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TikTok's latest get-rich-quick scheme is user-generated content, but it's unclear how long the gold rush will last

Aug 23, 2022, 23:26 IST
Insider
You can't go on TikTok these days without seeing dozens of posts about UGC hustles.Westend61/Getty Images
  • UGC — user-generated content — is TikTok's latest get-rich-quick scheme.
  • Creators say they're making big money making UGC, but it's unclear if the gold rush will last.
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If you could make $10k a month with a side hustle, would you quit your 9-5 job? For many, the answer is an easy yes — The promise of quick money is how many TikTokers are being lured into participating in the latest get-rich-quick scheme: UGC.

UGC — or user-generated content — has dominated TikTok's For Your Page (FYP) for months. The hashtag UGC currently has nearly 200 million views on the platform. It seems nobody can open up the platform without seeing at least one TikToker advocating for the side hustle's profitability.

The surge in this type of content creation has led to something of a "gold rush" among entrepreneurial TikTokers. UGC creators on TikTok boast about making thousands of dollars a month by producing short-form videos for brands. Accounts like UGCang and SocialCheatSheet receive millions of views and thousands of comments from impressionable Gen Zers eager to make some bank.

But many marketing pros are skeptical that the gold rush will last, warning that TikTokers are glamorizing a job that does not come easy and encouraging young Gen Zers to make risky life choices – like quitting their steady jobs in pursuit of a gig that, in fact, isn't as easily lucrative as it seems.

So what is UGC, anyway?

User-generated content is exactly what it sounds like — content created by social media users for the use and promotion of brands and products. Where influencers post sponsored content on their own pages — leveraging their own brands and personalities, UGC content is made specifically to be posted to brand pages; creators often don't even bother posting it on their own accounts.

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UGC content used to refer to content users independently and organically made about brands and products they authentically loved and used — but the term has shifted in meaning in recent years. UGC campaigns are now increasingly generated by brands.

It isn't exactly a new phenomenon, but it's seemingly exploded on TikTok in recent months as brands move away from influencer-based sponsored content campaigns in search of more "authentic" reactions to their products. UGC has seen rapid growth over the past 12 months, Louisa Warwick, founder of social media marketing agency Social Acceleration Group, told Insider.

"UGC helps create brand authenticity, a higher level of trust in the product or service, a sense of community loyalty," she said. "In the creator space, we used to see brands requesting influencer partnerships, now we're seeing an all-time-high number of requests from brands for UGC."

When it comes to influencer partnerships, brands lean on the influencer's large following so their products can be seen by more eyeballs. But UGC doesn't necessarily require a huge number of followers because brands are hiring creators for their content, not their followings. Many UGC evangelists on TikTok actually claim that you don't need any followers at all to be a successful UGC creator.

Instead, they say being a successful UGC creator is as easy as creating a portfolio of work examples and then competing for jobs on freelancing sites like Fiverr, Upwork, and Billo.

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Annalyse Cordon, a media manager and UGC creator, told Insider it's not unheard of for a person to comfortably make five figures a month doing UGC, but that successful creators have usually spent a long time building up skills and relationships with brands. And they often have clients on long-term retainers rather than one-off projects.

"It is a little concerning to think that someone who has never done a single piece of content before could be told and sold on the idea that within the next couple of months they'll be making $10k a month with nothing else under their belt," she said. "Again, nothing impossible but that's a big hill to climb."

When Insider perused Upwork for UGC creator jobs, the vast majority of the 127 available UGC jobs had rates of between $10 and $100, with a few outlier postings listing gigs for $1,000 or more.

Teaching others how to make UGC is how many UGC evangelists actually make money

While some TikTokers do make money by producing UGC content, many of them actually make their money by teaching courses on creating UGC.

Several reportedly successful UGC creators have begun selling beginner courses or kits on how to get started in the side hustle.

