For many, being a social media influencer has transformed from a side gig into a multimillion dollar business. Creators now have more say in the sponsored content they create for brands as well as the earnings they receive. And as creators continue to prove themselves as influential brand advocates, marketers are tapping these influencers for content beyond social feeds, including TV, out-of-home, and other digital media.
Influencers have also proven resilient amid economic uncertainty and an increasingly crowded space. Influencer marketing spend rose roughly 3.5 times faster in 2023 than social ad spending, according to eMarketer’s July 2023 forecast.
In this guide, we explore the current state of influencer marketing, and why marketers, social platforms, and media companies should adjust their strategies as the power of the creator economy grows.
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What is the creator economy?
The creator economy, also called the influencer economy, is the interconnected ecosystem of creators, audiences, digital platforms, marketers, and agencies and/or vendors. The creator economy, as defined by eMarketer’s Creator Economy Explainer report, enables creators to generate revenues in the form of money, goods, or services through their content, usually delivered via social media platforms. Meanwhile, marketers can partner with creators to build awareness for their brands.
Because interaction among stakeholders is constantly evolving, revenue data is sparse. A March 2023 estimate from Citigroup values the creator economy at $65.2 billion in 2023. By 2024, that figure is expected to reach $74.0 billion.
What is influencer marketing?
Influencer marketing involves a celebrity, content creator, subject matter expert, or public figure endorsing a brand’s product or service to drive social proof.
The market is rapidly expanding as influencer types have increased, with influencers filling every conceivable niche and sub-niche interest.
Here are the types of influencers, based on follower count and focuses:
- Mega-influencers: Often celebrity influencers, those accounts with more than 1 million followers
- Macro-influencers: Influencers with a follower count of 100,000 to 999,999
- Mid-tier influencers: Influencers with a follower count of 20,000 to 99,999
- Micro-influencers: Followers ranging between 5,000 to 19,999
- Nano-influencers: A community of 1,000 to 4,999 followers
- Kidfluencers: Gen Alphas with social followings that often review toys and games
- Gaming influencers: Esport and video game players who discuss game strategy and livestream while in-game
- Virtual influencers: Computer-generated avatars like Noonoouri, a fashion model and digital-only popstar
The pandemic sped up changes in influencer marketing that were already underway, such as the trend toward “unfiltered” or less-scripted content, the rise of TikTok, and the popularity of “everyday influencers” with genuine and relatable personalities like Elyse Myers.
Industries like financial services that hadn’t invested in influencer marketing earlier are also learning to navigate the space. And as ecommerce and social media converge, influencers will become increasingly vital intermediaries, helping to connect brands with consumers on social media.
Creators vs. influencers: What’s the difference?
Creators create content. Influencers are creators if the content they develop can sway the purchase decisions of a population regardless of whether they are being paid to promote a product. The term refers to a wide group of people from celebrities to loyal customers. Creators are influencers if their content affects purchase decisions.
Who is a creator?
Everyone has the potential to be a content creator thanks to how the term is defined. Adobe estimates there could be up to 303 million creators worldwide. For context, that figure is close to the US population at the start of 2023, per the US Census Bureau.
Most content creators worldwide are under 41, but there are creators of all ages, including Gen Xers and baby boomers, per Adobe.
Creators over 60 years old, dubbed “granfluencers,” have found popularity on social media due to their cross-generational appeal.
For example, Nonna Pia, a TikTok account with 4 million followers, features a grandmother who cooks classic Italian dishes while her grandson narrates. Similarly, the Instagram account “Excuse My Grandma” follows a grandmother-granddaughter duo as they discuss generational differences in dating, fashion, and more.
Although there is an account for every interest and target audience—from foraging to chiropractic medicine—lifestyle, fashion, and beauty are among the top creator categories.
While broad, these top categories overlap with many other industries, including travel, health, entertainment, food and drink, and art. Cross-category appeal is ideal for brand marketers looking to expand their reach to find like-minded audience demographics.
Areas that have seen recent growth in creator focus include:
A 2021 NCAA policy change allows college athletes to be compensated for their name, image, and likeness. College athletes already command large audiences and regularly create content on social media, per August 2022 data from Curastory.
Industry professionals are increasingly building audiences by sharing B2B content online. For example, a “LinkedInfluencer” is an influencer on B2B social platform LinkedIn.
Nearly 1 in 4 people in the US are on LinkedIn, according to eMarketer’s May 2023 forecast, as both the creator economy and B2B ad spending grow. As buyers get younger and B2B marketing becomes increasingly digital, authenticity and experience will matter more in marketing.
In the financial sector, “finfluencers” use their social media platform to share videos that cover personal experiences, tips, and advice about investing, budgeting, financial trends, and the economy.
