User content as a marketing strategy tool: basic structural elements, principles, benefits and risks of use

Abstract

Introduction.The processes of globalization and digitization of all economic activities necessitate the updating of methods and tools for promoting goods and services. According to WhatstheBigData, in 2022, the number of smartphones was 6.42 billion units, and in 2023, this figure increased by 297 million. Experts predict that by 2028, the number of smartphones will reach 7.74 billion. This, in turn, triggers an increase in the number of social media users and simplifies communication with consumers. Furthermore, the emergence of new technologies leads to the transformation of communications among all stakeholders. Artificial intelligence tools enable the creation of content and ideas for promotion, taking into account the emotional tone of the target audience, the value of the product, brand, etc.

The aim of this paper is to systematize the theoretical and practical basis of UGC, determine the volumes and risks of the market.

Methods.The research is based on publicly available information, studies of users’ emotional reactions, and open economic indicators of the user-generated content market.

Results. The effectiveness of existing digital tools depends on several factors: 1) content quality and information noise. Instagram users upload 1,099 pieces of content every second, leading to overload, requiring brands to spend more time retaining the attention of their target audience; 2) level of competition. Clear content creation algorithms, user-friendly online dashboards, and relatively low costs result in high competition levels. According to Statista, the number of active Facebook advertisers reached 10 million companies in 2020; 3) algorithm for ranking organic and commercial content. Social networks constantly update their algorithms, which necessitates continuous content updates considering these algorithm and technology changes. According to various studies, four main methods of promotion on social networks are identified: influencer advertising, content marketing, organic promotion, and targeted advertising. Additionally, marketing experts note that user- generated content (UGC) saw significant growth in 2023. The specificity of UGC lies in its creation by the audience of social networks, messengers, and streaming platforms. Its emergence was somewhat triggered by information noise and inauthentic content. Users began sharing personal impressions about products, services, or companies in general. This content is mostly organic, requiring prior preparation and differing in effectiveness and the inability to fully control or predict results. For example, the effectiveness of targeted advertising can be preliminarily determined in the ad manager, while promotion through influencers is based on the analysis of their profile statistics. According to Scopus, 2023 was the most active year for publications on user-generated content. Researchers published 398 papers on the analyzed topic within the fields of business, economics, management, and social sciences. Ukrainian marketing agencies are incorporating UGC into their advertising strategies. For instance, Genius Space and SendPulse use the tool to promote educational courses. Domestic retail chains such as Eva, Avrora, and Silpo are forming marketing campaigns based on UGC. In 2024, the market value has already been estimated at over $4 billion. In the USA, a full-fledged profession – “UGC Creator” – has emerged, which is also starting to appear in Ukraine. Thus, the topic is relevant among both researchers and entrepreneurs. However, the reasons for its emergence, structure, and risks of use are not structured. he advantages and risks of using user-generated content in marketing campaigns.

Directions for further investigations. Further research is needed to determine the effectiveness of user-generated content compared to other marketing tools based on statistical indicators. Additionally, methods for minimizing existing risks and identifying further modernization of the tool need to be found. In particular, content created by artificial intelligence is already being actively discussed in scientific communities in 2024. For user- generated content, this could pose a significant threat, so it is necessary to determine the place of “artificial content” within marketing promotion in the future.