The Rise Of Creative Industries

The creative Industry comprises a variety of sectors, including Advertising, Architecture, Arts and Crafts, Film Making, Design, Fashion, Publishing, Research and Development, Radio, and Video Games. 

The Industry has a dominant role to play for the working residents of a country as it encompasses every form of talent which can be put to effective use for the development of the nation as a whole. 

History Defines its Nomenclature

Also referred to as the Cultural Industries, the direction for growth and development depends upon a huge degree of the culture followed by the nation. Preserving the traditions and customs of the countries in the form of Museums, monuments, and Libraries is another way forward for Cultural Industry to prove its worth.

The arts have always been considered an embodiment of freedom of human expression, beauty, human creativity, prosperity, and connectedness throughout history. Because of this stimulation of senses, emotions, and thoughts, the Arts can provide communities with a stronger sense of identity, challenge the status quo, and, most importantly, incorporate beauty into an environment.

An interface between economics, culture, creativity, and technology…

As a whole defining concept in the modern world, the creative economy has an abundance of texts, sounds, symbols, and images. The creative industries have their origin in individual creativity, skill, and talent and have a potential for wealth and job creation through the generation and exploitation of intellectual property. Long story short, the creativity and collaboration of the arts and craft can also be woven into the market economy to create work and wealth simultaneously for an efficient and effective economy.

Statistics 

The creative economy is considered one of the most rapidly growing sectors globally, contributing 3% of the global economy and 5% of the total output. The Cultural Sector employs 30 million people worldwide so that their skills and talent can be put to best use. The creative and Cultural Industry generates 2250 billion USD making it a dominant market having potential for growth and investment.

The Golden Age

The Creative Industry has been on a golden move to be a dominant contributor to an efficient and effective economy worldwide.  

In Indonesia, in 2017, the creative economy contributed 71.8 million USD to the country’s GDP, increasing slightly in 2018 to 78.9 million USD. The creative industry in Indonesia has the potential to grow into a vast consumer market.

In the UK, creative industries made a record input to the economy in 2017, contributing £101.5 billion to the country's coffers, and grew at nearly twice the economy's rate since 2010.

In addition, the creative economy generates social and cultural capital for the world. In South Africa, the cultural and creative industries contributed 5.6% to the gross domestic product, with an upward trend in pre-crisis time.

 In Nigeria, the music industry grew at an annual rate of 13.4%. The Nigerian film industry, known as "Nollywood," employs about one million people and, with over 2,000 films produced per year, was ahead of Hollywood.

CREATIVE INDUSTRIES BADLY HIT BY PANDEMIC

It is estimated that an overall 750 billion USD contraction of the gross value added by cultural and creative industries will be experienced globally in 2020, which represents a dramatic setback in the capacity of these industries to be drivers of cultural, economic, and social outputs sustainable development.

“Along with the tourism sector, cultural and creative sectors are most affected by the current crisis, with jobs at risk ranging from 0.8 to 5.5% of employment.”

The venue-based sectors (such as museums, performing arts, live music, festivals, cinema, etc.) are the hardest hit by social distancing measures. The abrupt drop in revenues puts their financial sustainability at risk. It has resulted in reduced wage earnings and lay-offs with repercussions for the value chain of their suppliers, from creative and non-creative sectors alike.

Bright Side

The COVID-19 pandemic has pushed many businesses, including those within the creative industries, to operate rapidly and develop new, more resilient ways of functioning (Eggers, 2020, Ivanov, 2020). For businesses and organizations to survive in times of crisis, the main component of every system should be resilience (Hynes et al., 2020). The recent events of the COVID-19 pandemic have demonstrated that the creative industries adopted new business models to operate during this crisis. 

For example, some museums started to offer online exhibitions, while musicians delivered concerts via online streams or recorded their performances changing the customers’ experience, demand, and consumption. The literature has also demonstrated that most small businesses, freelancers, and self-employed in the creative industries struggle to adapt to new changes and be resilient (UNESCO, 2021, Florida and Seman, 2020).