Finfluencers are capitalizing on a widespread lack of financial literacy. However, the quality of the content is controversial because some creators do not have a professional background in finance. Despite concerns, 60% of investors ages 18 to 35 use social media as a source of investment information, according to a Finra Investor Education Foundation report.
The generational response
Younger shoppers are more likely to use social media. About 129.5 million US Gen Zers and millennials will use social media in 2024, per a May 2023 eMarketer forecast.
Younger shoppers are also more likely to follow and buy from accounts run by influencers. A Q2 2022 Klarna survey found that over 40% of Gen Zers and millennials worldwide follow influencers, compared with one-quarter of Gen Xers and less than 10% of baby boomers.
Often considered a millennial concept, influencer culture is embraced by this extremely active social media user base. Close to 70 million US millennials will use social media next year, per eMarketer’s May 2023 forecast.
Millennials look to trusted influencers for product recommendations, reviews, and as a discovery point for new brands.
They’re also willing to purchase what they see being promoted by their favorite influencers on social media. Over half (54.1%) of US social network users ages 25 to 34 will make a purchase on a social platform in 2024, per September 2023 eMarketer data.
In 2024, 60.7 million US Gen Zers will use social media, according to eMarketer’s May 2023 forecast. And while that growth is expected to continue through 2027, Gen Z will remain slightly behind millennial users.
Gen Zers, however, are not as sold on following influencers as their older peers. Less than half (48.6%) use social media to view creator/influencer content, according to a July 2023 eMarketer survey’s findings.
Where influencers do have an outsize influence over Gen Z is women’s beauty and wellness. Close to 80% of Gen Z women rank creators as their most trusted source for beauty recommendations, a survey conducted by LTK found.
Those recommendations are also turning into online and offline sales. Eighty-three percent of Gen Z women shop for creators’ product suggestions online, and 82% shop for those items in-store.
Influencing by “de-influencing”
While the majority of influencers promote what to buy, some influencers are turning to platforms like TikTok to tell their followers what not to buy. As of January 2024, #deinfluencing videos on TikTok have roughly 1.3 billion views, up considerably from 208 million in February 2023.
Seen as a method to combat overconsumption in a tight economy, deinfluencing videos often offer economical alternatives to expensive products or discuss the pitfalls of fast-fashion shopping hauls.
Creators also use de-influencing videos to share critical commentary to distance themselves from brand controversies and post honest reviews of products that don’t meet expectations. Doing so can help reinforce creator trust through authenticity and transparency.
Influencer marketing spend
In 2024, advertisers will spend $5.89 billion on influencer marketing, a 14.7% increase YoY, according to eMarketer’s July 2023 forecast, which excludes paid media.
US influencer marketing spend grew more than three times faster than social ad spending in 2023, and it will remain ahead through 2025, according to a July 2023 eMarketer forecast.
Social platforms are reliant on creators, not the other way around, as creators’ options extend and include owned channels like blogs, podcasts, and newsletters.
A number of well-known creators, such as YouTuber MrBeast and podcaster Alex Cooper, have launched their own audio and video networks.
Although not every creator has a strong enough brand or following to create a successful media business, the growing success of these ventures should signal to brand marketers and entertainment companies that creators can offer much more than an outlet to generate hype or hawk goods.
Where influencers post sponsored content
Creators utilize a number of social media platforms.
To be impactful, influencer content should be engaging, entertaining, and educational, and marketers should work with credible creators who have built trust with their communities.
US marketers will allocate over $1 billion to sponsored content on each of the top four influencer marketing platforms in 2024, according to eMarketer’s July 2023 forecast. When it comes to influencer monetization, Instagram posts were the top format that creators worldwide were paid by brands to create in December 2022, per a Later and Mavrck December 2022 survey. Here’s a look at the top social media marketing platforms for influencers.
Instagram remains the top platform for sponsored content, per a June 2023 report from Mavrck. About 98% of US creators share brand content via Instagram feed posts, Instagram Stories, and Instagram Reels, while 69.1% go live on the platform.
As of June 2023, more creators worldwide report being paid to create Reels (98.0%) compared with TikTok videos (89.6%).
Creator monetization: In May 2023, Meta began testing a new payout model for Ads on Reels. The monetization program pays creators based on the performance of the Reel, rather than the earnings of the Reel ad, per TechCrunch.
As TikTok’s popularity rises, brand opportunities for paid content is likely to increase as well.
Influencer marketing spending growth on TikTok has grown 27.8%, compared with 12.7% on Instagram, according to eMarketer’s July 2023 forecast.
In 2024, over half of marketers (54.0%) will use TikTok specifically for influencer marketing, with $1.25 billion in US influencer marketing spend going to the platform, per the same eMarketer forecast.
