staff favorites: