How Social Media Influencers Make Money

Exploring the ins and outs of influence marketing and understanding what benefits it can provide a business requires you to not only look at the return on investment for a business themselves but also the vested interest of the influencer themselves.

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Exploring the ins and outs of influence marketing and understanding what benefits it can provide a business requires you to not only look at the return on investment for a business themselves but also the vested interest of the influencer themselves.

When the uninitiated first learn about influencers and influencer marketing, especially on the nano-influencer level, they can sometimes struggle with the basic notion of how people make money posting on social media and how ‘influence’ works as a marketing tool.

The idea of influencers is nothing new, with celebrity endorsements arguably dating back to theatres claiming an endorsement from royalty or Wedgwood using their support from 18th-century royalty to promote themselves.

Social media influence works like this but on a smaller scale, cultivating a group of followers by building a brand they are interested in and creating a community around themselves, their brand and their shared interests.

Once they reach a certain level, they can proceed to monetise this influence in several ways.

Advertising Revenue

Certain social media platforms such as Youtube provide ways for influencers to make money by making video content with advertising enabled. For everyone who views the advert or clicks on the link, the influencer makes money.

Until several incidents in the 2010s led to Youtube changing their monetisation policy, this was the primary way influencers made money.

Sponsored Content

Usually taking the form of posts with either the phrase “#ad” or some variation thereof to meet advertising guidelines and terms of service rules, influencers are paid to promote products to their audience.

Typically these work best through a direct discussion with the influencer themselves, to ensure that they are the best fit to advertise the product and can provide an authentic sponsorship opportunity that their audience will be interested in.

Affiliate Marketing

A more basic version of sponsored content that allows for more direct compensation and a return on the investment.

An influencer recommends a website, service or product and if someone makes a purchase using their affiliate link, they receive financial compensation.

This often takes the form of a discount code, as the combination of a personalised recommendation as well as a financial saving is enough to convince many people to make a purchase.

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