Instagram is 10. That’s a decade of outfits of the day, brunch and of course, #SponCon. Amelia Cullen examines the value of the influencer industry and figures out who’s making cold hard cash when you buy toothpaste…
October marks ten years of Instagram.
That’s one decade – or 3,650 days, 87,600 hours, 5,259,600 minutes. For Instagram it marks 50 billion photos posted and counting. What began as a photo sharing app to be used and loved by friends has evolved into something so much bigger. It’s a network, a marketing tool, a platform, a soap box, a publisher and for many; a revenue stream.
In 2020 influencers and consumer culture is embedded within the app. Whatever your opinion on influencers, their economic productivity is undeniable with the global influencer industry set to be worth $15 Billion by 2022 according to Business Insider. But with so many seeking the swipe-up life, one has to wonder whether promoting potatoes is actually paying the bills or whether the #SponCon career comes with a secret feet pic side hustle.[restrict]
Influencer is an umbrella term for anyone leveraging their social following for financial gain. That leveraging means they make a profit by selling access to their audiences – your attention is their product.
This practice of audience commodification is not new, with newspapers and magazines packaging their audiences to attract advertisers. And, we all have seen the effects of social media platform’s ability to exploit users’ data to create creepily efficient advertising. Internet 101 – if you’re not paying you’re the product.
As social media encouraged users to regulate their online behaviour via business ideals, those who employed successful strategies of self-presentation attracted investors in the form of followers, while some influencers grew large online followings seemingly overnight due to previously held celebrity status, 5-minutes of reality tv fame or sudden tragedy. Often those with profitable followings built these over time adopting the suggestion of Tom Peters 1997 article and developing ‘a brand called you’.
Influencers immersed themselves in the capitalist endeavour of presenting themselves as a saleable commodity for you to buy into. They market all aspects of their lives by sharing every filtered detail: morning routines to smear tests and everything in between. Promoting neoliberal ideals of an autonomous self in need of constant improvement, influencers’ own practices of self-investment encouraged followers to seek fulfilment through economic activity. Get healthy with these vitamins, better sleep with this spray, the answer to all your problems at the end of a link.
Adopting the concept from magazine publishers, influencers create media kits to present their audiences to advertisers. These glossy sales pitches include demographic characteristics – data gleaned from Instagram tools alongside qualitative data from follower interactions including Q&As, direct messages, polls and question boxes. Just as traditional advertisers conducted market research, influencers attain vast insights into the lifestyle, cultural interests, values and practices of their followers.
As brands began to see the economic potential of this new social media audience, they took action. In the beginning brands would send free products to influencers in hopes of being featured, prompting influencers to share videos dedicated to unboxing the numerous free items they had been sent. As influencers realised the potential value of their audience they began to request financial compensation. Transparency around financial incentives was minimal.
As the number of active influencers grew, narratives around them changed. Audiences began to question the motives of influencer sharing. The language around brand relationships was ambiguous, with audiences left to question if products had been sent with a pay cheque, received for free or purchased by the influencer. Rumours spread of influencers insinuating products they had paid for had been gifted in order to raise their profile. Others were accused of selling gifted clothes on Depop.
The introduction of the clear ASAI guidelines for influencers and bloggers in 2017, alongside increased demands for quantifiable return on investment (ROI) for brands, changed the landscape of influence.
While celebrity influencers (1m+ followers) are still receiving six figure payouts to push the latest trend of industrial diet culture, (Skinny Pen anyone?) Influencer fatigue has created audiences who are increasingly critical of what influencers market to them. The ASAI received 107 influencer related complaints in 2018.
Amongst those that embrace audience commodification, the exchange value that the audience receives can greatly vary. There is no such thing as a free lunch, and in the case of many influencers there is no such thing as a free workout, yoga class, makeup tutorial or funny video.
In the three years since the ASAI guidelines took effect authenticity is the buzzword for success in the attention economy. When followers see #ad, #af, #spon or #iworkwith it indicates a financial relationship, but the value of such remains largely a mystery.
Sponsored content is one of the most popular methods for monetising audiences. I chatted to @clisare about her views on sponsored content. Clare says that while she does create sponsored content she is careful in only accepting what makes sense to her audience, regularly turning down offers and choosing to diversify her income streams so that she only takes sponsorship for things that she uses and enjoys.
Clare occasionally submits content proposals for brand campaigns on platforms like Glambassador, the Irish Blogger Agency or Activate. On Instagram, nearly all her sponsored content comes from brands approaching her. While on her Youtube channel the revenue split is essentially half and half. Clare highlights that you earn less going through a platform than when a brand approaches you.
