Next in Media: Why Ad Tech Might Finally Get a Piece of That Creator $

Release Date: May 21, 2025
Host: Mike Shields
Guest: Connor McKenna, Partner at Luma Partners

Introduction

In the May 21, 2025 episode of Next in Media, host Mike Shields delves into a transformative discussion with Connor McKenna, a partner at Luma Partners. The episode, titled "Why Ad Tech Might Finally Get a Piece of That Creator $," explores the evolving landscape of the creator economy and its intersection with ad technology. Connor shares insights from Luma Partners' recent DMS event, highlighting the underutilization of creator-driven content by brands and the potential shifts that could reshape this dynamic.

The Underspent Creator Economy

Connor McKenna kicks off the conversation by addressing a critical observation from Luma Partners' DMS event: "brands are way underspending on creators despite the massive amount of time people spent with their content" (00:35). He emphasizes that while the creator economy garners significant attention, there's a substantial gap in how brands allocate their advertising budgets towards creators.

Time Spent vs. Advertising Spend

Connor elaborates on the disparity between the audience's engagement with creator content and the actual investment from brands. "Creators have, as an aggregate, 20 billion of spend compared to 200 plus for the platforms that are all reliant on them" (04:56). This statistic underscores the immense potential for ad tech to bridge this gap by facilitating more efficient and scalable connections between brands and creators.

Converging Media Platforms and Creator Fragmentation

A significant portion of the discussion centers around the convergence of various media platforms and the resultant fragmentation of creators. Connor explains how platforms like YouTube, Meta, TikTok, and Connected TV (CTV) are increasingly intertwining, particularly around video content. "There's a perfect convergence of all this and what is underlying, you know, YouTube but creators" (03:42), he notes, highlighting the shift from siloed platforms to more integrated ecosystems.

Impact of AI and Media Consumption Shifts

Connor identifies AI and changing media consumption habits as pivotal factors influencing this convergence. "Media consumption is a very interesting part. And that's where the creators come into this, where we're both converging around types of formats at the same time that we are, you know, getting more and more fragmentation around creators" (02:11). These technological and behavioral shifts are creating new opportunities for ad tech to tap into the creator-driven content landscape.

Challenges in Integrating Creators with Ad Tech

Despite the evident potential, several challenges hinder the seamless integration of creators into the ad tech ecosystem. Connor points out issues related to workflow inefficiencies, brand safety concerns, and the difficulty in measuring ROI. "It's not super scalable today. Right. You can't go execute, you know, massive buys across a wide range too easily" (09:48), he explains, emphasizing the need for more streamlined processes to facilitate large-scale creator collaborations.

Historical Attempts and the MCN Days

Reflecting on past efforts, Connor references the era of Multi-Channel Networks (MCNs) on YouTube, which struggled to drive significant value despite managing numerous creators. "MCNs didn't drive YouTube. The thousands and thousands of UGC creators really did, you know, in the early days" (12:47). This historical context highlights the complexity of monetizing creator content through traditional ad tech models and underscores the necessity for innovative approaches.

Opportunities for Ad Tech in the Creator Space

Connor is optimistic about the evolving landscape, citing several emerging trends that could catalyze the integration of ad tech with creator-driven content:

1. AI-Driven Optimization: AI can enhance workflows, streamline content creation, and improve the measurement of advertising outcomes. "With AI, there's going to be more and more opportunities to measure that in unique ways where you can drive that and then also, you know, make the workflows that much more efficient" (11:02).

2. Cross-Platform Campaigns: As creators distribute content across multiple platforms, there's a growing need for ad tech solutions that can facilitate "media buys across platforms all at once through a creator" (05:42). This cross-platform capability can provide brands with a unified approach to leveraging creator content.

3. Enhanced Measurement Metrics: Developing standardized metrics to assess the ROI of creator-driven campaigns is crucial. "How do you tie creator spend to user acquisition costs so that you can buy it in the same way you might buy performance advertising?" (11:02).

4. Creator Empowerment: Empowering creators with tools to manage their monetization strategies beyond platform-controlled mechanisms can unlock greater value. "Creators are going to start to just demand to be a bigger piece of the conversation and start thinking themselves in that way" (08:25).

The Role of Regulation and Market Dynamics

Mike Shields raises an intriguing point about the potential impact of regulation on the ad tech and creator economy. Connor responds by acknowledging that while regulation could introduce new dynamics, platforms like Google and Meta will continue to hold significant control over data, audiences, and AI capabilities. "They control the data, they control the audiences, they control the, you know, the AI underneath" (21:15). However, he also suggests that regulation might spur the development of third-party tools that enhance the integration between brands and creators.

Future Investment and Market Trends

Looking ahead, Connor anticipates a surge in investment towards platforms and technologies that facilitate seamless creator-brand collaborations. "There's going to be, you know, there's so many creators, can be a million different experiments to be run" (15:44). He expects both new startups and existing players to innovate in areas such as automated workflow management, advanced measurement tools, and comprehensive buying platforms that operate across multiple social media channels.

Conclusion: A Transformative Opportunity

The episode concludes with Connor stressing the vast untapped potential within the creator economy for ad tech to harness. "There's a lot of power that they wield on intent from consumers" (22:13), he asserts, highlighting the critical role creators play in influencing consumer behavior across diverse platforms. As the media landscape continues to evolve, the synergy between ad technology and creator-driven content stands poised to redefine advertising strategies, offering brands unprecedented opportunities to connect with engaged audiences.

If you enjoyed this detailed exploration of the intersection between ad tech and the creator economy, be sure to subscribe to Next in Media for more insightful discussions with industry leaders shaping the future of media, marketing, and advertising.