Creator monetization: If an influencer promotes a brand’s product on TikTok Shop, the social app’s ecommerce tool, they can earn a commission through product sales. For both brands and influencers, TikTok Shop holds a lot of promise and room for growth. In 2024, we expect 40.7 million TikTok users to make a purchase on the app.
YouTube, like Instagram and TikTok, has a solid hold on influencer marketing. YouTube is the top platform for US adults to follow influencers, according to March 2023 CivicScience data.
eMarketer forecasts that in 2024, US marketers will spend $1.07 billion on influencer content for YouTube.
Similar to Instagram Reels, YouTube has been emphasizing Shorts as a cost-effective option for marketers.
Livestreaming is also leveraged by YouTube to connect influencers—and, ultimately, the brands they partner with—to followers. One-fourth (25.0%) of internet users say they watch creator- or influencer-led livestreams on YouTube, making it the most popular livestreaming app, ahead of TikTok (18.7%), Facebook (17.4%), and Instagram (14.0%), per an April 2023 survey by The Influencer Marketing Factory.
Creator monetization: YouTube attracts and retains creators in a number of ways. The platform offers a way to connect creator, artist, and brand stores to their YouTube channel, enabling users to more easily find and purchase featured products. YouTube also has affiliate shopping capabilities for creators interested in revenue opportunities.
Other platforms with influencer marketing potential include Facebook, Twitch, and to a lesser extent, Snapchat and X, the social media company formerly known as Twitter.
Despite its waning popularity among users, especially youths, Facebook is still expected to see $1.00 billion in influencer marketing spending next year, per an eMarketer forecast.
Popular with the esports gaming community, livestreaming app Twitch recently launched a number of features for creators. In July 2023, Twitch announced its Discovery Feed, made up of livestream clips and ad features that help creators share their content from other platforms such as YouTube, TikTok, and Reddit.
Snap has struggled with ad monetization and commands a fraction of influencer marketing spend compared with larger platforms. In 2023, Snap crossed $40 million in influencer marketing spending, and is expected to see growth of 3.4% in 2024.
In October 2023, Snap released Creator Collab Campaigns, a suite of tools to facilitate brand-creator partnerships on the platform. Previously, Snap’s primary focus was helping creators monetize directly on the platform through programs like ad revenue sharing.
X (formerly Twitter)
X saw total US ad revenues decline by 54.9% in 2023 after Elon Musk’s 2022 purchase, according to eMarketer’s October 2023 forecast, which means it is not an attractive platform for influencer marketing.
The aforementioned June 2023 Mavrck survey found that 45.9% of US creators shared promoted tweets, while a December 2022 Later and Mavrck survey found that 8.3% of creators worldwide have been paid by a brand to post on X.
Influencer marketing strategy
An influencer marketing strategy allows a brand to further its reach and tap new audiences, but narrowing down the right creator to work with requires an understanding of the landscape and what type of partnership will best serve the brand’s objectives.
Influencer marketing hubs: As influencer marketing took off, agencies dedicated to influencers sprang up to help brands manage the opportunity and vice versa.
Acting as a directory, influencer marketing hubs organize creator profiles by follower count per social platform, audience demographics, location, services offered, the price of partnership, and their interests (e.g., fashion, travel, home improvement, etc.), to take the guesswork out of selecting an influencer to partner with.
In addition to facilitating brand-creator relationships and identifying new talent, influencer hubs create campaign narratives, determine KPIs, and amplify influencer-led social campaigns, among other responsibilities.
For creators, working with an influencer marketing agency can be beneficial to scale and manage their own business. As influencer campaigns become more complex, an agency can manage payment, negotiate contracts, handle data analytics and reporting, and oversee other business functions.
Influencer marketing campaigns: An influencer marketing campaign is one that leverages the influence the creator has over their followers.
When in a paid partnership with a brand, the influencer campaign’s objective is to increase awareness, engagement, and, ultimately, sales. In comparison, an unsponsored campaign, while achieving the same objectives to various degrees, can be seen as more trustworthy and authentic by the influencer’s community.
Influencer campaigns fall into two categories:
- User-generated content (UGC) is organic content shared by a social media influencer to promote a brand or product without direct input from the featured brand. The influencer is not paid for UGC posts, and is often not as polished as content created with brand involvement. UGC posts range from product reviews, recommendations, tutorials, and personal experiences with a given good or service.
- Influencer-generated content is a collaboration between a creator and partner brand. These campaigns follow a brand’s creative guidelines—including tone of voice, talking points, aesthetics, and frequency of posts—to produce content fitting for that creator’s audience. As more influencers become trusted partners, brands have loosened the reins, allowing talent to tap into their own creativity for campaigns. Like UGC, influencer-led campaigns are more authentic and engaging, and may prove more effective for the brand involved.
Influencer posts: When paid for by a brand partner, an influencer post is a type of native advertising. When unpaid with no brand involvement, the post is considered UGC.
