How Much Do Firms Spend on Influencer Marketing in 2023?

Unless you’ve been living under a rock the last few years, you’ve surely heard about the rise of influencer marketing. Influencers are literally everywhere. These days it seems like every young person’s goal is to get famous on social media.

Which is quite understandable.

Influencers are popular. People admire them. They earn money by promoting their lifestyle.  Marketers adore them.

Doesn’t that sound like the dream life?

Today, however, we are here to look at how much marketers spend on influencer marketing - and whether you should also invest in it.

To put things in perspective, let’s kick this off with some hard facts.

Mind-Blowing Spending on Influencer Marketing

• 90% of marketers have planned an increase in their influencer marketing budgets
• Global influencer marketing budget is expected to reach $5-$10 billion in 2020
• Instagram influencer marketing spend alone is expected to reach $8 billion in 2020
• In 2018, the average ROI for every dollar spent on influencer marketing was $6.50
• 49% of customers rely on influencers’ advice
• 94% of marketers deem influencer marketing campaigns successful
• Marketing managers point to influencer marketing as the “fastest-growing online customer-acquisition method”

Those are quite astonishing numbers.

Alright, before we take a deep dive into the world of influencer marketing - let’s learn the lingo first.

What Exactly Are Influencers?

Influencers are people with big social media following. They have managed to earn the trust of their followers and can influence the way they behave.

Unlike celebrities, who have lost their credibility in the eyes of consumers, influencers have quite the authority among their “fans”. They spend a lot of time tailoring their social media image and would not risk it to promote something just for the sake of getting paid. This is why people find them trustworthy.

What Is Their Role in the Marketing World?

Because of their credibility, influencers are currently widely popular in the marketing world. With their help, marketers gain exposure and attract new clients.

49% of customers rely on influencers’ advice.

That’s a huge pool of potential customers and the number one reason to join forces with influencers.

Collaborating with influencers means they “lend” their reputation and let marketers use their endorsement to raise brand awareness.

Marketers and influencers agree on the cost per post. They also discuss the number of posts, the type of content, and the length of the contract.

If you need more information about social media influencer marketing and how to go about it, you can find it here.

How Big Is Influencer Marketing?

Ain’t that the million-dollar question?

Marketing managers point to influencer marketing as the “fastest-growing online customer-acquisition method”.

Operative word - growing. We can’t exactly pinpoint its size, as it’s constantly expanding.

As social media keeps growing, so does the influencers’ fame.  Internet fame > likes > engagement > clients.

It’s no wonder that marketers are so keen on collaborating with influencers.

In fact, 90% of marketers have planned an increase in their influencer marketing budgets.

Which raises a few questions.

How Much Does Instagram Influencer Marketing Cost?

It truly depends on a few things:

• platform of choice
• type of influencer (nano, micro, mid-tier, macro and mega, defined by the number of followers)
• length of collaboration
• number of posts
• types of posts (photos, videos, posts, stories, IGTV content)
• production costs

1. Experts predict that influencer spending will reach $15 billion by 2023.

That’s about $14.5 billion more than it in 2015.

As brands become more aware of influencer marketing capabilities over the years, they’re increasingly willing to pour more money into the mode of advertising. 

And if that’s not enough, here comes the really good part.

The global spend on influencer marketing is was between $5-$10 billion in 2020.

But wait.

Where does all this money go?

One Platform to Rule Them All?

There are a lot of social media platforms and each has its pros and cons. But which is the most popular one?

According to recent research, it’s Instagram. It has been dubbed “the fastest growing social media network”.

2. Influencer marketing global spend for Insta influencer marketing was around $8 billion by Q4 of 2020.

Marketers sure do love good ol’ Instagram.

It turns out influencers marketing strategies on Instagram are the most efficient of them all. Why?

It’s been widely discussed that people prefer visual content to text.

Instagram offers a lot of freedom and variety when it comes to sharing visuals. Posts, stories, live streams, and IGTV are all at your disposal.

Also, Instagram has one feature that’s a true game-changer - shoppable photos. Instagram allows business accounts to tag their photos with products. Clicking on the tags redirects you to the product’s full description and our favorite call-to-action button “Shop now”.

But let’s not forget that our main focus here is influencer marketing spend.

So let’s talk numbers.

3. The number of sponsored posts on IG in 2020 was over 6 million. That figure had come a long way since 2016, when it was 1.2 million.

Instagram influencer marketing budgets are expected to hit $8 billion in 2020.

Marketers are obviously die-hard Instagram fans.

What is the fee per post on Instagram?

Well, according to Matt Crump, an Instagram influencer, it all depends on the number of followers.

He shared with Later his fee guide and rates per post.

The variation in pricing comes from the deal itself and from the digital influencer of choice.

One fee does not fit them all, it seems.

Some social media agencies, however, claim the easiest formula would be $10 for every 1, 000 followers.

But enough about Instagram.

