The Rise of the Influencer: How More Competition Affects Income Streams | by MyPeople | Jun, 2023

1. Influencer Boom: Understanding the Numbers
— According to a study by InfluencerDB, the number of Instagram influencers with over 15,000 followers increased by 33.3% in 2020 alone.
— Social media analytics platform HypeAuditor reported that the number of influencers with 100,000 or more followers doubled from 2019 to 2020.

2. Oversaturation and Diminishing Engagement
— As the influencer community expands, audiences are exposed to a larger volume of content. This oversaturation can lead to diminished engagement rates, making it harder for influencers to reach their target audience effectively.
— Research by Trust Insights indicates a consistent decline in average Instagram engagement rates across different follower tiers, further highlighting the challenge of standing out in a crowded space.

3. Influencer Marketing Budgets and the “Micro-Influencer” Trend
— Due to the influx of influencers, brands are adjusting their influencer marketing budgets and strategies. Instead of focusing solely on influencers with massive followings, many brands are turning to micro-influencers — individuals with smaller but highly engaged audiences.
— This shift allows brands to maximize their marketing ROI by reaching niche demographics and fostering more genuine connections with their target consumers.

4. Diversifying Income Streams and Niche Specialization
— Influencers need to adapt and diversify their income streams to mitigate the impact of increased competition. Relying solely on brand collaborations and sponsored posts may no longer be sufficient.
— Niche specialization can provide a competitive edge. By focusing on a specific interest, expertise, or demographic, influencers can attract a dedicated and engaged audience, making them more appealing to brands seeking targeted reach.

5. Leveraging Multiple Platforms and Formats
— Instagram is no longer the only player in town. Influencers are expanding their presence to other platforms such as TikTok, YouTube, and podcasts. Utilizing multiple platforms helps broaden their reach and increases opportunities for collaboration and monetization.
— Embracing different content formats, such as video, live streaming, or interactive elements, can also boost engagement and captivate audiences in a saturated market.