Despite current economic uncertainty, new evidence shows that Instagram is the leading social platform in influencer spending, ahead of apps such as TikTok and YouTube.
According to a new report from Insider Intelligence, marketers spend three times the amount on influencer marketing on the platform compared to TikTok, racking up a total spend of $2.23 billion this year. This is in contrast to figures such as the $774.8 million spent on TikTok and $948 million on YouTube. Nevertheless, the report indicates influencer spending on TikTok is growing at a faster rate than any other platform, capitalising on general growth in the industry; spending in the US is set to nearly double its 2019 level by the end of 2023.
Why are marketers spending more on Instagram than on other platforms?
The platform is leading the way due to the range of formats that its creators can use to create content, including the pursuit of Reels, which Instagram is heavily promoting in a bid to imitate TikTok. However, the platform was recently under fire for this, with a petition titled ‘Make Instagram Instagram Again’ gathering hundreds of thousands of signatures, demanding the changes be reversed.
Furthermore, as Instagram hosts a majority of mid-tier influencers, costs on the platform can be high with mid-tier influencers drawing in the highest spend per follower count, according to the Insider Intelligence report. In order for Instagram to retain its lead in the influencer marketing space, the goal is to attract and invest in small content creators, such as nano or micro-influencers that can deliver quality content at lower costs.
Why is influencing a popular career?
In a 2019 poll, it was found that children had more desire to be a YouTuber than an astronaut, with youngsters aspiring to make an income from their social media content as a full-time career. Influencer marketing has only risen over the years as more individuals strive towards a career in influencing, with many creators relying on brand partnerships as their main source of creator income.
According to Morning Consult, 11% of Gen Z and 12% of Millennials consider themselves to be influencers, with 86% willing to post sponsored content for money. As there is an increase in the consideration of smaller content creators, start-up influencers are taking advantage of the fact that they can translate their content into cash.
Why is spending on influencers popular with marketers?
Trustworthy relationships can be built between creator and audience, with marketers relying on word of mouth influencers have the ability to generate in particular niches. Influencer marketing is essentially a way to distribute advertisements creatively and with individuality at its core.
It is also said that more people trust influencers as spokespeople than celebrities in terms of product recommendations. According to the Morning Consult report, 72% of Gen Z and Millennials follow influencers, and 52% of them express their trust in them which has modified the ways in which marketers approach marketing methods. The report also states that 50% of audiences use social media to decide on which products to buy and 53% purchase a product that was used by someone that they follow.
Marketers approach nano and micro-influencers in particular due to the high engagement rates that they can produce on sponsored content. The investment in influencers across all tiers and platforms is already utilised by 74.5% of U.S. marketing agencies this year as expressed by Insider Intelligence, and will undoubtedly rise in the future.
During the forthcoming period of economic uncertainty when consumers tighten their purse strings, influencer marketing will be more important than ever for retaining market share and converting a reduced pool of active consumers.
Pippa Gilroy is a Digital Marketing MSc student, content creator and social media enthusiast with a passion for writing about the latest industry trends.
Instagram: @pippagilroy / TikTok: @gilroypippa / Twitter: @pippagilroy