The Current State of Influencer Marketing

Whether you’re hopping onto your favorite social channel or adding to an online shopping cart, you have probably been influenced by an influencer or two. Influencer marketing seems to be nearly ubiquitous.   

• For a good reason: Markets and Markets reported that influencer marketing currently has a market size value of $14.2 billion with an increased compound annual growth rate of 37.1% estimated in 2023. This is the projected forecast for 2019 to 2028.
• The why behind the growth: Influencers pick up where brands fall short by showing how products improve people's lives through first-hand experience. While brands tend to show the features of their products, influencers excel at showing inspirational, educational, or aspirational content.

It’s Only Going to Keep Growing

Influencer marketing has created high-value opportunities in 2024 based on its current market size value, but does that mean it’s at its apex?

• Influencers on the rise: It doesn’t look like the space will stop growing anytime soon. According to Hello Partner, the market value is expected to reach an estimated $22.2 billion by 2025, a large increase from the value of $13.8 billion in 2023 estimated by SkyQuest reporting.
• More creators may mean more audience opportunities: The job outlook for influencers is predicted to increase by 5.7% over the next 10 years according to Lightcast.

The Reason for its Growth

• It’s cost-effective: Many brands consider influencer marketing a more affordable way to supplement their content creation efforts. In-house content production tends to be more expensive. This also drives down customer acquisition costs.
• Diversity of content: Growing a team of ambassadors/advocates builds a group of people who can advocate for your brand/products.
• The brand vs the individual: As digital spaces continue to change, so will marketing strategies. There’s a growing mistrust of brand-created content. Plus with the prevalence of ad-blockers now, brands are shifting digital marketing budgets to influencers. Audiences are beginning to prefer one-on-one conversations rather than branded advertisements. This is also one reason why social media marketing is also popular, as news feeds aren’t blocked by ad blockers.
• Measured Success: Brands’ C-suites want to see data, and that’s it. You can’t show impact without data, and vanity metrics don’t cut it. With influencer marketing, you can often see the impact through data and once brands understand that, they’re in. We recommend checking out some of our other posts on our Carusele site, like our post “Why Follower Counts Don’t Matter in Influencer Marketing” or “25 Ways to Measure Influencer Marketing” to dive deeper into this topic.
  
  

Who’s The Next Influencer

As more creators emerge and grow popular, what can we expect from the next group of influencers?

• Understanding the difference: Influencers can be categorized into tiers based on their follower count. such as Micro, Mid-tier, and Macro. Micro-influencers are around 20,000 to 500,000. Mid-tier can range from 500,00 to 1 million. These ranges are flexible and are often used somewhat differently by different sources as a way to categorize influencers.
• Finding the right fit: Depending on your niche and your strategy, different types of influencers might fit your needs best. For example, Macro Influencers allow your brand to reach a larger audience, while Micro Influencers allow you to build a deeper connection, as they typically have higher engagement levels. Either way, look for influencers who are more selective with their partnerships. Their opinions are valued higher by audiences and their content usually performs better than that of someone who promotes every new product they can get their hands on.
  
  

Where They Are Going Next

Based on the past and present market trends, what can we expect from influencer marketing in 2025?

• Channel ranking: According to HubSpot, the number one place to try your hand at influencer marketing is Instagram.  In their survey, 30% of marketers said they get their biggest ROI from this channel, followed by YouTube and TikTok. There are several other social channels with large audiences such as Pinterest, LinkedIn, and Snapchat, but they don’t yield as high returns as the big three listed above. One specific perk of Instagram is its ability to make posts shoppable when a brand sponsors a creator's post.  
• Audience predictions: Major platforms will remain the face of influencer marketing, even as there may be more introductions of niche platforms like Blue Sky and BeReal. According to one study, 60% of social users under the age of 30 prefer smaller communities. Having said that, we don't expect brands to invest much in influencer marketing for these channels in 2025 as they haven't yet reached critical mass in terms of user adoption.
• New audience opportunities: Growth trends can provide valuable insights into where you can get the biggest return on your partnership, but this data doesn’t mean you should discredit up-and-coming channels. One channel trend we are keeping an eye on is newsletter-modeled channels.

Substack went full court this year to increase the number of creators on the platform, which saw some pretty good results. However, subscribers pay a monthly fee, typically $5, to read content. This may deter some audiences, as they are making a shift from their previously free model. On the other hand, newsletters and other private channels can give brands access to dedicated and loyal audiences with more personal connections to those influencers. Not all impressions are created equal, after all.

What Do Influencers Want You to Know

• Understanding new costs: As market value and influencer marketing budgets continue to increase, it seems like influencer rates may continue to climb, as well. This can be seen through larger influencers who can command top dollar for their partnerships. Deals may include additional costs for brand rights and ad access. However, smaller influencers in the most popular categories may lack leverage in negotiations given niche saturation. So it may be a good idea to make sure you and your influencer(s) are on the same page regarding cost, duration, and deliverables.

2024 brought many new changes to social media marketing, and in 2025, we expect influencer marketing to continue to be a key factor in brand and agency budgets alike.

Ready to develop your influencer marketing strategy for 2025? Contact us today.