Influencer marketing spend to hit $34 billion in 2023

Sponsored by the Influencer Marketing Trade Body

Issue #118 | Your reading time this week is 7 mins. 00 secs.

Welcome back to the Creator Briefing.

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Influencer Marketing spend to hit $34 billion in 2023

Move over Influencer Marketing Hub, Statista and Insider Intelligence, influencer marketing’s total global size has a new figure.

Research firm PQ Media's Global Influencer Marketing Forecast 2023-2027 forecasts global influencer marketing spend to reach $34.08 billion by the end of 2023.

PQ Media’s report provides compelling statistics on our sector. Here are a few killer stats:

• Global influencer marketing spending grew 21.5% in 2022 to $29.14 billion and is on pace to rise 16.9% in 2023 to reach $34.08 billion.

• In the US influencer marketing investments surged 22.2% to $22.19 billion in 2022 and spending is projected to rise 17.6% in 2023 (see story below for platform breakdown).

• The US market commanded 76.1% of global influencer marketing spend in 2022, up from 75.5% in 2017.

• The UK takes second spot with 6.6% of global spend.

• GROWTH SPURTS: India and Japan were the fastest-growing regions in 2022, jumping 33.6% and 33.1% respectively.

This week’s Creator Briefing is sponsored by the Influencer Marketing Trade Body the professional membership organisation dedicated to building a robust, sustainable future for the influencer marketing industry.

US influencer marketing spend by platform

US influencer marketing spend by platform for 2024 is forecast as follows according to Insider Intelligence:

• >$2 billion on Instagram

• Circa. $1.25 billion on TikTok

• Facebook and YouTube will hover at around $1 billion each

NOTE: these figures include payments made to influencers or their management to promote products on social media. The figures exclude gifts and payment in-kind.

The figures also exclude paid media BUT creators will play an increasing role in driving social ad investments. 97% of US marketers use influencer content outside of organic influencer posts, with 85% saying they combine organic with paid social (See the Linquia report below).

The State of Influencer Marketing 2023

Linquia, the full-service, influencer platform just released its State of Influencer Marketing 2023 report.

KEY HIGHLIGHTS

🔥75.5% said their budgets either increased or remained unchanged vs. the prior year.

🔥9.02% increased their influencer spend by >50% in 2023 vs 2021

🔥18% of respondents are spending >$1m in 2023.

🔥Of respondents whose influencer budget increased in 2023, 37% said the budget came from Social, 17% said the budget came from TV/ Radio, whilst 15.52% said the additional budget was transferred from their PR spend.

🔥36% say influencer content outperforms brand content (vs 11% which says it underperforms)

🔥Linquia asked brands and agencies where they are using their influencer content. 97% of respondents (up from 85% in 2021) are using influencer content outside of organic influencer posts, with paid social and brand organic social being the top channels (85% of respondents and 72% respectively).

METHODOLOGY: Linquia surveyed over 250 enterprise brand and agency marketers who are investing in influencer marketing in 2023.

What’s the ROI on that?

New study from Whalar shows creator content is a proven valuable media investment, delivering a 2.4x ROI within CPG.

Whalar commissioned Nielsen to analyse the impact of creator content across 20+ campaigns conducted in the US and UK within the CPG Personal Care category in an extensive Media Mix Model (MMM). The campaigns ran in 2021 and 2022.

KEY STATS

⚡️Creator content is a proven valuable media investment, delivering a 2.4x ROI for Whalar campaigns within the CPG Personal Care category - surpassing the performance of other media channels

⚡️Media impact and efficiency were the primary factors contributing to this ROI, highlighting creators’ cost-effectiveness and influence in driving sales

⚡️When combined with planned paid social media, Whalar creator content amplified the return on social investment by +14%

KEY INSIGHTS

Combining paid media with organic creator content significantly increases the visibility brands can achieve through additional placements in users’ feeds.

Evaluating different metrics like Click Through Rate (CTR), View Through Rate (VTR), and Engagement Rate (ER), and confirming Reach and Frequency (R/F), is the best way to measure creator content for sales impact.

Download Whalar’s study here 

The influencer dietitians leaving a bitter taste

Sometimes we need to know more than whether a creator’s content is an ad or not. Sometimes we need to know clearly who is sponsoring that content.

A recent example is the uptick in paid-for content which followed the World Health Organisation hazard guidance issued over the summer warning about over consumption of aspartame - the artificial sweetner.

Reels and TikToks from creators including Steph Grasso and Mary Ellen Phipps sought to play down WHO warnings over the sugar substitute. For example Grasso ends her TikTok saying that WHO should concentrate on making fruit and vegetables more accessible “rather than just using clickbait based on low-quality science”.

The captions of both creators’ content were marked #AD. However, neither disclosed they were paid by the lobbying group known as American Beverage, which represents the likes of Coca Cola and PepsiCo.

The story was unearthed through an investigation by The Washington Post and The Examination, a new nonprofit newsroom covering global health. Together they found that registered dietitians with large audiences on social media are frequently paid by food companies to promote diet soda, sugar and supplements on Instagram and TikTok.

