The influencer economy: Brands tap social media's vast reach for marketing

The first of a two-part series delves into the bigger picture of influencer economy

Mortal, GamerFleet, LolzZz, and Dobby — India’s largest gaming influencers challenged gamers to reach 125 finishes in 125 minutes while playing on Rooter, a gaming platform early this year. The three-hour event was live-streamed from Hero's Centre for Innovation and Technology in Jaipur.

 

The Rs 37,456 crore (revenues FY24) Hero MotoCorp is the world’s largest manufacturer of two-wheelers. The idea, executed by Publicis Play (a part of Publicis Groupe), was to gamify the launch of Hero Xtreme 125R by challenging players, who are also a large chunk of the bike’s target audience, to outperform its features.

 

“Influencer marketing is good old word of mouth, on steroids,” says Harikrishnan Pillai, co-founder and chief executive officer (CEO), TheSmallBigIdea, a digital marketing agency.

 

Across categories — ranging from consumer products and financial services to cars and education — influencers are emerging as a parallel media ecosystem.

 

The Advertising Standards Council of India defines an influencer as “someone who has access to an audience and the power to affect their purchasing decisions or opinions about a product, service, brand or experience, because of the influencer’s authority, knowledge, position, or relationship with their audience.”

 

Think of people making videos on anything from hair and clothes to food and manners that brands use to reach the people following them. 

 

Myntra has 2,000 influencers on its panel while Dabur collaborated with over 2,400 of them in 2023, say reports. UltraTech, GSK, Enamour, the list goes on. Social media usage has been going through the roof, globally. India has one of the highest social media penetration in the world (92.6 per cent), says a ComScore report.

 

Almost 523 million Indians online now spend about 22 hours a month browsing through Instagram, YouTube, Facebook and other apps.

 

Of all the things they watch on these, “Media and entertainment content is the top driver of engagement (39 per cent) followed by influencer content (27 per cent),” says Atul Nandoskar, sales director, Comscore India.

 

This then is the media on which marketers are trying to reach their consumers.

 

“The consumer journey towards a product is no longer linear. It is a mishmash of entry points ranging from digital, television, shorts and audio. It needs different channels,” says Oindrila Roy, managing director, Publicis India. 

 

She reckons that spends on influencer marketing would be about 10-12 per cent of overall digital advertising spends which were at Rs 57,600 crore in 2023. That means brands spent over Rs 5,700 crore to get influencers to push or sell their products.

 

 “The creators have been around since 2015-16. The shift really happened during the pandemic when no fresh content (films, TV shows or series) was being created. That is when influencers started being used as a media vehicle,” thinks Roy.

 

The players

 

There are anywhere from 3.5-5 million influencers in India, going by estimates. The Comscore report lists Salman Khan, Sara Ali Khan and Ram Charan as the top three influencers in India across Instagram, Facebook and X in September 2024. But typically “Influencers are internet celebrities; you will never have an influencer who has a larger than life aura,” says Gandhi.

 

Some of the top ones - Ashish Chanchlani, Bhuvan Bam, Kusha Kapila or Viraj Ghelani — are mega influencers with over a million followers. They charge anywhere from Rs 1 lakh to Rs 25 lakh for making a reel and posting it on their social media handles.

 

“They are not just spreading a message, there is engagement,” says Roy.

 

Engagement — defined by likes, reposts, comments and shares — is key. For instance, Bhuvan Bam has 19.3 million followers on Instagram; but they engaged with his work only 3.2 million times in June 2024. In the same period, comic The Rebel Kid (Apoorva Makhija) had just 1.5 million followers on Instagram who engaged with her videos 5.2 million times.

 

“More than 50 per cent influencers (on Instagram) have over 60 per cent inactive or non-credible followers,” points out Kalyan Kumar, co-founder and CEO of KlugKlug, an influencer marketing platform. Its database of 470 million influencers from across the world is mined for insights that guide over 170 clients such as GroupM and ITC.

 

“Over half the audience for 91 per cent of female influencers in India (Instagram) are male. That means a typical female-led brand is talking to 70 per cent male audience if it uses the same pool of influencers,” says Kumar. Just correcting a campaign for these basics could improve efficacy by 30-40 per cent, he reckons.

 

How does that work? That is a story for tomorrow.