The influencer marketing industry was apprehensive about the pandemic’s potential impact on creators and brands. After nearly two years, it emerged stronger than ever, and brands worldwide spent around $15 billion on influencer marketing in 2022.
A closer look at the year 2022
Influencer marketing, formerly considered a gimmick, is rapidly becoming an essential tool in a brand’s marketing portfolio. Influencer marketing has been used in 93% of marketing campaigns and is now considered an important advertising strategy. Recent estimates of Indian spending prove how influencer marketing has developed into a more mainstream approach for modern brands. The Indian influencer marketing industry stands at a value of Rs 1,275 crores in 2022.
Niche micro-influencers are becoming more popular since they use a personalised approach and have strong connections with their target audience. According to a survey, approximately 22% of consumers aged 18-34 years rely on influencers for product endorsements/recommendations as they gain social validation and decision-making power. This pay-for-performance approach has enabled millions of consumers to make more informed purchase decisions daily. Brands leverage this channel to build their own marketing ecosystem.
The influencer marketing industry has evolved into a global necessity for every brand aiming for long-term success. The market is estimated to grow at a CAGR of 25% through 2026, reaching worth Rs 2,800 crores. This surge could be attributed to the growing popularity of short video formats on platforms such as Instagram, Facebook, YouTube, and other short-format video outlets. It has spurred social media consumption and the optimisation of data collection, which brands use for social media marketing. Today, India has over 467 million active social media users who spend an average of 2.36 hours daily on social media.
Influencer marketing trends that accelerated brand building
Influencer marketing has experienced a few significant shifts in consumer perception regarding the entire marketing and influencer segment and platform monetisation. With increased social media consumption and engagement, D2C brands across all industries have turned to influencer marketing.
One of the trends that stood out this year was influencers building and launching their own brands, propelled by their expertise in a certain area, passion or life experience. Consumer behaviour shifts driven by the pandemic have accelerated trends along with the D2C and e-commerce industries. We’ve also witnessed a rise in social commerce, which is likely to continue. Platforms like Facebook, Instagram, YouTube and Twitter have already made such shopping features available in various regions worldwide. By 2025, social commerce is expected to account for 17% of all e-commerce spending.
Influencer marketing helped brands reach a larger audience and improve search engine optimisation while establishing brand recognition and boosting organic traffic. It also helped brands attract more customers by raising awareness and yielding a higher ROI than conventional marketing strategies. As more brands (about 61.2%) realise the exceptional ROI provided by influencer marketing, they are increasing their investments in this space. Long-term collaborations with influencers have emerged as a prominent trend, allowing brands to cultivate advocates and boost audience trust.
Additionally, influencer marketing has enabled brands to generate tailored content and share it with their target audience through influencers. It helped brands drive sales and conversions since influencers significantly impact consumers’ purchasing decisions (particularly millennials and GenZ). Influencers effectively incorporate marketing campaigns in their own unique and creative style and lexicon, resulting in greater brand recognition and credibility.
As we approach 2023, more trends will witness a spike, and existing trends will continue to grow alongside brand demand.
With the advent of social media, influencer marketing is gaining prominence as more D2C brands across sectors are increasingly relying on it. It is also paving the way for social commerce and the creator economy. Brands are making long-term collaborations as the audience’s trust and engagement have accelerated with influencers.
All of this results in outstanding lead generation and exposure to a pool of prospective buyers for brands. Influencer marketing is not only here to stay in India but will continue to evolve. With a strong start-up economy and big brands seeking to reach their target demographic, India’s influencer marketing has a bright future brimming with opportunities for businesses to innovate and get into action.
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