Instagram is easily one of the fastest growing social media platforms that people are using today, recently reaching up to 600 million users with additional new features such as Instagram Stories. Instagram’s user friendly interface has made it a popular platform for individuals, content creators, and advertisers alike which has charted the explosive growth of influencer marketing on the platform. Influencer marketing, projected to be a $5-10 billion market by 2020, utilizes social media stars, or influencers, to reach an entirely digital-first and mobile population of consumers.
Instagram has been long utilized as a platform for brands to conduct influencer marketing campaigns, however, lack of advertising transparency means that there are no official metrics for the industry. Based on a yearlong research study, Mediakix, found that advertisers are currently spending over $1 billion on influencer marketing on Instagram alone. This number is expected to more than double in the next two years to $2.38 billion.
The Instagram influencer market size can be broken down and examined through individual brand sponsored influencer posts. To get an idea of how many sponsored posts are on Instagram, the number of FTC required hashtags, which include #ad, #sponsored, #spon, and #sp, were determined (Chart 2).
We found that in 2016, the total number of brand sponsored influencer posts was 9.7 million and estimate that the total would grow to 14.5 million by the end of 2017. This means that a total of 4.8 million posts tagged as sponsored will occur in 2017. However, not all posts using these hashtags were always sponsored. Using averages from a sample size of tagged posts, it was determined that only 58% of tagged posts were actually sponsored posts.
Next, average compensation for a sponsored post was determined as $320 using aggregated data (for comprehensive methodology, visit Mediakix’s study). Monthly spend is translated to $90 million in 2017 meaning that the annual spend on Instagram influencer marketing this year alone will exceed $1 billion. The average compensation was applied to the number of sponsored posts, placing the current market at $130 million spent per month by 2018 and at least $200 million spent per month by 2019. By the end of 2019, influencer marketing on Instagram should be able to reach $2.38 billion and with 10.6 million sponsored posts in the year.
Instagram Influencer Marketing Could Reach $ 2 Billion By 2019
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Evan Asano is the CEO and founder of Mediakix, a leading influencer marketing company that works with top brands and social media influencers. Evan has been published in Forbes, Inc., and Fortune. In his spare time, Evan enjoys surfing, photography, scuba diving, and traveling.
Since 2011, Mediakix has worked with the largest and fastest-growing brands on influencer marketing campaigns across YouTube, Facebook, Instagram, Snapchat, and top lifestyle blogs. Mediakix draws upon its social media influencer network of thousands and years of campaign performance data to develop customized, ROI-driven campaigns that meet and exceed its clients’ marketing and business objectives. From initial strategy to campaign execution and analysis, Mediakix offers the best comprehensive and managed services for its clients. These brands, which span across all major industries, include Nordstrom, Blue Apron, LG, Birchbox, Fairmont Hotels, UberEATS, Sleep Number, David Yurman, Participant Media, and many more.