How Gushcloud defied the odds by growing and staying profitable amid a pandemic

The pandemic has hit the influencer industry hard. Even though media consumption has gone up, brands pulled back on marketing, depriving influencers of the means to pay for the content they create.

But Gushcloud claims to have bucked that trend, with its revenue shooting up by a single-digit percentage from 2019 to 2020. The agency turned profitable in the fourth quarter of 2020 and is on track to stay in the black in Q1 2021, says Althea Lim, group CEO of Gushcloud International.

The Gushcloud team / Photo credit: Gushcloud

She claims that in contrast, many influencer agencies saw revenue fall as most of their clients are small and medium-sized enterprises, which took a beating last year. The entertainment industry, Lim explains, has an “80-20 market”: 20% of the top talent take 80% of the branded content deals.

“Currently, more than 80% of our projects come from branded content. And clients prefer to work with the premium talent, which is the focus of the Gushcloud talent roster,” she adds.

But it’s not just increased content consumption that’s sustaining the influencer industry. Covid-19 has sped up ecommerce growth by up to six years, and this has opened up a new revenue source for influencers and their agencies: live commerce, or selling products through livestreaming.

Staying afloat

Part of Gushcloud’s revenue surge in 2020 came from content channels led by its talent pool.

“We worked alongside a content creator called Dew Francis and provided him with the resources to co-create a channel called ‘The Backstage Bunch.’ We invested and after six months, we have made it all back, and it’s now driving healthy revenue and profits to us,” says Lim.

Lim attributes these channels’ growth to users consuming more online content and to brands looking for fresh advertising avenues.

“When the pandemic was happening, I think people looked at influencers as possibly a cheaper, alternative format of marketing. Also, they were hoping that influencers would turn to performance marketing,” shares Lim. A brand, for example, might pay for an ad only when a sale has been made.

“For us, our performance marketing model came in the format of livestreaming commerce,” she says.

Gushcloud got into live commerce last year with streams by two of its Singaporean talents: TV presenter and actress Nurul Aini and beauty influencer Eunice Annabel Lim. The pilot episodes of both streams generated more than S$3,500 (around US$2,600) in sales.

Still, these were mostly experiments, and live commerce didn’t add much to the agency’s revenue in 2020. But Lim foresees that it will contribute 50% to 55% of Gushcloud’s business in the next three to five years.

Looking beyond Asia, Gushcloud’s US business grew by 25% to 30% last year, thanks to an expansion of its talent roster. In response to demand from Chinese platforms, the company also brought to China well-known Western talents like supermodel Naomi Campbell.

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