Social media monetisation paved way for influencer economy
Social media has become a regular part of our daily lives.
Social media is everywhere. Almost everyone with internet access uses some form of social media or the other. We find ourselves scrolling through the same few apps all the time, every day. The nature of media consumption has also changed dramatically over the years, and social media has changed the way we do everything.
There has been a spectacular rise in the use and popularity of social media, and this COVID 19 pandemic has only exacerbated that. Because of extended lockdowns and social distancing norms, people have been forced to switch to the ‘digital’. Communication and connectivity both have become essentially online.
In 2020, there were 4.14 billion social media users in the world. Social media usage continues to grow alongside internet penetration, and if the growth rate stays constant, estimates forecast there could be more than 4.2 billion social media users by the end of 2021.
Why is social media marketing so important?
Viewers now decide when and how they consume media. Internet, OTT platforms and social media give a consumer the freedom of choosing the kind of content they want to see. Without having to suffer through commercials to catch up on your favourite show, people now have the option of skipping the ads or just tuning out. Suppose, if a huge TV campaign is made, but the target market is one that exclusively consumes content on Netflix, all efforts will have been in vain.
With the decreasing popularity of traditional advertising, unless social media is used as a tool to reach out to a specific target audience, it will become extremely hard to reach their target demographic.
Who are the ‘Influencers’?
We, today live in a world where, the device in our pockets can show us advertisements in nearly any form—be it video, images, or audio, any time we want.
This is where the social media influencers come in.
Everyone on any social media platform now has heard of them. They are mostly ‘content creators’ with the power to affect the purchasing decisions of the people who engage with their content. While celebrities are already followed by their considerable fan bases, it’s not surprising that businesses use their social media platforms to endorse their products or services. But now, as more and more users are joining social media platforms like Facebook, Youtube, Instagram, Pinterest, Snapchat, and Twitter, every passing day, many across the globe have started creating and curating content in the form of stories, photos, and videos for others to see. Social media has given them a platform and opportunity to build their own brands by stimulating and encouraging engagement on the content they create. They have as a result gradually been able to create a distinct niche of followers depending on the genre of content they create.
It is natural human psychology to trust a friend or an acquaintance more than advertisements. That means even if you can get your potential customer to see your ad, there is a very high possibility that they will not trust it. And there can be no sale, without trust. Influencers on these platforms have mass scale acceptability and relatability and are thus the closest alternative to the friend who everyone trusts.
How does the ecosystem work?
Their social media clout is used by brands to promote a brand to a certain demographic that follows a given influencer. Social media influencers have the power of reach and spread the word digitally. This makes it easy for followers, who have chosen of their free will to follow them, to retweet, reblog, repost or replay that content with just the touch of a finger.
When it’s an appropriate match between company and influencer, it benefits everyone and is quite symbiotic. The influencer, through sponsored posts and endorsements, can promote a brand, increasing their brand sales, at the same time increase their media presence.
Over the last few years, brands have collaborated with social media influencers across a variety of interests to generate awareness and reach a target audience. It is, however, important to note that these individuals are not merely marketing tools, but rather social relationship assets with which brands can collaborate to achieve their marketing objectives.
How has monetization helped the rise of influencers?
Firstly you have to understand how social media monetisation primarily works. The thing about social media is that it offers so many different angles for monetization. Some of the ways are as listed below-
More than 50 million people worldwide claim to be ‘content creators’, of which 46.7 million considers themselves to be amateurs, while two million-plus consider themselves to be professional creators, earning enough from it, for it to be their full-time income.
Half of these professional creators earn their money on YouTube, with 25% making their money via Instagram (predominantly as influencers). Amongst the amateurs, the largest group here (30 million) makes their money as Instagram influencers, although there are quite a few whose main medium is Youtube. (12 million).
Influencer marketing is expected to be worth $13.8 billion this year, which is up from $9.7 billion in 2020, according to Influencer Marketing Hub’s 2021 Benchmark Report. The figure represents a significant increase from 2016 when the industry was valued at $1.7 billion, so it is safe to say that it is a rapidly growing industry. Given the relevance and importance of social media in society today, it can also be said with a fair bit of certainty that this industry or the influencer economy is here to stay, and only bound to get bigger and more powerful.