Recognition of CCIs

2021 has been accounted for as the International Year of Creative Economy for Sustainable Development at the 74th United Nations General Assembly.

The implementation of the Year could not have had a better opportune time. As the year comes to a close, UNCTAD’s Henderson says awareness of the potential of the Creative Industry has been gaining momentum. For the first time when G20 leaders have acknowledged culture and creative industries for their contribution to sustainable development and economic resilience. Cultural heritage has been included for post covid recoveries. 

In 2013, Inter-American Development Bank published one of the first Handbooks to bolster creators, nonprofits, and the navigation of commercial opportunities across the cultural heritage and creative services, eventually known as Orange Economy.

The creative Industry also gained recognition for the vast potential to enable economic growth and cultural development at the 2018 World Conference on Creative Economy. These recognitions make the Creative Sector the best Industry to invest in 2021 with the potential for exponential growth. 

The implementation of the Year could not have had a better opportune time. As the year comes to a close, UNCTAD’s Henderson says awareness of the potential of the Creative Industry has been gaining momentum. For the first time when G20 leaders have acknowledged culture and creative industries for their contribution to sustainable development and economic resilience. Cultural heritage has been included for post covid recoveries. 

In 2013, Inter-American Development Bank published one of the first Handbooks to bolster creators, nonprofits, and the navigation of commercial opportunities across the cultural heritage and creative services, eventually known as Orange Economy.

The creative Industry also gained recognition for the vast potential to enable economic growth and cultural development at the 2018 World Conference on Creative Economy. These recognitions make the Creative Sector the best Industry to invest in 2021 with the potential for exponential growth. 

AN INDIAN PERSPECTIVE

Overview

India, a country possessing a 500-year artisanal legacy, generates approximately an employment of about 40 million people who are working in the creative manufacturing sector, including both part-time and full-time. The global demand for creative manufactured goods worth $US 400 billion annually is expanding in double digits, creating huge opportunities. As of 2016-17, the gross value addition from copyright-relevant industries was 11,769,291,490.10 USD, and at a 0.58% share of total value-added, it was a tenth of the global average.  

Positive Outlook for India

Statisticians have a very positive outlook for creative industries in India to increase and expand to the highest of expertise. Being a very diverse sector, the creative economy has a very strong backbone in cultural traditions and the entertainment sector. The main source which drives the production and consumption of goods and services and helps in the generation of a chain of economic activity is the commercialization and monetization of creative works by the population of India, including artists and professionals. The creative economy feeds other economies, including transport, hotels, tourism, and restaurants. 

DURGA PUJA is an annual festival in West Bengal

In West Bengal, segments that make up the creative economy of the annual Durga Puja are highlighted by the British Council's groundbreaking research. The cultural and arts yearly festival contributed 2.58% of West Bengal’s GDP in the 2019 pre-pandemic. This is why the Durga Puja festival holds utmost importance for the artisans and designers of the state.

Role of Micro, Small, and Medium-sized Enterprises

 In India, Micro, Small, and Mid-size enterprises comprise 88% of the creative industry. The composition of value addition in Indian copyright industries is similar to other countries. These are the ones who are wholly indulged in copyright-relevant activities, including literature, press, dramatic arts, music and films. These referred sectors contribute 45% of the total value added to the creative economy. Independent industries, which include distributing creative works through television and radio, contribute 40% of the creative economies.  

Impact of Covid

• Creative organizations invested in digital marketing, distribution and e-commerce have performed better during the pandemic. With 10% moving to online sales platforms in 2020, this is a significant area of, as yet, untapped growth and need for skill development.
•  Women constitute 52% of the workforce in the creative economy and 59% in the crafts economy. The pandemic has deepened inequality between men and women while access to digital technology remains largely a male preserve.  

• The report demonstrated a consistent impact on the creative economy and its ability to recover faced by 90% of the sector.

• MSMEs constitute 88% of the creative economy, while the freelance and gig workforce has been the most affected. A hand-to-mouth existence has been faced by individual professionals and artisans surviving on food parcels and state government micro-grants.
• Lack of access to WIFI and digital skills has left Rural India the most vulnerable. There has been a digital divide between metros and rural communities.
• India has an imminent need for institutional support to sustain the livelihoods of the artists and arts organizations that nurture it.

