Why do Creative Industries Need Digital Platforms?
The analytical center NAFI and Google, with the support of the Federation of Intellectual Property and the Federation of Creative Industries, conducted a study and presented a report on the role of digital platforms – marketplaces, video hosting sites, social networks and other services – in Russian creative entrepreneurship.
The authors conducted an online survey of 3,000 respondents engaged in various types of creativity, interviewed 1,008 creative entrepreneurs and top managers of creative companies, conducted 12 focus groups, and took 13 in-depth interviews with experts in the field of digitalization. The task of the researchers was to find out how much digital platforms are in demand among businesses, including creative ones, how the pandemic affected the operation of platforms, what forms of government support are needed for businesses working with platforms, and what is the role of platforms in the development of export potential.
The study showed that the rapid growth of digital platforms meets two main trends of modern society: the transition from a hierarchical organization to a horizontally networked one, as well as “overturning the scale of values”: if earlier material products were at the forefront, now the results of intellectual activity come to the fore …
President of the Federation of Intellectual Property Sergei Matveev notes that platforms were able to create infrastructure for creative industries: “For creative industries, platforms are a natural tool of existence. It is platforms that respond both to the challenge of a horizontally networked organization and to the growth in the value of the results of creativity. Platforms allow you to do the most important thing: create new creative results, use them as part of a product and, most importantly, bring this product to the consumer. ”
Among the advantages of platforms for business, in addition to the obvious cost reduction, the following were identified: expanding the audience, attracting new customers through targeted advertising opportunities, simplifying the export of creative products, convenient mechanisms for protecting intellectual property, as well as effective logistics solutions and ease of exporting.
According to the study, 82% of small and medium-sized businesses highly value online platforms for flexibility, versatility, and customer feedback. Moreover, it is precisely the use of platforms that has helped many creative companies survive the pandemic. Businesses that received more than 70% of their revenue from online not only survived, but also increased their income, hired new employees, and raised salaries.
Digital platforms generate an average of 27% of revenue for creative companies. Every third respondent said that the share of the use of platforms in the revenue is 35%. Similar trends can be recorded globally. Thus, according to the SMB Group, the growth in the profitability of companies that have invested in digital transformation is 18%.
Platforms play a special role in export. Of those Russian creative companies that carry out export activities, 69% do it through digital services or a combination of online and offline channels. Moreover, 46% of exporters have almost half of their export earnings from digital platforms. According to estimates of creative entrepreneurs, in the first year of entering international platforms, revenue increases by 40%, and in the first five years – by 80%.
Key regions are consumers of the Russian intellectual product: the CIS (it accounts for 71% of total exports), the EU (51%), as well as the countries of North America (21%). As for the content, according to Google, 60% of the time spent watching Russian videos falls on foreign viewers.
The pandemic has become the point of change for creative entrepreneurs. 76% of respondents experienced difficulties, 50% noted a decrease in revenue. At the same time, those creative entrepreneurs who used digital platforms suffered less from the consequences of lockdowns. Companies with more than 70% of online revenues have seen an increase in demand for business products and services, an increase in company revenues, an increase in the number of employees and an increase in their salaries.
Andrey Krichevsky, Chairman of the RUIE Committee on Intellectual Property and Creative Industries, emphasizes that platforms are becoming a sustainable institution. “The platform economy is gradually emerging from the“ Wild West ”state. First of all, this means that the platforms understand their role as an assistant for solving business problems of market participants. At the same time, the platforms are moving towards an awareness of the need to largely be the conductors of state policy, because the state is the guarantor of compliance with the legitimate interests of all participants in society. The search for the golden ratio in the work of platforms is often very thorny and requires constructive motivation from all parties, “he said.
The RAFA is preparing to launch its brand-new social platform for Russian author’s animation, where the best cartoons of Russian authors will be presented. The project “Social platform for children and parents, uniting and popularizing the best works of Russian author’s animation for 30 years” is carried out using a grant from the President of the Russian Federation provided by the Presidential Grants Fund.