Does everyone want to be an influencer now?

“Whatever stone you pick up” there is an influencer underneath. About 200 social media stars attended the Democratic National Convention in August, enjoying lavish parties and cruises. Some even got to chat with Kamala Harris. Donald Trump has also interviewed influencer bros like Logan Paul and Theo Von in an effort to get their followers to vote for him.

Influencer marketing is now a given for big companies

Politicians aren’t the only ones who have spotted the ever-increasing influence of social media stars. In the last five years, American companies have almost tripled the amount of marketing expenses they allocate annually to influencers. According to eMarketer, a research firm, the figure rose to $7 billion. The so-called “influencer marketing‘, is part of any big, self-respecting company in the modern age, said Mark Read, head of WPP, which owns advertising agencies such as Ogilvy and Mindshare. Retail giant Walmart has partnered with TikTok stars Charli and Dixie D’Amelio. Louis Vuitton, a luxury brand, has done campaigns with Emma Chamberlain, a YouTuber.

OR Goldman Sachsestimates that as of last year there were more than 50 million influencers worldwidefrom fashionistas on Instagram and comedians on TikTok to gamers on YouTube. He estimates that their ranks swell between 10% and 20% annually. Some influencers they see work as a hobby. Others aspire to make it their profession, lured by stories of superstars making tens of thousands of dollars for a post and exploiting their legions of followers to launch their own brands. The 57% of Gen Zs in America would like to be a social media influencer, according to Morning Consult, a researcher. 53% describe it as a “reliable career choice”.

Faced with too many options, brands have turned their attention to influencers who create content for narrower audiences, such as those who give fashion advice to the over-60s. Thus, companies attract more targeted consumers. For companies, the influencer economy is more attractive than ever. However, those who dream of making a living as influencers should be prepared to face many disappointments.

3/4 of Gen Zs rely on influencers for what they will buy

Influencers—or “content creators,” as many prefer to be called—have become an integral part of how consumers shop. According to research by Northwestern University and ltk, a platform that connects influencers with brands, nearly 3/4 of Gen Zs in America rely on influencers to help them choose which products to buy. The same is the case with 1/3 of people who are boomers (born 1964 and earlier) or older.

Meanwhile, influencers who became famous on social media have now become models, actors and entrepreneurs. Cloudy Zakrocki, who made the transition from fashion journalist to influencer nearly a decade ago, says social media stars used to get a free pair of shoes or an invitation to an exclusive event. Nothing else.

Khaby Lame, a comedian with more followers than anyone else on TikTok, has collaborated with Boss, a clothing brand, for a collection. Fashion influencers like Jeanne Damas and Aimee Song have launched their own clothing lines. In recent years, influencers have starred in Super Bowl ads alongside Hollywood royalty and chart-topping pop stars. The bigger ones now hire staff to help them create impressive posts, while agencies and other intermediaries help them attract and manage brand deals.

However, even as social media stars become much more famous, staying “relevant” is difficult. Notably, as of 2021, the amount of influencer marketing spend in America received by content creators with more than 100,000 followers has dropped from 47% to 30%. In contrast, the amount received by those with fewer than 20,000 followers has increased from 20% to 45%. The celebrity influencers they are useful for companies that want to increase their brand awareness or change the way it is perceived by buyers. But when it comes to getting people to buy their products, companies are increasingly interested in influencers with a small but dedicated group of followers. Marketing firms help them manage many such contracts, sometimes using artificial intelligence (AI) to identify influencers whose audiences best suit their needs.

In research by the Influencer Marketing Hub, another research group, the 86% of brands worldwide said they plan to spend on influencer marketing this year, up from 37% in 2017, when the survey was first conducted. Almost 1/4 plan to spend more than 40% of their marketing budget on campaigns with an influencer.

Did we fill up with influencers?

However, for those hoping to make a career out of their social media presence, the proliferation of influencers should be cause for concern. Only 4% of influencers earn $100,000 a year or more from their work, according to Goldman Sachs. AI could make matters worse as “virtual influencers” begin to crowd social media: Aitana López, a gamer and fitness guru with pink hair and a face so symmetrical it could only have been created by a computer, has 330,000 followers on Instagram.

Focusing on building a small fan base in a niche area can be a way for hobbyists to make extra money, but it will rarely be enough to quit their job. Additionally, the plethora of influencers has made online reputation more volatile. Even if a post goes viral, it doesn’t mean an influencer’s career is set, says Joe Gagliese, co-founder of Viral Nation, a digital marketing firm. “If they’re not careful to make the most of it, there’s another creator right behind them“, he says. “This industry is extremely volatile,” points out Vanessa Chen, a fashion influencer better known by her Instagram name Vivacious Honey.

There’s another problem with the influencer boom: the consumers are getting tired from all those ads masquerading as entertainment. In a survey last year McKinsey, a consulting firm, found that 68% of global fashion consumers were dissatisfied with the amount of content being contributed to social media. Influencers initially took off because consumers saw them as “people they could trust,” says McKinsey’s Anita Balchandani. To maintain their influence, they have to strike a balance between getting paid and convincing their followers that they’re still “authentic,” one of the industry’s favorite buzzwords. Being popular, it seems, is harder than ever.