What Is The Influencer Bubble? (And Is It Really Going To Burst?)
Forbes recently released its list of the world’s top 30 influencers in the categories of fitness, beauty and home. Coined as ‘media power players’ by the magazine, the reach and value of these influencers is astronomical. The combined Instagram following of just the 10 beauty influencers is more than double Australia’s population, so it’s not hard to see how this social movement has gone from a media buzzword to a key part of many marketing campaigns.
Influencing is a very lucrative career path, if you can make it
Topping the beauty list is Zoe Sugg, a British beauty and fashion entrepreneur better known as Zoella. With almost 12 million YouTube subscribers, over 10 million Instagram followers, her own beauty line and a series of novels (plus more), her estimated income at the end of 2016 was reportedly about £50,000 ($83,000 AUD) per month. Her overall net worth is about £3 million.
Looking closer to home, Adelaide native Kayla Itsines took out the number 1 spot on the fitness list with an estimated fortune of $46 million AUD thanks to brand endorsements, fitness programs and her own Sweat with Kayla app.
Now, after almost a decade of digital influencers, the market is becoming more and more saturated as an increasing number of brands tap into the social power of these figures. Good influencers are considered authorities in their chosen field, and when they recommend or feature a certain product, you can be sure their endorsement will drive sales. However, this method relies on authenticity – and that’s where we begin to run into issues.
Now we have the ‘influencer bubble’
Influencer marketing didn’t have a blueprint, and it blew up very quickly on an incredible scale. You’d be hard pressed to find a big brand now that hasn’t employed at least one influencer to spruik a product or attend an event. This has created a bubble based on a lack of transparency and measurable results.
Influencer marketing is all the rage, but no one actually seems to know what’s going on. Last year, a social media executive anonymously published an article on Digiday that illustrated some key problems of this ecosystem – in particular:
“We threw too much money at them and did it too quickly.”
The increasing cost to work with these influencers means brands and marketers have to become more critical about the ROI for these projects. And now we’re at a tipping point where many industry professionals are speculating that the bubble is going to burst.
From one side, you have the brands that want to be able to measure the impact of their investment. Meanwhile, the increasing volume of sponsored content has caused consumers to be more critical about which brands are featured in their favourite blogger’s feed.
New guidelines from the AANA also mean that influencers have to be very discerning about which brands they partner with, as their audience will be able to instantly tell whether a post has been paid for. Sponsored collaborations are a large source of income for many influencers, and in most cases their readers understand that it’s part of their job. However, Nick Fordham from The Fordham Company told Mumbrella that it’s not sustainable for influencers to pretend that a product is part of their life without disclosing payment anymore. Pressure also comes from the audience, who are not afraid to call them out on an inappropriate or misleading brand advertisement.
So, what does this mean for brands now?
Plenty of the top-tier bloggers now charge fees that are inaccessible to many brands, so we’re definitely seeing a shift in the industry towards micro-influencers and more authentic content. Micro-influencers tend to have a higher engagement rate, so they can provide a valuable opportunity for brands to attract a specific audience.
“In the past, campaigns consisted of one influencer. 2016 it was in the tens. 2017 it will be in the hundreds. 2018 it will be in the thousands. All the while getting more meaningful as it shifts from celebrities to everyday citizens being rewarded for celebrating the brands they already use and love.”
This shift in the industry suggests that, indeed, the influencer bubble is going to burst. As marketers look for better consumer engagement and ROI, success requires companies to focus on producing authentic, engaging content. And some brands are opting out entirely and becoming their own authentic advocates. Quality content attracts genuine followers and, in turn, generates revenue for both bloggers and brands.
So how do you decide if an influencer is right for your brand? Luckily for you, we’ve got a whole article about how to find bloggers and measure engagement rate – check out this post for more wisdom from the Search Factory | iProspect team.