Our Two Cents: Influencers by the Numbers
Decoding the world of influencing and freelancing
A quick introduction before we begin: You will hear from us every Monday and Friday at 9 am on the dot. The newsletter has 2 segments- one covers all things personal finance and the other is a miscellaneous (read: chaotic) college-related collective. Monday’s newsletter, titled ‘Our two cents’, is dedicated to personal finance and this is where we divulge our college-centric take on the subject of saving, budgeting, investing, and the like. Friday’s newsletter, titled ‘In other news’, covers just about everything else- from research papers to student loans to so much more. And with that out of the way….
Hi there! Top of the morning to you. It’s that time of the week again. In today’s edition, we talk about the world of influencers - how they make money, how much they can make, and why this information is relevant to students. Without further ado, let’s dive into it.
📨 A little context
Social media has practically taken over the way we, as consumers, consume information in the form of advertisements and news. Scrolling for hours at end and being exposed to the countless ‘influencers’ and this new sect of social media moguls, has made us wonder whether the clout that these ‘creators’ are getting even pays bills or not.
🔍 The focus
According to a report by Lego, 1 out of every 3 kids wants to be a Youtuber. Further, with a 5-year-old kid being the richest You-tuber in 2020, this trend is here to stay. Hence, it is worth understanding how much a content creator makes and how big this paycheck can get at different levels of the influencer ladder.
A quick search on Youtube about ‘How much do influencers make’ reveals a ton of videos made by the top 1% of the content creation hierarchy. Most of these creators have the following sources of income in common, this is largely because of their high following and long-term commitment to a particular social media platform:
Paid Partnerships/ Brand Deals- Since the product offering of an influencer is a social media post, most of the scope to earn lies in this domain. Post formats can range from static posts, short skits to quick reels. Influencers have become a new-age billboard with a much more targeted audience. Brands look at metrics such as active users, follower growth, and average views/likes per post etc. before entering into a brand deal with an influencer. The deal structure can have a pay per follower format. As a general rule of thumb, many influencers consider $10 per 1,000 followers to be a good starting point for beginners, however, this rate can increase multifold as your post-engagement and follower count increases.
Youtube views- Since a lot of Influencers with >100K followers tend to have Youtube channels along with their social media presence, it is only right to include this income stream while understanding their paycheck. The Cost per 1,000 impressions (CPM) for Youtube depends upon the region and genre of videos being posted. Based on the advertiser-friendliness of the video, ad-format set by the Youtuber, and monetized playbacks, the CPM can range from less than a dollar to $2+. Youtube lays down a criteria for monetization eligibility as well. Only after fulfilling this criteria can you start monetizing your Youtube Channel.
Merchandising- To make this list streamlined, we’re including clothing lines and self-authored books under the purview of Merchandise income. The structure of these deals is a royalty-arrangement, where the creator earns a fixed percentage of the sale price of the merchandise.
For smaller micro-influencers with followers ranging from 10K to 100K, the income avenues are much more nuanced. Since it is generally believed by companies looking to market their products on social media that lower following ensures more targeted and niche marketing, smaller influencers can leverage their follower demographics to make the best out of their personal brand.
Affiliate marketing- It is quite common to see influencers asking you to use a particular code while making a purchase at a particular website to avail a discount. What happens here behind the scenes is that the influencer is paid a small percentage (5% - 25%<) of the sales that are made via this affiliate code. This income stream is something that a lot of micro-influencers tap into considering their follower demographics.
PR deals- Up and coming brands tend to offer Barter deals to influencers wherein they may send PR packages with the expectation of an Instagram Story promotion or any other form of content. Some platforms offer hotel stays, international trips and even food samples in exchange for promotion via the influencer’s social media page.
While there is no standard number that you can expect to earn while starting out in this field because of the nascency of the influencer industry and creator economy, a lot of influencers spell out their payment mechanisms on their social media pages. At the end of the day, social media as a side hustle is also quite lucrative and it is important to understand the long gestation period of making it big in this industry.
👋🏻 Bye-bye
………Aaand that’s a wrap. See you Friday :) Of course, we can correspond earlier if you liked the ‘did you know’ format and have a couple other topics you’d like for us to cover in the coming weeks. Feel free to use the comment section or write to us at witmeup.in@gmail.com. Alternatively, you can anonymously provide your valuable feedback here. Thanks, and toodles!
super insightful as always :), loving the versatility!