The Instagram influencer market reached $5.24 billion in 2019, and despite COVID-19 it will not fall below $5B in 2020 [CHART]

Nick Baklanov

Marketing specialist at HypeAuditor. Connect on Linkedin.

Instagram was launched in 2010 and rapidly gained popularity. With its 1 billion monthly active users Instagram has become not only one of the leading social networks but also the most strategically important platform for Influencer Marketing.

In 2019, Nearly 90% of all influencer campaigns included Instagram as part of the marketing mix— higher than any other social media channel in the industry.

Thanks to Instagram’s consistent popularity, a wide range of Instagram influencer tier and categories options, and the simplicity of sponsoring Instagram content, Instagram has definitely moved influencer marketing into the mainstream.

Instagram influencer market reached $5.24 billion in 2019

During 2019, influencer marketing spent on Instagram influencers increased by 22% and reached $479M in December.

Instagram influencer market reached $5.24 billion in 2019

To estimate the market size in 2019 we’ve analyzed over 3M posts that were marked as sponsored. A “sponsored post” is an influencer’s post with brand mentions that was posted on a paid or a barter basis when an influencer receives a product or services from a brand in return for publication.

The number of Instagram Stories’ daily active users (DAU) currently sits at 500 million. This number has been continuously rising since 2016, when Instagram first launched the “Stories” format. Advertisers also included stories in their influencer marketing strategy and the number of integrations in Stories is growing month after month.

Our estimations show that 47.18% of sponsored integrations occur for Stories. And their share is growing every month.

Instagram influencer market reached $5.24 billion in 2019

The impact of COVID-19 on influencer marketing

Influencer Marketing has been markedly impacted by the COVID-19 pandemic and, like many other industries facing a period of unprecedented uncertainty. The final impact will depend on the duration and efficacy of shelter-in-place orders, the effectiveness of economic stimuli around the world, and other economic factors.

Many businesses experienced a significant reduction in demand, thus they have become more modest with their advertisement budgeting. According to the survey made by Influencer Marketing Hub, 69% of brands expect they will decrease AD spending in 2020.

We compared the money spent on sponsored posts and stories in the first quarter of 2019 and the first quarter of 2020 and we can see that Influencer Marketing didn’t suffer as much as other industries. Rather, one can even say that it didn’t take a fall, but there was a reduction in growth.

Instagram influencer market reached $5.24 billion in 2019

The market size in the first quarter of 2019 was approximately $1185M and in 2020 this figure rose by 3.9% to $1232M

The largest budget cuts occurred in March. If we compare March 2019 to March 2020, we will see that market size was reduced by $16M (-3.8%)

COVID-19 made its adjustments and slowed down the growth of the industry but Influencer Marketing didn’t suffer as much as other industries.

In a time of disaster, people rely more on social services. We are seeing surges in traffic, especially in areas most affected,” Mark Zuckerberg said during a conference call. “People want to stay connected while being asked to maintain social distancing and eliminate loneliness.

The use of social networks is growing, and therefore the amount of advertising money that is being redirected from offline to online is also growing.

Based on the comparison between money spent on sponsored posts and stories in the first quarter of 2019 and the first quarter of 2020 we estimate that the Instagram Influencer Marketing market size will be from $5 billion to $6.5 billion in 2020.

Brands and advertisers are searching for the most effective ways to share their message to the masses online. As one of the few viable ways advertisers can connect with audiences online influencer marketing will continue to grow.

The Methodology behind the Research

To estimate the market size in 2019 we’ve analyzed over 3M posts that were marked as sponsored. A “sponsored post” is an influencer’s post with brand mentions that was posted on a paid or a barter basis when an influencer receives a product or services from a brand in return for publication.

To detect if a post is sponsored, we used Instagram’s Paid Partnership Feature, tracked the most common sponsor hashtags and used machine learning algorithms.

  • Paid Partnership. Posts marked using Instagram’s Paid Partnership Feature are counted as sponsored.
  • Common sponsor hashtags. Many influencers disclose an Instagram sponsored post by placing #sponsored or #ad hashtags in their captions. This method is fully compliant with FTC and CMA guidelines, thus at HypeAuditor, we analyze these posts as sponsored too.
  • Machine learning. Since not all influencers properly disclose whether a post is sponsored, and only a few countries have a disclosure policy, we use a machine learning-based approach that can find out if a certain post is sponsored or not.  

These include:

  • Ambiguous disclosures like #thanks, #collab, #sp, #spon, #partner, #ambassador, etc.
  • All types of disclosure in other languages, e.g. #sponsorisé, #produitoffert, #partnerschaft, #kooperation, #partenariat, etc.
  • Non-hashtag disclosure, e.g. “Thanks to @brand for sponsoring”, “Shoutout to @brand for gifting me this awesome makeup palette.”, etc.

There is also a growing trend of influencers who post fake sponsored content in order to increase credibility and attract sponsorships from other brands.

The exact amount of sponsored posts within the Instagram influencer market remains difficult to quantify, but our calculation methodology is the most complete of those that are now on the market.

To estimate expenditures, we used data that includes: influencer country, number of followers, engagement rate, and overall audience quality. Then we define the price of a sponsored Post and Story, using machine learning algorithms trained on market values.


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About HypeAuditor

This report was made by HypeAuditor

HypeAuditor is an AI-powered Instagram and Youtube analytics tool that helps to get insights about the creator’s audience, increase advertisers’ ROI and safeguard authenticity in influencer marketing. It sets a standard for influencer analytics by providing the most accurate data.

HypeAuditor applies machine learning to determine behavioral patterns and identify fake followers and engagement on influencer accounts. It presents users with a breakdown of demographic data for an influencer’s audience and brings benchmarks for each metric for influencers with a similar number of followers.