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Influencers Are Making How Much Money?

Whether you’re influencing or getting influenced, there’s no avoiding the phenomenon of influencer marketing.

Welcome back to another special edition newsletter. Today’s read is all about one of the most mysterious and misunderstood careers — influencers. With more content creators pursuing their personal brands full-time, we unpack what life is like behind the social media screens of those at the center of what is now a booming subset of the greater marketing industry.

— Raghu & Rosh

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Behind the Scenes of a Career as an Influencer

Whether you’re influencing or getting influenced, there’s no avoiding the phenomenon of influencer marketing. The industry, which is valued at $20B+, is all but essential to the growth of brands in today’s greater strategy landscape. While the growing and lucrative full-time profession struggles with its own set of negative connotations, the numbers aren’t lying. Influencers can yield tangible results for businesses, but what’s the value of those results? How much is the average influencer making, and is that too little or too much?

FAQ

What is an influencer?
In marketing, a person with the ability to influence potential buyers of a product or service by promoting or recommending the item(s) on social media.

How do they make money?
The bulk of an influencer’s income will likely come from brand partnerships and sponsored posts. They can also get paid for affiliate marketing, official network monetization programs, merchandising, etc. The common factor is being able to capitalize on your own digital likeness.

How do brand deals work?
Either a brand will reach out to an influencer they are interested in having promote their product or service, or an influencer will directly reach out to a brand whom they are interested in working with. Regardless of who pursues the partnership, the terms and conditions of it will vary on the brand deals.

A standard contract between an influencer and a brand will clarify the deliverables, often social media assets like a static post or reel. The brand may include guidelines for the content that the influencer will produce, a timeline for production and posting, distribution rights, and in some cases, clauses for confidentiality or exclusivity.

What the Influencer Could Get

  • Money

  • Free product + service

  • Potential exposure from the brand affiliation

What the Brand Could Get

  • Deliverables (Posts, Content, etc.)

  • Access to the influencer’s audience

  • Sales

In most cases, a brand gets assets and exposure, and in exchange, the influencer is compensated. But there is where it gets tricky. Because… 

What are influencers worth?
Before we attempt to answer such a broad question, we need to understand some of the finer details and terms. For the sake of this newsletter, we’ll break down an influencer’s value based on a few key performing indicators or social media data that can quantify their value as a pr/marketing tool.

Glossary

Followers: The number of followers or subscribers an influencer has on any given social media platform. — This isn’t really as big a factor as it seems though. Anyone can get a bunch of followers, but brands are only incentivized to reward influencers whose followers would be interested consumers. 

Reach: The number of people who see an influencer’s content.

Engagement: An umbrella term for actions that reflect and measure how much an influencer’s audience interacts with their content. This includes likes, comments, shares, etc.

This is “an influencer’s value” based on industry standards, but industry standards are not always respected…

North Carolina based influencer Mira Patel is no stranger to working with huge beauty brands like Sephora, Colourpop, Huda Beauty, etc. but she says that hasn’t deterred smaller brands from feeling entitled to her time and efforts without fair compensation.

“Brands will want to send me 4-5 outfits and ask, ‘Can you give me 20 pictures, 5 reels, and 10 stories per outfit’ and I’m like…”

They wouldn’t pay her. If Mira was a new mirco-influencer on the scene who could gain value from exposure, this story would read differently. But with 148K Instagram followers and a proven success record of using her influence to yield real brand sales, this partnership would have put her at a financial loss. Exposure doesn’t pay rent.

“I realized not everyone is your friend... People will sadly try to use you, and take advantage of your art, and take advantage of your time… and take everything that they can and then just be like, ‘Oh so sorry! We’ve moved on… we’ve found someone else…’ or you just never hear from them again.”

Mira Patel

Behind the Scenes
Most influencers are one-person shows, playing lawyers as they oversee their own partnerships and contracts, playing producer and editor as they create the content, playing marketer as they manage their social platforms, playing accountant as they attempt to make a living, etc.

Sachin Kumar says 40% of his time is spent on the more administrative/business side of the hustle than the actual content creation, which to him is the fun part.

“It gets hard to juggle all of the different buckets. Almost half the time is spent talking to brands, doing data analyses on my last 10 posts, etc.”

Whether you love them or hate them, influencers are doing the job. Brands are seeing massive growth as they replace their dated pr strategies to meet the demands of the new social and digital era. Knowing the value they bring, influencers can charge big bucks, but brands aren’t always ready to pay it. As the industry landscape develops, influencers have the upper hand in determining what fair compensation for their services looks like, but they must be willing to lose that partnership if the brand doesn’t want to play.

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Written and Edited by Raghu Alla and Roshni Lalchandani

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