As recently as five years ago, many of us had never heard of someone being described as an ‘influencer’. Now, influencers are integral to many brands’ marketing strategies, and it looks as if they will only become more essential to the way businesses reach their core audience in the coming years. So, what is ‘influencer marketing?’
Using influential spokespeople to promote a brand or product has been a popular marketing tactic for centuries – luxury chinaware producers Josiah Wedgwood and Sons leveraged endorsements from members of the royal family to demonstrate that their products were fit for a king as early as the 1760s. Fast forward to the present day, and influencers no longer need to be celebrities – they can be anyone. In fact, non-celebrity influencers can often have the edge, as a brand’s key audience identify with ‘real’ people more strongly, and research determines that the higher your follower numbers, the lower your engagement rate. It is also a hugely useful tool in overcoming the rising use of ad blockers – around 1 in 5 internet users use ad blockers, and when you break that down to millennials specifically it increases to 25%. Influencer marketing is a great way to bypass this barrier to reaching a target market, and it means you are providing your audience with content they actually want to see.
In this guide, we will take you through some of the key facts and figures in the world of influencer marketing, which platform leads the pack in terms of influencers, how they are adding value to brands, and providing some insight into the direction in which it is heading. The thing that makes these individuals influential is simple – their social media following. Influencers carefully cultivate their personal brand and output, which makes them very appealing to brands that align with an influencer’s particular narrative, as they have a much better chance of reaching their key demographic than they do using more traditional marketing techniques.
Using influencer marketing has its challenges as well as its benefits. It isn’t usually a tool to use in order to generate a quick boost in sales, rather it’s a long-term approach to building trust and loyalty, growing awareness of your offering and affirming your brand’s identity through individuals that mirror your values. While this is a significant factor in changing or managing the way your key audience views your brand, it can be difficult to measure the success of an influencer marketing campaign, although a number of useful tools and apps are coming to market that make it easier to gauge ROI.
We will be looking at influencer marketing as a global growing industry, as well as breaking it down by exploring key platforms, individual campaigns and most influential people, as well as looking at the effectiveness of the practice.
- Influencer Marketing Spend
- Influencer Marketing by Platform
- Influencer Marketing Metrics
Influencer Marketing Spend Statistics
As mentioned earlier in this guide, the nature of influencer marketing can make it difficult to determine definitive figures, and this is true of overall influencer marketing spend. The reason this can prove challenging is, in part, due to the fact that gifting products and samples remains a significant part of how influencers are compensated for their work. Research carried out by influencer marketing agency Mediakix estimates the total spend on influencer marketing globally will be between 3 and 6 billion dollars this year, and forecasts that this will rise to between 5 and 10 billion dollars by 2020. These wide ranges are indicative of how complex it is to calibrate an exact figure, but it gives us some idea of how large the market is and how it is predicted to grow.
Influencer Marketing Global Spend ($ Billions)
In terms of the platform on which most of that influencer marketing budget is spent, there is a clear frontrunner globally – Instagram. The image and video-based platform lends itself naturally to influencer marketing, and crossing the 1 billion mark for active users this year was the cherry on top of the sundae. In almost every country, Instagram’s importance in the influencer market continues to grow, although there are exceptions; for example, China, where many traditional social media platforms are not permitted. China’s most popular platforms are the approved sites Weibo and WeChat. Despite certain internet restrictions, Asia as a whole is a thriving market for influencer marketing – East and South East Asia are home to four times as many active social media users as North America. That said, the US still leads the way, particularly on Instagram. In 2017, 49% of sponsored Instagram posts originated from the United States, with the UK coming in a very distant second with 9%. Research from Goldmedia predicts influence marketing across Germany, Austria And Switzerland will grow 20% by 2020, reaching one billion euros.
Although Facebook leads the pack on monthly active users, its star appears to be waning on the influencer marketing front. Despite Facebook coming out on top in some research looking at which platform has the biggest influence on purchasing decisions, a Hashoff survey of 300 respondents found that 79.7% view Instagram as their number one platform, and this percentage is expected to climb to 87.1% by 2019, while just 2.5% of those surveyed view Facebook as their number one platform. The majority of respondents consider YouTube to be the second most important platform.
Research carried out by Rakuten Marketing shows that brands are spending around 6% of marketing budgets on influencer programmes, which when you look at the total annual marketing budget of top-level brands is a significant amount of money, and it is set to climb even higher as we go into 2019. As well as campaign effectiveness, influencers raising prices or opting for monetary compensation as opposed to product compensation are likely to be contributing factors to the expected budget increases for influencer services; the Rakuten Marketing findings show 19% of marketers saw influencers increase their rates by 30%-50% since 2016.