WHY IT MATTERS

Gen Z and Millennials are more likely to discover new products and services via social media ads than they are to learn about them through search engines (GWI, Swipe, click, buy 12 Sept. 2023).

More broadly, half of us turns to influencers for mainstream news stories ahead of journalists across TikTok (55% vs 33%), Snapchat (55% vs 36%), and Instagram (52% vs 42%) - on YouTube the split is 45% vs 42%. This is according to The 2023 Reuters Institute Digital News Report.

The News Consumption in the UK 2022/23 report from Ofcom, UK's communications regulator, shows the majority (83%) of 16-24 year-olds consume news online. This is driven by use of social media for news (71%).

Online Safety Bill ready to become law - watch out for automatic takedowns of creator content

The Online Safety Bill has yesterday (Tuesday 19 September) passed its final Parliamentary debate and is now ready to become law.

Under the law social media platforms will be expected to:

• remove illegal content quickly or prevent it from appearing in the first place, including content promoting self-harm

• prevent children from accessing harmful and age-inappropriate content

• enforce age limits and age-checking measures

• ensure the risks and dangers posed to children on the largest social media platforms are more transparent, including by publishing risk assessments

• provide parents and children with clear and accessible ways to report problems online when they do arise

These are sensible expectations for social media platforms. Watch out though for the tsunami of creator complaints coming down the pike from creators up-in-arms about automatic takedowns of their content by Instagram and the others.

Creator Briefing #94 back in February discussed Meta verification’s programme. I said at the time: “Offering enhanced support is about getting creators ready for when platforms are required to take down more content under new regulations like the UK’s Online Safety Bill. When these rules kick in, there'll be a huge backlash from creators querying why their content was taken down, asking what the appeal process is, how long it'll take, who ultimately adjudicates, etc.”

FCA to oversee cryptoassets

The UK Government has legislated to bring cryptoassets within scope of the Financial Conduct Authority’s (FCA) financial promotion regime.

From 8 October 2023 there will be 4 routes to lawfully communicate cryptoasset promotions to UK consumers:

1. The promotion is communicated by an FCA authorised person.

2. The promotion is made by an unauthorised person but approved by an FCA authorised person.

3. The promotion is communicated by a cryptoasset business registered with the FCA under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs).

4. The promotion otherwise complies with the conditions of an exemption in the Financial Promotion Order.

This week on the Influencer Marketing Lab podcast …

This week on the podcast I'm in conversation with Esme Rice, Worldwide Influencer Practice Lead at Mindshare.

We talk about

• professionalisation of the industry

• Regional differences in the influencer marketing landscape

• Consumer behaviour towards virtual influencers in different parts of the world

• Near future of our channel

HOW TO LISTEN

You can always listen to this week's Influencer Marketing Lab podcast from the show notes on the website.

But if you want to subscribe for free to get every episode, here's how:

• If you're on an iPhone or iPad, just tap this link.

• If Android is your thing, you can find the Influencer Marketing Lab in the Google Podcasts app by tapping here.

• Or, if you enjoy listening to podcasts on Spotify you’ll find the Influencer Marketing Lab there, too. Tap away.

TikTok Shop US open for business

And, we’re off … TikTok Shop has finally arrived in the US as the short-form video entertainment platform seeks to drive e-commerce in the world’s largest economy.

Many TikTok creators will be banking the new feature to drive revenue their way through affiliate marketing deals especially as the app has “drawn up plans to bar links to outside e-commerce sites, such as Amazon, as part of an effort to force people to use TikTok Shop if they want to buy something they see on the app,” according to The Information (as reported in Creator Briefing #116).

WHAT’S UNDER THE BONNET?

TikTok Shop offers:

• In-Feed Video and LIVE Shopping: Shop tagged products directly from videos and LIVEs in the For You feed.

• Product Showcase: Browse product tiles, read reviews, and purchase directly from a favourite brand's profile. Businesses can curate custom product collections directly on their profile page.

• Shop Tab: Businesses display their products on a new product marketplace and customers can easily search and discover promotions. Product recommendations are showcased via product listings and shoppable content, and customers can manage orders, all within a single tab.

• Affiliate Program: Creators can connect with sellers through new commission-based product marketing opportunities. Creators have a new way to monetize their creativity by sharing products in short videos and livestreams, and sellers can choose the Affiliate plan that's the right fit for their brand.

GETTING LOGISTICS RIGHT

TikTok Shop in the US has learned lessons about logistics from regional tests in the past (notably in the UK). TikTok Shop will be served through a new logistics solution stores, picks, packs, and then ships sellers' products to customers.

Will TikTok have sufficient capacity to handle Black Friday and Christmas spikes?

Bloomberg reports that Amazon is ramping up its workforce and is set to “hire 250,000 employees this holiday shopping season and boost average pay for logistics personnel to about $20.50 an hour as it seeks to recruit and retain workers amid a labor shortage”.