Rates for sponsored posts vary between influencers but rogue has seen information from Irish media professionals showcasing a disparity in influencer rates and key performance indicators. Documents also suggest that unlike other digital media sales or traditional advertising sales, there is no standard rate for a cost per mile or cost per thousand impressions.
The evidence seen by rogue shows that one Dublin based influencer with a following exceeding 42,000 received €500 for six Instagram story posts. Another Irish influencer had a somewhat larger audience, and charged €5,000 for the same amount of content creation.
Grace O’Reilly, founder of PSYCLONE, spoke to me about the inequality of influence that exists in the content space of Youtube and TikTok. With brands often offering vastly different rates to different creators for the same content formats.
Instagram influencers who focus on authentic and transparent content that fits within very specific brand parameters, consider their audience and how collaborations appeal to them are meant to see long term financial gain. But how much are they really making?
One method for influencers to see a regular flow of income is with affiliate links. When influencers share products using an affiliate link or code they receive a set amount from any sale made. You need 10,000 followers to access the coveted swipe up feature. But with a multitude of platforms designed to facilitate this process, even influencers with as few as 600 followers can profit recommending pretty much anything – an Emma Mattress (from €21.10), a night at Sheen Falls (from €25.20), Snapfish Photobook (from €6.50) – and the list goes on.
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The more engaged your audience the greater your profits. With a medium sized following of 40,000-60,000 influencers can make up to €1,170 sharing just 20 links a month at an 8% commission rate and a 0.95%% conversion rate. For those around 100,000 followers the predicted pay cheque is around €1,200 while for macro/celeb influencers with followings over 300,000 that figure could be as much as €4,450.
Clare goes directly to brands rather than through a platform. She has direct affiliate links with both Audible and Skillshare where she receives a specific amount per sign-up. Working directly with brands allows influencers to form better relationships with affiliate managers. Influencers often use affiliate links for products they have been gifted or for brands they hope to work with in the future.
Many influencers form long-standing relationships with brands, whereby influencers select products each month with no set arrangement on when or how they will feature on their social media. Therefore falling within ‘gifting’ guidelines. They then share these with followers via affiliate links and make a steady profit from free items.
Having previously worked on the affiliate team for a major British brand, this writer has experience arranging clothes to be sent to influencers often to the value of £1,000 a month, from which they could earn hundreds in affiliated sales.
It is hard to quantify what your attention is worth when there is no standard price, but it is clearly worth something. While those with big followers can see large payouts, there remains a question on how sustainable this is with audiences engaging less with these often dubious products. While those with smaller engaged audiences have long-term earning potential with such variance in rates, can this be enough to cover a mortgage?
Industry trends today suggest brands boost sales by marketing their products to specific audiences and are increasingly likely to engage with micro-influencers who have built loyal communities of followers within a certain niche. Fashion, food, fitness, gardening, pet care, interiors, sustainability – there truly is an influencer for everything.
These influencers identify certain interests and values to form the core of their brand and content strategy. Many hold separate full-time jobs often incorporating these into their influencer brand. Interior designers, chefs, personal trainers, nutritionists and many more are utilising their professional skills in their online personas. Accepting work only with brands whose own values align with their own, they consider the interests of their audience in business decisions.
The shift away from one-size-fits-all approaches to influencer collaborations is reflected in the emergence of influencer marketing agencies. Often connected to ‘sister’ creative agencies they operate in a semi-enclosed system of collaboration.
The required use of specific hashtags and declarations in order to clearly establish content as advertising in conjunction with increased expectations from brands and audiences in regards to influencer content has many distancing themselves from the term.
Discussing the term ‘influencer’, Clare Cullen (@clisare) thinks it does have a negative connotation in Ireland today. She considers herself a content creator who utilises her digital skills to create content that her audience will enjoy and engage with.
Grace O’Reilly works with emerging Gen Z talent and describes her clients ‘creators with influence’ as opposed to influencers who, to her, are social celebrities, often gaining a profile from reality television. Grace recognises that certain brands continue to put value on the attention attached to these type of influencers. She believes they have yet to appreciate that audiences are perceptive to the manufacturing of such content.
The difference between content creators and traditional conceptions of influencers is tied to the content they produce. Creators generate content that builds emotional connections, entertains audiences and feels authentic. While also involving some form of technical or creative skills. The modern influencer is a digital creator and as with Clare, utilises the skills they glean on Instagram to build a more robust career.
When we celebrate birthdays we often look back on the best times – the happiest memories and the joy we’ve shared. So as we wish #HB to our old pal Insta, perhaps now is the time to question not how much value our attention is bringing to others, but what value are these platforms really giving to us?
Main image via Unsplash[/restrict]