Influencer Marketing Budget Changes in 2018 (%)
The amount brands are spending on campaigns varies substantially depending on the size of the brand, the kind of influencers they are collaborating with, and the vertical market they operate in, among other factors. US-based research from RhythmOne puts the average brands spent on influencer marketing campaigns in 2017 at £51,891,98 – this is up by 38.6% on 2016’s full-year average. Looking at a broad range of forecasts we can expect that average to increase when we look at final figures for this year, and is likely to continue to grow as we move into 2019.
Some celebrity influencers rake in almost unbelievable amounts – the likes of singer Selena Gomez and reality star Kylie Jenner, who boast 144m and 120m followers respectively, can earn in excess of half a million dollars for a single post on Instagram. Influencers with more modest followings comparatively, say 50,000 to 100,000, can earn between $500 and $1000 per post. If you are lucky enough to have 500,000 or more Instagram users following you, you could be seeing more than $3000 for a sponsored post. On YouTube, influencers can make even more cash for posting video content for brands; on average, a brand will pay around $2,000 per 100,000 subscribers. If more than half a million people subscribe to a channel, that person could potentially make upwards of $5000 for a video.
According to an April 2017 report into Influencer Rate and Engagement carried out by influencer.co, the vertical market with the highest sponsored post rate was travel, with an average rate of $220, followed by entertainment, home and lifestyle, health and fitness, and fashion. Business had the lowest average rate of $134.
Average Sponsor Post Rate by Influencer Vertical ($)
Influencer Marketing Statistics by Platform
Instagram – Social media management firm Sprout Social says 7 out of 10 hashtags on Instagram are now branded, demonstrating how crucial Instagram has become to brand marketing. It’s also the primary platform for social media influencers, by a mile – research by eMarketer shows that 78% of influencers globally prefer Instagram, while just 4% prefer YouTube, and 2% prefer Facebook.
YouTube – Research from Think With Google states that 6 in 10 YouTube subscribers would follow advice on what to buy from their favourite content creator over their favourite TV or movie personality. YouTube is arguably the channel of choice for Gen Z; and Google research also determined that when we look specifically at teenagers the stat is even higher – 70% of teens are more influenced by YouTubers than celebrities.
Facebook – With Facebook still reigning as the largest social media platform, it doesn’t seem ready to be outdone by Instagram on the influencer marketing front (despite, obviously, owning Instagram). Facebook has recently launched its ‘Brand Collabs Manager’ search engine. The tool will serve as a connector between marketers and influencers, so brands can easily reach out to content creators that align with their message. This move is a clear indicator that Facebook believes influencer marketing is here to stay, and will only grow in importance in the marketing and advertising industries.
Facebook has some impressive clout – 78% of consumers in the US have discovered retail products to buy on Facebook, e-commerce click through rates have tripled in the last two years, and ad impressions and price per ad are both on the up. As its new collaboration feature launches it will be interesting to determine if marketers shift focus at all, and if influencers start to look beyond their ‘insta-fame’ to increase their earning potential and expand their fanbase.
Twitter – On the whole, Twitter is not considered as essential to influencer marketing campaigns as other platforms. This could be due to a myriad of factors; it doesn’t have the photo-led visual appeal that Instagram offers, or the video-led appeal of YouTube, and doesn’t have the huge active user figures that Facebook has. It also isn’t as important to the consumer purchasing journey – according to a survey from shopper-focused influencer marketing agency Collective Bias, just 2% of respondents checked Twitter first when researching products, and less than 2% surveyed said Twitter had the most influence on their in-store purchasing decisions.
Influencer Marketing Metrics
Measuring ROI is complicated when it comes to influencer marketing, and because of this brands’ campaign goals often shift accordingly. To digital marketers, it can be a bit of a learning curve when you’re used to having the ability to measure every aspect of a campaign in granular detail. Recent research found that 38% of marketers were unable to determine if or how influencer marketing impacted sales, while 86% didn’t know what influencers based their fees on.
It can be argued that a boost in sales isn’t at the heart of this type of marketing. A Linqia study shows that the main measure of success in influencer campaigns is engagement with 90% reporting this as the leading measure of success, followed by clicks, then impressions, then conversions before product sales enter into the equation.
This is where influencers earn their keep, as they largely have higher levels of engagement than content produced by the brands themselves. A recent report gives an average influencer engagement rate across industry verticals of 5.7%, while the average engagement rate for brands on Instagram has hovered around the 2-3% mark in the past year.
