From strength to strength: You’re a billion dollars darling!

The Influencer marketing industry hits the $1 billion mark

Influencer Marketing is a $1 billion industry and predicted to grow to a $5-10 billion market by 2020

According to a new study by Mediakix, advertising spend in Influencer Marketing is currently estimated at over $1 billion per year with projections that this will continue to progress significantly in the coming years.

Brands are increasingly seeing the value of Influencer Marketing and leaving aside more marketing budget to invest in the space.

With the decline in potency of traditional methods of advertising, for example TV and magazine, and the growth of social media, Influencer Marketing is one of the fastest growing forms of advertising. Instagram is paving the way in this space as one of the fastest growing segments of Influencer Marketing.

The recent international brand boycott of Google and YouTube programmatic advertising has opened up new budget opportunities in the Influencer Marketing space. There is an increased need to accurately engage relevant audiences and partner brands with like-minded individuals. Influencers who are on-brand provide a solution to avoid running the risk of being placed side by side with content that is not complementary to the brand’s values/ideals. When there is an authentic partnership, the sponsored content will appear naturally in the Influencer’s feed and their audience will engage with their product recommendation.

Image from our recent Vamp x Swarovski SLAKE campaign. Vamp Influencer content featured on the Westfield website 

71% of consumers are more likely to make a purchase based on a social media reference.

Vamp Influencer produced content for a New Balance digital look book, alongside an Influencer Marketing campaign.

Vamp has previously found in social selling campaigns that we have run with brands like Nude by Nature, DEX and New Balance that brands have achieved a higher engagement rate in sponsored posts than their own brand-produced content.

We expect that this is because the Influencer produced content appears more native and organic within the social channels.

Instagram is one of the fastest growing, far-reaching and engaged social media platforms since 2011. 

Now over 600 million Instagrammers strong, the count has accelerated greatly in the past six months with an additional 100 million more users joining the platform.

Instagram also recently “passed 400 million daily actives, with Instagram Stories reaching 150 million daily actives just five months after the launch” (Mark Zuckerberg, CEO Facebook).

It doesn’t show any signs of slowing down.

Within Instagram alone, the projected Influencer Marketing growth is $2 billion by 2019.

Mediakix Instagram Influencer Marketing Methodology 

Mediakix tracked hashtags including #ad, #sponsored, #spon, #sp as per the US FTC regulations and found that in this year there was an increase of 4.8 million users of these hashtags from previous years.

Knowing that worldwide, not all advertisers and Influencers are required to include these FTC hashtags in their sponsored posts, it could be inferred that there are potentially a lot more untracked sponsored posts than this given number of 4.8 million users.

Mediakix argue that from a sample size of 500 recent posts, the hashtags in their count weren’t always associated with sponsored posts, however, as 42% of these posts were associated with accounts with fewer than 1,000 followers.

“It’s unlikely that users managing these accounts are actually being paid for these posts or, if they are being paid, that there would be a significant effect on the size of the Instagram influencer market as a whole.

That leaves about 58% of the sponsored posts from accounts with more than 1,000 followers. Of the 4,792,033 posts recorded over 12 months, that amounts to 2,788,963 sponsored posts.

We then found the average follower size for accounts posting sponsored content was 32,000. Given an average $10 cost per thousand impressions (CPM), we ended up at an estimated $320 per post and an estimated total monthly spend of approximately $90 million. This would put the overall total annual spend at over $1 billion.

With the current annual growth, the market could reach a $130M/month spend by March 2018 and up to a $200M/month spend by March 2019 (nearly $2.4B spent on influencer marketing on Instagram alone).”

On the flip side of this, however, is the fact that the monetary value on Influencers is shifting away from reach, to engagement, to quality of content. The evolution of Influencer to Content Creator has seen

Monique Llewellyn, Global Talent Director, Vamp

“The addition of social media has created a new standard for content consumption. Consumers are expecting new content daily across all mediums resulting in brands looking to collaborate with Content Creators to create unique content specifically and exclusively for their campaigns. They are already working with agencies such as Vamp to produce them.”

Excerpt from The Evolution of Influencer to Content Creator article

Vamp sees more and more brands specifying KPIs of high quality, on-brand content over a specific reach in campaigns with Vamp of recent than ever before.

This is partly because the audience of the Power-middle Influencer tends to be more highly engaged than that of a celebrity or otherwise higher-reaching Influencer. Brands are also seeing the value of Influencer “Content Creator” visuals for time and money conscious marketers looking to keep up with the demand for fresh new content on their social channels and websites.

Definition: Power-Middle/Micro-Influencer

At Vamp the Power-Middle or Micro-Influencer has anywhere between 3-250k followers who frequently engage with their content. Rather than focusing solely on reach or impressions, which are not always the most reliable indicators of the engagement rate, Power-Middle Influencers have a highly engaged, intimate community.

Rather than spending a lump sum on one individual Celebrity Influencer to produce a single piece of content, brands can utilise a collective of Power-Middle/Micro Influencers to produce a variety of visual assets and together hit a desired reach/no. of impressions.

Vamp produced content for recent Uniqlo Knitwear campaign. 


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