Social Audio: The Clubhouse Monetization Model Is Hiding In Plain Sight
Traditional Conferences Hold The Blueprint
Follow The Money.
That’s one thing I’ve learned from over a decade of studying social media professionally and participating in it personally. Clubhouse is fast emerging as social media’s newest darling, accelerating awareness and participation from a recent rush of high profile participants across the spectrum of culture, from Elon Musk, to Katie Couric, to Drake and Oprah. And while Clubhouse has the advantage of high profile VC support from Andreeson Horowitz, (critical to its future), funding alone will not be enough to support the longer term viability of Clubhouse as Twitter races to compete with it via Spaces, with Facebook and others likely to replicate the model. But like any other social platform, Clubhouse first has to build a sizable audience, with significant repeatable engagement before they pull the trigger on how they make money from it.
Sitting around six million, the Clubhouse audience growth numbers are more impressive when you factor in that the app is not yet available on Android and requires invites from someone already on it. Clubhouse opted for an exclusive gated approach that resembles more of a velvet roped nightclub vs. an all you can eat buffet. As a result, early adopters, the tech elite and more recently, celebrities, politicians and cultural taste makers are flocking to the platform to be seen and heard. If you go by the numbers only, one can easily conclude that Twitter, despite having Spaces in beta can reach much larger numbers as this is where so many of the above influential have spend years building their audiences. Time will ultimately tell, but Clubhouse does have a unique opportunity hiding in plain sight when it comes to how it will make money.
The Traditional Conference Model
As innovative as platforms such as Facebook, YouTube, Instagram, Snapchat etc. all seemed when they first made their mark in society, they all have something in common tied to their past success and future growth—they make the majority of their money built off the tried, true and tested advertising model and simply replicated it for their platforms. Ads worked during the print, broadcast and digital revolution and they now work for the social, mobile and app era. Clubhouse however, has a different traditional model to use as a blueprint:
One pre-pandemic report in 2019 estimated the meetings and events market at 840 billon dollars. Conferences and events are big business. As someone who started attending SXSW since 2008 and watched it grow exponentially as commenters questioned the value of attending every single year—the model, like advertising has already proven to be lucrative. In many ways, Clubhouse nearly mirrors the SXSW experience with the ability to dip in and out of rooms, and the serendipity of topics. There was a tipping point for SXSW around 2009-2010, the big companies starting coming and brought their budgets with them in the form of sponsorships in every way shape and form that a conference can support. Clubhouse is part talk radio, live podcast, but it’s also a conference on your mobile device served every single day, 24/7.
This is the low hanging fruit for Clubhouse and I can’t imagine a scenario where some version of this doesn’t happen and isn’t enthusiastically embraced by companies even when physical conferences re-emerge. A Club with large following that discuss topics dedicated to parents with young children for example, presents opportunities for a host of brands who play in that space. There are scores of B2B opportunities as topics in Clubhouse range from Digital Transformation to Content Marketing—many companies rely on customers who wither procure their products or services related to their topics. The question becomes how long will it take for Clubhouse to roll out options like Sponsored Clubs in a way that gives brands ways to spend their dollars. But the potential is great, and much like advertising—the blueprint is already in place thanks to decades of conferences before it.
On a personal note, I joined Clubhouse back in September and dipped in and out for a bit but I was cautious to take on the time commitment that comes with new social platforms. We are indeed living in an era where technology threatens our overall well-being if we let it. And the platform has been criticized for attracting the kinds of hucksters who sell get rich schemes. But these rooms and Clubs are easy enough to avoid and in the past month I have re-engaged on Clubhouse, finding time well spent when I am in the mood to expand my mind, or connect with both likeminded and unlikeminded people who I can learn new things from.
As the future of Clubhouse is debated by many of the same people who participate there, it’s worth remembering that while scaling audiences and participation is the name of the game now—monetizing will be the name of the game tomorrow and Clubhouse has a proven model to build off of.