However, a metric that is used to quantify influencer marketing success is earned media value (EMV), which is made up of all the social media activity that can be measured; likes, reposts, shares, reviews, mentions – all the actions that demonstrate how much a brand is being engaged with and talked about following an influencer campaign. The average EMV for US-based influencer marketing in 2016 and 2017 was 12.21 dollars of value for every dollar spent [Statista]. Research by InfluencerDB shows that the top 20 brands created $659,882,860 in EMV on Instagram alone, just in the first five months of this year.
As Instagram’s features evolve and the influencer market becomes more sophisticated, there will inevitably be developments in the way ROI is measured. For example, this year Instagram introduced Shoppable Posts, allowing users to simply click on a post and be directed to where the product or products can be purchased. This does need to be carried out through a business Instagram account that is linked to an active shop on Facebook, but brands themselves can repost the images from influencers’ accounts and link to the shops, which in turn will allow brands to monitor the impact of the influencers they work with in terms of driving sales. This is a fairly new feature so there are no reliable statistics so far, but it is certainly a metric to keep an eye on. Some sources are also reporting a rumoured IG Shopping app, that will be a separate download from the main Instagram app, that will allow users to shop directly from retailers they follow. This is not official, but if true it cements Instagram’s commitment to e-commerce, and while similar features on other platforms such as Facebook’s Marketplace, Instagram’s wealth of influencers and online boutiques could mean it is better placed for success in this market.
As touched on elsewhere in this guide, the accounts with the most followers aren’t necessarily the most influential. Celebrities tend to attract the highest numbers, and a celebrity isn’t necessarily synonymous with those followers’ interest in any particular brand or vertical market, compared to, say, a non-celebrity fitness influencer endorsing a whey protein product.
Just like conjuring a definitive figure in terms of influencer marketing spend, or calculating exact ROI for influencer campaign, determining ‘top’ influencers is also a less than simple process. Just how do we decide who wields the most influence? Is it purely down to follower numbers? Is it those who have proven they drive product sales? Or do we need to look purely at levels of engagement? The fact is, neither of these indicators will provide a categorical list of top influencers, but we can look at a combination of these factors and take an educated estimate at who are the leading influencers by platform.
Top Instagram Influencers
Huda Kattan – @hudabeauty Statistics
Make-up artist and entrepreneur Huda boasts 28.9m followers on Instagram, and was named in Forbes as one of the ten most powerful influencers in the world of beauty. She also tops the 2018 Influencer Instagram Rich List from HopperHQ (not including celebrities), which places her cost per post at $33,000.
Top Non-Celebrity Influencers on Instagram in 2018
Source: Influencer Marketing Hub
Top YouTube Influencers
Felix Kjellberg, known on YouTube as ‘PewDiePie’, has 70.3m subscribers at the time of writing, and is the most followed YouTuber in the history of the site. His reign has not been without controversy – he has been widely criticised on a number of occasions for inappropriate behaviour, including racist and anti-Semitic remarks. Last year, Disney severed ties with the Swedish vlogger amid one such furore, but nothing seems to have halted his rise to the top. However, while it can be argued that he tops the list of most influential YouTubers, his channel is only number 7 if we go on views alone, according to Social Blade. Although the below chart includes traditional celebrity influencers, PewDiePie is still significantly ahead of the closest celebrity, singer Justin Bieber, in terms of subscribers.
Top Non-Celebrity Influencers on YouTube in 2018
Source: Statista (figures accurate as of September 2018)
Going into 2019, brands are increasing their budgets for influencer marketing, and influencers themselves are increasing their rates. Proof, if it was needed, that influencer marketing is set to experience further growth as it becomes a more mainstream form of marketing – even the naysayers that have in the past dismissed it as a waste of money compared to more traditional techniques would have to admit that influencer marketing has come into its own, particularly in 2018. Its rise could also serve as a catalyst for the already declining obsession with measurability, e.g. clicks, conversions, impressions, etc. Influencer marketing has led brands to give more weight to the ‘slow burn’ of brand awareness and how key audiences view the brand – building a community of brand advocates is the marketing of the future.
Instagram shows no signs of giving up its influencer marketing crown any time soon – it is likely to see significant growth in emerging markets in 2019, such as the DACH region. In contrast, 2019 has not been a great year for social media giant Facebook, and the platform’s woes are likely to continue. However, if Facebook’s new Brands Collabs Manager takes off, it could be a substantial game-changer for influencer marketing, and is definitely something to keep an eye on in 2019. Another interesting area to watch will be how influencer marketing on YouTube fares over the coming years, as the younger demographic become more influential in terms of purchasing decisions.
In terms of transparency, the market is still finding its feet. In the last year or two platforms have cracked down on influencers that have failed to label paid-for content appropriately, but with recent backlashes such as influencers faking paid posts to exaggerate demand from big brands to collaborate with them, there are still likely to be some trust wrinkles to iron out going forward.