Influencer marketing & impact on business

Abstract

India has 658 million people who use the internet, second only to China which has 1 billion internet users (Statista, 2022). Of all the social media platforms used by the internet users in India, WhatsApp remains the most popular with 530 million users, followed by YouTube (448 million), Facebook (410 million), Instagram (210 million), and Twitter (17.5 million) (Basuroy, 2022). With such a large user base, it is no surprise that social media has become a powerful tool for marketing, especially when it comes to targeting the younger population. In fact, as per a 2020 survey carried out by Statista’s research department among marketing leaders from 29 countries, 83% of respondents stated social media as a digital channel for marketing initiatives of their companies. Social media marketing provides higher brand recognition, community building for a product/service offering, repeated exposure, snowball effect with influence, and so on (Chandler, 2013). With an increased focus on creating personal connections with the users, brands have turned to social media “influencers” who create personalized social media content for brands thereby leveraging their online fan following to advertise products or services to a large audience online. Moreover, consumers increasingly use online sources to research more about their products of interest before making their purchase decisions. With such trends, social media influencers have become even more influential with their fans. With tens of thousands to millions of followers, influencers are now on par with traditional celebrities like cricketers and actors with a predominant group of followers. The social media advertising segment is estimated to reach $226 bn in 2022 (Statista, 2022). Of this, influencer marketing is estimated to have a share of $16 bn (Qoruz, 2022). According to Qoruz’s data, an average influencer with over half a million followers can charge between $1300 and $8000 for a promotion. With such investments and rapid growth of the social media user base and the segment of influencer marketing, it is important to ensure that the right influencers are selected by a brand and to understand what makes an influencer marketing campaign successful.