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But Misty Lam, CEO and founder of aestheticreative Marketing, said its unclear whether these "self-proclaimed gurus" primarily make money from creating UGC or make the bulk of their income from selling courses.

"Because there is no way to prove if someone actually has serviced clients as a UGC creator or social media manager, many people have come out saying that these programs didn't teach them much or that they felt scammed," Lam said.

Taylor Loren, a former marketing director of Later.com and former head of marketing of Girlboss, says she's wary of the "multi-level marketing vibe" given off by some of UGC's staunchest supporters.

"[There's] a 'get rich quick' kind of vibe," Loren said. "It's a very new space, and there's not a ton of expertise available for it. So it's a little bit hazy on who you can really trust."

TikToker Crystal Harris recently broke down exactly how one "UGC creator" bragging about their big paycheck actually made their money. The TikToker claimed that they made $6,000 from UGC, so she went to their profile and saw they were selling a "cheat sheet" for $150.

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"Which means out of the 20,000-ish average views that they get, they only had to sucker in 40 people to make $6,000," Harris said in her TikTok. "It's a scam. They don't make money through content, they make money through selling you the idea of creating content."

Loren believes online courses can be helpful, but that TikTokers need to make sure the person they're purchasing a course from is a trusted expert.

"You need to go further than just watching a few TikToks from somebody," she said. "You need to be looking at their work experience, looking at the clients that they've worked for if you're going to purchase a course and want to quit your job to pursue this."

The lack of transparency around how UGC creators actually make their money has left many skeptical of the 'gold rush'

Marketing pros warn UGC creators often aren't transparent about how they actually make their money.Getty Images

While one glance at the #UGC hashtag on TikTok makes it seem every UGC creator is a success story, professional marketers are warning Gen Zers of the trend.

"UGC Content Creation. Is it a Scam?" reads the overlay text in one of Courtney Park's TikToks. The freelance social media manager and tech worker posted a video about the trend in July.

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Park worries about the picture UGC creators are painting of the career where they promise young viewers that the job doesn't require any expertise as long as you have a laptop/phone.

"I think that's like a really simplified way of talking about things," Park told Insider. "Content creation is definitely a real thing, and it can be very profitable, but you need certain expertise. You need to know how to take good quality videos. You need to know how to create content that actually converts."

She claims most of the UGC creators advocating for the side hustle never truly show data and proof to back up their expertise.

"There's no transparency behind those videos," she said.

One of the most popular pro-UGC videos on TikTok implies that UGC is worth quitting your job over — and that's where the danger lies, Loren told Insider.

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"I would caution people against going all in on it, just because of where we're seeing brand budgets going right now, a lot of weekly contractor budgets or influencer budgets are starting to get cut and reduced at brands," Loren said. "Right now, I would be a little bit hesitant to people who are just listening to a TikTok saying you can make $10K a month."

Instead, Loren advises trying out content creation on weekends, or as a side hustle first.

"It's still a skill like any job. Not everyone is gonna be able to create beautiful, captivating, engaging content. That takes a certain eye," Loren said. "If everyone could create beautiful content that converted, we would all have millions of followers."

"Often times I think the outliers are the loudest," Cordon said. "So it's the people who maybe did get lucky, but it's a very different journey for every person."

While Cordon agrees content creation is a great option for people with creative and niche interests, she believes TikTok has glamorized it to make it seem like it doesn't require hard work. Some TikTokers are now coming clean about the fact that their plans for a lucrative UGC career haven't worked out how they expected.

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And others are admitting that their success is largely due to the fact that they'd previously worked in social media and understood what brands were looking for.

"I do think that UGC, as we see it right now in 2022, has just been repackaged as something for Gen Z to eat up as this cool new trendy side hustle," she said.

Park, the social media manager, recalls many accounts that simply fizzled out because they started UGC and realized that it was a lot harder than they expected.

"For those that were looking for a get rich quick scheme, then they're probably not gonna make it," she said.

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