Industry Expert Insight: Instagram Followers Are The New Currency
A few years ago when Instagram was on the rise, one particular meme was trending.
“Being famous on Instagram is like being rich in Monopoly. It’s not real,” it read. It was shared across a variety of profiles, both by up-and-coming social media stars and (more often than not) those who would remain forever unknown.
Fast forward to today. Almost everyone who is active on the platform (which has an active user base of 1 Billion in 2019 with 71% of those being under the age of 35) – whether it’s a brand or an individual – wants to either be (or be tagged, or featured or work with or hire) someone who is Insta-famous. In 2019, this meme no longer holds true.
Whatever one’s personal feelings on social media, it can’t be denied that a substantial following in today’s day and age is currency. With borders opening up and free trade being conducted more frequently than ever before, the old ways of doing business back from a few decades ago no longer hold true.
An individual no longer needs to build a cosmetic manufacturing lab if they want to get into the beauty industry. Today, products can be bought and private labeled via wholesale websites, like Aliexpress, without the brand owner ever even having to meet their supplier face-to-face.
The brand owner in many businesses, especially in the various offshoots of fashion and beauty, has to only worry about one aspect: Who do I sell to? And that’s when a built-in fan base on social media is worth its weight in gold.
A lot of brands turn to the darlings of social media, now known as ‘influencers’, and look to them to promote their products. A favorable word put in by an influencer can sell out products overnight, including those that had been sitting on shelves, available freely for years prior.
High end couture houses like Dior use influencers rampantly to sell their brand and to be able to reach a younger audience, who are perhaps yet unable to separate their devotion for an influencer and what they perceive is their taste, from an ad on a billboard.
Worldwide, governments are trying to put in guidelines where people are required to disclose whether a post is an ad or the product is gifted, but is yet to be implemented fully. For a brand these options are a lot more cost effective than hiring a movie star (for now) and taking up space on a billboard rather than occupying free real estate on a digital screen.
While previously a small startup that targeted a specific audience, like those following a vegan diet for example, may have been unable to afford ad space in health magazines or could have gotten lost in the noise if they did, trying to grow their business today and working smartly with influencers can be hugely profitable.
Now there are countless Instagram accounts that cater to these niches, and a company could tie up with them to sell their products and encourage a personalized discount code to be given to their audience. This brings about a win-win for all.
Followers get to avail a discount, the influencer makes a variable amount that is linked directly to sales and, given that it is an affiliate program, the brand is able to monitor the usefulness of using one influencer over another while making money and spreading awareness of their brand.
For smaller influencers (also known as micro-influencers) there is also a rate card per post that is directly linked to the number of followers they have. This of course varies based on how much competition they have in their segment, but generally speaking, it is a direct correlation to follower numbers. This is hard cash we’re talking about, not Monopoly money.
Anywhere there is real money involved, of course there will also be real frauds, and for an average influencer to cheat the system and buy followers is as easy as clicking a button, with hilariously, a rate card also being attached to the number of followers they would like to buy.
With the publication “The Business of Fashion” reporting that marketers will spend $10 Billion next year on working with influencers, I don’t see that slowing down anytime soon.
Today even for public figures like published authors, CEO’s of businesses or even socialites, it is no longer enough to be well reputed in the your social circle when social media has made the world your stage for you to build your image. And that is when being famous on Instagram is, contrary to what the meme would suggest, very, very real.
What are your thoughts? Let us know in the comments below.
Written by Kiran Chhabria.
Kiran Chhabria is Director and Shareholder at Jumbo Electronics Co. Ltd. that is headquartered in the UAE. She is also a writer and has previously had columns in both Khaleej Times and Gulf News and has also published her first novel, “Kitty in the City,” in 2015. You can follow her on Instagram @howshespendsit