Statistics show why influencer marketing is an excellent strategy for marketing products and services on social media.Influencer marketing is becoming increasingly relevant due to its effectiveness. Many companies have used influencer promotions to generate sales and promote their brand name.
Influencer marketing is now a 16.4 billion dollar industry and is expected to see even more growth in 2023. Statistics show the power of influencer marketing and why it's an excellent strategy for marketing products and services on social media.
Influencer marketing is an effective form of social media marketing. The estimated return on investment (ROI) of influencer promotions is about $5.78 per dollar spent. If you optimize your influencer marketing strategy, this ROI can increase even further. Lionize’s influencer marketing software can help by providing valuable insights on influencer marketing campaigns that lead to increased ROI and success of your influencer marketing efforts.
Influencers are still relevant in 2023. Billions of people worldwide are active social media users and regularly follow and engage with content from their favorite influencers. With such a high amount of social media use and popularity, it is expected that influencers and social media influencer marketing will be relevant and effective for years to come.
Social media influencer statistics show that influencer promotions help consumers make purchasing decisions and have the ability to influence consumers to buy. About 49% of consumers state that they use influencer recommendations to decide what to buy, and 80% of consumers have purchased something a social media influencer recommended.
Influencer marketing significantly impacts consumer behavior. Research has shown that an estimated 61% of consumers trust influencer recommendations. In addition, influencer brand promotions are nearly twice as influential on consumer purchasing decisions compared to social content from the brand itself.
The average conversion rate for influencer marketing is estimated to be about 2.55%. However, this number can be higher with an optimal influencer marketing strategy. To better understand how this conversion rate leads to a solid return on investment, the following example will show how you can make money from an influencer-promoted post.
Take an influencer who has 20,000 followers on Instagram. The average cost to promote through an influencer on Instagram is about $10 per 1,000 followers. For an influencer with 20,000 followers, a promoted post would be $200.
Now let's say the influencer’s promotional post gets a 4% engagement rate, meaning 800 of their followers engage with the post. You can then take the average conversion rate of 2.55% and find that about 20 conversions would result from this promotion (800 x 0.0255 = 20.4).
Finally, let’s say your profit from product sales is $60 per sale. This means you would make $1,200 in revenue from this promotion (20 sales x $60 profit per sale = $1,200). Since you initially spent $200 for the promoted post, your total net profit would be $1,000, resulting in an ROI of $5 per $1 spent ($1,000 total net profit ÷ $200 initial investment = $5), which is around the average ROI for influencer marketing.
A good conversion rate for influencer marketing would be anything that beats the average conversion rate of 2.55%. However, the conversion rate for influencer promotions can vary by industry. If you’re looking to set a goal for a good conversion rate, around 3% is a good number to try to achieve.
More companies are starting to use micro influencers for their influencer campaigns, and that isn’t expected to slow down in 2023. Micro influencer promotions are effective because small audiences tend to have more loyalty and engagement with content creators. While data on micro influencers is still being collected, studies have shown that micro influencer promotions have an estimated 20% higher conversion rate than macro influencers. This means that conversion rates for micro influencer promotions are around 3% or higher.
Lionize’s influencer marketing platform can help you get started with influencer marketing. Lionize helps you connect with the right influencers for your needs, provides automation options for parts of the influencer marketing process, and tracks valuable data about influencer promotions. Every step of the way, our artificial intelligence software will provide you with valuable insights that improve your influencer marketing campaigns. Contact us today to learn how Lionize can help you.