"Prioritize concerted emergency action now for the creative economy."  

Emergency Action

Collaborative emergency action by governments and companies' contributions through loans and grants is necessary to help the creative industry workforce and artists.

Digital Skill Programmes

Digital skills programs would help resolve some long-term systemic issues for upskilling artisans and companies to adapt to new ways of producing, distributing, and selling.

National Culture Fund Use

The National Culture Fund's use to provide grants to established urban and rural companies for artists and artisans would help institutionalize creative sector funding. 

The Global Arts Market is predicted to expand from 36.48 billion USD in 2020 to 39.26 billion dollars USD in 2021 at a compound annual growth rate (CAGR) of 7.99%. Global online sales increased significantly in 2020 over the previous, rising from 4.8 billion USD to nearly 7.9 billion USD. This rising trend also continued at 6.8 billion euros in 2021. 

The fashion industry has been an integral part of the creative industry. The global apparel market is projected to grow from 1.5 trillion US dollars in 2020 to about 2.25 trillion dollars by 2025.

Key Asian Players

Vietnam

• Revenue in the Fashion segment is projected to reach US$2,412m in 2022.
• Revenue is expected to show an annual growth rate (CAGR 2022-2025) of 15.34%, resulting in a projected market volume of US$3,701 million by 2025.
• With a projected market volume of US$ 312,206 million in 2022, most revenue is generated in China.
• In the Fashion segment, the number of users is expected to amount to 43.3 million users by 2025.
• User penetration will be 36.2% in 2022 and is expected to hit 42.8% by 2025.
• The average revenue per user (ARPU) is expected to amount to US$67.34.

China

• Revenue in the Fashion segment is projected to reach

         US$ 312,206 million in 2022.

• Revenue is expected to show an annual growth rate (CAGR 2022-2025) of 5.07%, resulting in a projected market volume of US$ 362,091 million by 2025.
• With a projected market volume of US$ 312,206 million in 2022, most revenue is generated in China.
• In the Fashion segment, the number of users is expected to amount to 819.7 million users by 2025.
• User penetration will be 44.8% in 2022 and is expected to hit 55.9% by 2025.
• The average revenue per user (ARPU) is expected to amount to US$479.03.

Indonesia

• Revenue in the Fashion segment is projected to reach US$9,300 million in 2022.
• Revenue is expected to show an annual growth rate (CAGR 2022-2025) of 4.21%, resulting in a projected market volume of US$10,526 million by 2025.
• With a projected market volume of US$ 312,206 million in 2022, most revenue is generated in China.
• In the Fashion segment, the number of users is expected to amount to 117.0 million users by 2025.
• User penetration will be 31.6% in 2022 and is expected to hit 40.8% by 2025.
• The average revenue per user (ARPU) is expected to amount to US$105.60.

Thailand

• Revenue in the Fashion segment is projected to reach US$1,790 million in 2022.
• Revenue is expected to show an annual growth rate (CAGR 2022-2025) of 20.65%, resulting in a projected market volume of US$3,144 million by 2025.
• With a projected market volume of US$ 312,206 million in 2022, most revenue is generated in China.
• In the Fashion segment, the number of users is expected to amount to 25.6 million users by 2025.
• User penetration will be 28.5% in 2022 and is expected to hit 36.4% by 2025.
• The average revenue per user (ARPU) is expected to amount to US$89.60.

India

• Revenue in the Fashion segment is projected to reach US$19,689 million in 2022.
• Revenue is expected to show an annual growth rate (CAGR 2022-2025) of 18.92%, resulting in a projected market volume of US$33,109 million by 2025.
• With a projected market volume of US $312,206 million in 2022, most revenue is generated in China.
• In the Fashion segment, the number of users is expected to amount to 446.2 million users by 2025.
• User penetration will be 22.8% in 2022 and is expected to hit 30.9% by 2025.
• The average revenue per user (ARPU) is expected to amount to US$ 61.4 million.