This year, Snap finally caught user-generated content fever: In 2021, the company has paid out more than $250 million to more than 12,000 creators through its Snapchat Spotlight programs.

Of course, Snap’s total payout is tiny compared with YouTube, the 800-pound gorilla in the digital creator economy: According to YouTube, over the three-year period from 2018-20, it paid more than $30 billion to creators, artists and media companies.

And Snap actually dialed back its payouts for Spotlight. When it first launched the TikTok-style video feature in November 2020, the company said it would shell out upwards of $1 million per day in total among Spotlight contributors with top-performing videos. If it had kept up that pace, Snap would have paid, well, $365 million or more to creators in 2021. According to Snap CEO Evan Spiegel, the company reduced overall Spotlight payments to discourage people from creating viral, one-off copycat videos.

Snap has yet to prove it can turn Spotlight into a meaningful business. But the company’s investment in the platform shows it is committed to help creators of all kinds meaningfully grow their audiences and build a business, said Sam Corrao Clanon, director of content who leads the Snapchat Spotlight team.

“Content and short-form video is a very competitive space right now,” he said. “For us, the challenge has been, how do we make something distinct and complementary in value.”

Compared with rivals — TikTok, of course, as well as Instagram Reels and YouTube Shorts — Snap is “trying to occupy a more casual space” with Snapchat Spotlight, according to Corrao Clanon, “to build an audience and a voice, and also an outlet to capture spontaneous moments.”

Corrao Clanon joined Snap earlier this year from TikTok, where he was head of content strategy and insights. “We wanted to build a personality and identity for Spotlight,” he said about coming to Snap.

When Snap launched with the promise of paying $1 million per day to Spotlight creators, one of the goals was to jumpstart the UGC section: “We had an empty feed to populate,” said Corrao Clanon. By changing the payout model, “We’ve seen a shift from people posting to Spotlight in search of a hit to people who are establishing an identity and building their business on Snapchat,” he said.

Today, according to the company, Spotlight creators post three times as often to the section than they were when it launched a year ago. In addition, more than 65% of Spotlight submissions use one of Snapchat’s creative tools or one of its augmented reality Lenses.

The investment in attracting creators comes before Snap has started to directly monetize Spotlight content. For now, it’s testing out interstitial ads in the section while still “maintaining the experience,” Corrao Clanon said.

As part of the UGC push, Snap recently launched Spotlight Challenges for Snapchatters in the U.S. that offers users the chance to win cash prizes ($25,000 or more) for creating top-performing Spotlight Snaps using specific lenses, sounds or topics. It’s now running 3-5 challenges per week.

Last week, Snap paid Kim Kardashian and Kris Jenner (left) to launch the #KindnessChallenge on Spotlight, soliciting videos from users showing how they spread joy by surprising a loved one. The creator of top Snap in the challenge received $50,000, with $30,000 and $20,000 for the next two most popular posts.

Snapchat creators also can earn money through digital Gifting, which lets users buy Story Replies for their favorite Snapchat influencers, and the Creator Marketplace is set up to let creators ink branded-content deals with marketers.

Snap also has turned to top Spotlight creators to develop shows for syndication on Snapchat Discover, alongside Snap originals and shows from the likes of ESPN’s “SportsCenter” and BuzzFeed. The company has greenlit Discover shows from 25 Spotlight creators, giving them a new format and distribution channel, higher production values and a share of ad revenue.

Three top-performing Spotlight creators who are producing Discover shows are Mia Finney (above left), a recent USC grad who posts comedy skits with her dad, Ernest (aka Ernie Fin); and Nicky and Pierre (above right), a gay couple in L.A. who share funny videos revolving around their relationship. “They’re emblematic of the kinds of content that we’ve seen work well on Spotlight,” said Corrao Clanon.

Finney said she’s been using Snapchat since 2012 (when she was in middle school) and began posting videos featuring her dad to Spotlight when it launched. “Snapchat has evolved in the past two years in such a fun way,” she said. “It used to be for communication; now it’s a hub for making revenue.” Finney estimated that Snapchat payments represent 30%-40% of the income she’s made this year.

“You can hit a higher reach on TikTok,” Finney said. “But if you want a more of a community-engaged base, Snapchat lets you build a closer relationship with your followers. You can show them your daily life beyond videos on TikTok.”

Nicky and Pierre (Nick Champa and Pierre Crespeau) first attracted an audience on other platforms, including Instagram, YouTube, TikTok and OnlyFans.

When they heard about Snapchat’s $1 million-per-day Spotlight payout program, they decided to give it a try. “It’s very in line with what we were doing on other platforms,” Champa said. The money they’ve earned from Snapchat Spotlight “helped us buy our first house,” he added.

Their Snapchat Discover show is being produced by Wheelhouse Entertainment, whose partners include Jimmy Kimmel. “What we love about Snapchat is, it’s a very organic platform. It’s a really safe space to be yourself,” Champa said. “We found something that worked and we ran with it.” Nicky and Pierre now each have nearly 200,000 followers on Snapchat.

Crespeau said that the couple’s strategy is to “show different facets of our relationship on different platforms. On Snapchat what’s working is very fun: We’re sharing the love… and making a fun dance or watching a sunset together.”

Doing the math, the per-creator Spotlight payout from Snap in 2021 comes to about $20,000 on average. “That’s meaningful,” said Corrao Clanon, adding that several hundred creators have earned six figures or more under the program. “We want to make sure the money we are distributing is having a positive impact.”

While there’s a cohort of users motivated by monetization, Corrao Clanon pointed out that Spotlight presents non-monetary appeal as well. “For the long tail of creators there are other motivations that are relevant: Social validation, showing off to friends — that matters to people,” he said.

As it has bulked up its UGC play, Snap has maintained processes designed to reduce the risk of spreading misinformation, hate speech or other potentially harmful content. Snapchat profiles are private by default and all content shared publicly is first reviewed automatically by artificial-intelligence algorithms before gaining any distribution. All content is then human-reviewed and moderated before it can be viewed by more than 25 people.

“In everything we do, we want to maintain Snap’s core identity as the place for authentic interaction with your friends,” Corrao Clanon said. The company wants to avoid “context collapse,” in which your social feed starts blending posts from close friends with material from celebrities and influencers you don’t know personally.

As for what’s next, Corrao Clanon declined to comment on what Snap expects to spend on Snapchat Spotlight next year. One area of focus will be the app’s ongoing work to make users’ video feeds more personalized. “It’s a perpetual project to make the feed more timely and relevant,” he said.

Snap also is delivering an expanded suite of creative tools for creators, including Story Studio, the company’s new standalone mobile app for making and editing professional content. An early version of Story Studio is now available to download from the iOS store in the U.S., Canada and the U.K.

Pictured above: Mia Finney (@wheres_mia); Nicky (@itsnickychampa) and Pierre (@iampierreboo)