Most commonly seen on social media platforms, formats include Instagram photos with captions, short-form videos on TikTok, and long-form video content posted to YouTube. Influencers can also post written content on blogging platforms like Substack. Influencers will often promote their posts across various platforms to increase reach, engagement, and effectiveness.
While format is an important aspect of influencer marketing, the post’s creative should be at the forefront. According to eMarketer’s Influencer Monetization 2023 report, the “three E’s” of influencer marketing should be remembered when creating posts.
“Regardless of the format, each piece of content should be engaging, entertaining, and educational to drive the most impact,” according to eMarketer analyst Jasmine Enberg. Brands should also trust creators’ input on creative and format decisions because they know what will resonate best with their audience, Enberg continued.
Product launches: Influencers are an ideal way for a brand to launch new products.
When introducing a new product, brands can expand their reach by working with influencers with a similar following as the brand’s target audience. A kitchenware brand, for instance, may work with a popular food influencer to introduce a new range of pots to show off the products, its attributes, and how to buy.
As influencers become brands in their own right, many have launched their own product lines.
Thanks to an engaged and well-known audience, some influencers are able to develop products that align with the interests of the community they’ve built across their social media footprint.
For example, beauty vlogger and influencer Huda Kattan launched her own line of false eyelashes in 2013 after her community expressed an interest. Kattan then expanded the line into a full range of cosmetics. Huda Beauty, named after Kattan’s YouTube channel and blog, is now sold D2C and at Sephora.
Creators with large followings have launched food and beverage products, fitness programs, clothing lines, restaurants, and more to capitalize on their popularity and the value and willingness of their followers to support their businesses. Venturing into their own products also helps creators diversify their revenues and avoid alienating their audiences with too much sponsored content.
Collaboration: Similar to leveraging an influencer’s help to launch a new product, brands also partner with their stable of creators for product collaborations.
Often developed as a one-off or limited-edition product, brand-influencer collaborations can be a great source of product innovation.
In March 2023, Chipotle added two new limited-edition menu items to its quesadilla lineup, the “Keithadilla” and the “Fajita Quesadilla Hack,” which were developed and popularized by TikTok creators Keith Lee and Aleix Frost.
For some influencers, a brand collaboration may be a jumping-off point to developing their own product lines if the collaborative effort was deemed successful.
Common influencer marketing KPIs
These metrics are a good way for brands to measure their return on investment for influencer marketing campaigns:
- Facebook engagement rates (subscribers only): Engagement rate is defined as measurable interactions on social media posts, including likes, comments, favorites, retweets, shares, replies, and reactions, and is calculated based on all these interactions divided by total follower count.
- Facebook posts per week
- Instagram affiliate engagement rate: The percentage of an affiliate influencer’s audience that interacts with an affiliate influencer’s campaign or post on Instagram; this includes likes, comments, and shares.
- Instagram affiliate impression per follower rate: The number of affiliate-generated views that a specific post or piece of content received over a specific period of time on Instagram.
- Instagram affiliate reach: The percentage of followers and viewers from an affiliate influencer’s audience that is exposed to the affiliate influencer’s Instagram.
- Instagram affiliate view rate: The percentage of an affiliate influencer’s audience that views an affiliate influencers’ campaign or post on Instagram.
- Instagram engagement rates: Engagement rate is defined as measurable interactions on social media posts, including likes, comments, favorites, retweets, shares, replies, and reactions, and is calculated based on all these interactions divided by total follower count.
- Instagram posts per week
- Social affiliate clicks: The clicks generated by social influencer efforts, including generating traffic or leads (through affiliate links) to the company’s website.
- Social affiliate conversion rate: The percentage of clicks generated by social influencer efforts, including generating traffic or leads (through affiliate links) to the company’s website that also result in completed orders or purchases.
- Social affiliate engagement rate: The percentage of an affiliate influencer’s audience that interacts with an affiliate influencer’s campaign or post on a social media platform; this includes likes, comments, and shares.
- Social affiliate orders: The orders generated by social influencer efforts, including generating traffic or leads (through affiliate links) to the company’s website.
- Social affiliate sales: The sales or revenues generated by social influencer efforts, including generating traffic or leads (through affiliate links) to the company’s website.
- Social affiliate view rate: The percentage of an affiliate influencer’s audience that views an affiliate influencer’s campaign or post on a social media platform.
- TikTok affiliate engagement rate: The percentage of an affiliate influencer’s audience that interacts with an affiliate influencer’s campaign or post on TikTok; this includes likes, comments, and shares.
- TikTok affiliate view rate: The percentage of an affiliate influencer’s audience that views an affiliate influencer’s campaign or post on TikTok.
- X (formerly Twitter) tweets per week