What about other platforms?

It's a Video World

Instagram might be the fastest growing platform, but it sure isn’t the only one allowing video content.

It’s been proven that 80% of people remember video content better than any other type, so it’s only logical to invest your energy that way.

What’s the first platform that comes to mind when someone mentions video?

That’s right.

YouTube, the original birthplace of vloggers, who later turned into influencers.

Obviously, creating a video is a lot more effort than just taking a photo and editing it. Naturally, vloggers charge more than other influencers.

Using the formula we mentioned above, YouTubers get $20 for every 1,000 followers.

YouTube also relies on views, though. It was estimated that marketers pay from $50 to $100 per 1,000 views. It’s a good idea to go through the videos of the vlogger you’ve chosen and check the average views they get.

Calculating your influencer marketing budget for Snapchat is a bit trickier. The platform doesn’t show followers count, so it’s all about the views. Some rely on the views for the first Snapchat story, while others look at the numbers for their campaign.

Roughly, marketers tend to pay around $100 per 1,000 views on Snapchat.

What About Facebook and Twitter?

Interestingly enough, Twitter and Facebook aren’t really popular for influencer marketing.

Influencers themselves don’t really focus on those social networks. Twitter is mainly used for shoutouts and Facebook - for promoting content from other social media.

Both platforms, however, can be used to connect with customers. And positive customer experience is vital for any type of marketing strategy.

The Surprising Player

Ladies and gentlemen, please welcome to the marketing stage - Twitch.

Twitch, for those who don’t know, is a video streaming platform, immensely popular among gamers.

You’re probably wondering if it can be useful for influencer marketing.

Twitch influencers, like any other type of influencer, have a large number of followers. While they won’t have the same approach as, for example, beauty influencers, they can still promote your product.

Twitch influencers can mention a product while streaming or they can place the product near them, so it’s visible for their viewers. Also, brands can become sponsors for the streamers, thus gaining exposure.

And when it comes to how much to spend on your influencer marketing strategy with Twitch, there’s again no definitive answer. As the platform is somehow new to the advertising world, we can’t even apply the formula we used for Instagram, Youtube, and Snapchat.

That uncertainty can give you a lot of advantages, though. Less competition and maybe even the chance to negotiate lower prices per followers or views.

Our advice - don’t underestimate Twitch, dive into it and make it a part of your influencer marketing strategy.

Now that we’ve mentioned two industries - video gaming and beauty - let’s discuss influencer marketing spend per industry.

Marketing Spend by Industry

We can’t give exact numbers for every social media and every industry, as it varies for every influencer. We can, however, give you an average for the most popular platform - Instagram.

According to a research made in 2017, travel influencers get paid the most for sponsored posts. On average, they earn $220 for every single one.

They are closely followed by entertainment influencers, such as comedians and gamers, who get $209 per sponsored post.

The honorable third place goes to home and lifestyle influencers. Their fee for a sponsored post is $204.

Health and fitness influencers require $193 for a post, while the fashion ones charge $173.

In the photography sector, a sponsored post will cost you roughly $171.

If your influencer marketing strategy is food and drinks related, you might want to prepare around $169 for an Instagram post.

Beauty influencers get paid $160 per post, while those in the art and design sector - $148.

The last ones to shape the Top 10 are business influencers, whose fee per post is $134.

That clears the fog a bit, doesn’t it?

Go now, run off to plan your influencer marketing budget.

Or are you still wondering if the influencer advertising industry is worth it after all?

Well.

Let’s Talk ROI

Listen.

Nowadays, influencer marketing is huge.

94% of marketers deem influencer marketing campaigns successful.

If you’re in the 6 % that haven’t tried this tactic yet, you are most likely missing out.

But that’s not all.

The average ROI for every dollar spent on influencer marketing was $6.50.

The top-earning would get $20 or even more.

In 2018, marketers claimed they get 11x times higher ROI from influencer marketing strategies than from using the old-school channels, such as TV and magazines.

If an influencer with around 42K followers posts eight stories and posts per month, they can typically earn $37K per year.

According to influencer marketing statistics, TikTok influencers need at least 270 million views per year and 10,000 subscribers to make $100K annually.

Besides regular Tik Tok accounts, Influencers also have a chance to make money via TikTok Creator Fund. However, note that you need to have 100K views in the last month and 10,000 followers.

Key Takeaways

So what’s the bottom line?

Not only is influencer marketing huge, but it’s getting bigger and even more vital to any success you may have online. It has managed to outshine most of the old-fashioned marketing channels.

We already mentioned that influencer marketing spend is expected to hit the mind-blowing $5-$10 billion in 2020. Even today, a staggering 94% of marketers deem their influencer marketing strategies successful.

So if you haven’t already, you should try dipping your toes in the influencer marketing world. Who knows, you might find you like it.

Hopefully, you found these insights on influencer marketing spend useful. Till next time!