Let’s be real: traditional digital ads are losing their spark. People are scrolling right past those display ads and hitting “skip” faster than ever. Meanwhile, influencer marketing is taking off! Why? Because people trust real voices – especially those they follow on Instagram, TikTok or YouTube.
With Gen Z turning to TikTok as their go-to search engine (sorry, Google) it’s clear that engaging with influencers is the way to go.
Influencer advertising spend has increased significantly over the last few years and is set to hit US$35.09 billion in 2024, so it’s not surprising that many brands are moving their budgets away from display ads and pouring it into influencers who create authentic, engaging content that drives sales.
And why not? With some affiliate partnerships, you only pay for actual sales generated. That’s a win-win.
According to Influencer Marketing Hub, brands are raking in an average of $5.78 for every $1 spent on influencer marketing, while Google Ads only bring in about $2 for the same dollar spend. That’s a pretty big difference!
Beauty brands are reaping the biggest rewards, with Aggero reporting they can see returns as high as $11 for every $1 spent on influencers – sometimes even soaring to $18! Given that beauty and fashion brands are among the most popular in the influencer scene (Influencer Marketing Hub), it makes sense they’re cashing in big time.
Influencers vs Digital Ads vs Display Ads
The rise of influencer marketing isn’t just a trend – it’s reshaping how brands connect with their audience and beauty brands are leading the charge by dedicating hefty portions of their budgets to influencers. But there’s no “one-size-fits-all” approach.
Take Glossier, for example. The beauty brand sometimes pours more than 30% of its marketing budget into influencer collaborations, thanks to the high ROI and engagement rates they get in return. Meanwhile, companies like Apple prioritise digital ads (around 50% of their budget) but still mix in influencers during product launches for maximum buzz.
Then there’s Gymshark, a fitness brand that found the sweet spot by dedicating 25% of its budget to influencer marketing while spending 50% on digital ads. This hybrid approach gives them broad reach and high engagement among fitness enthusiasts.
Good news though, working with influencers doesn’t have to break the bank. In fact, 68.3 percent of brands spent under $50,000 annually on influencer marketing. Why? Many opt for smaller, niche influencers who bring authenticity to the table (HubSpot 2024 Social Media Marketing Report).
Choosing a platform over an agency can also be a smart move to keep costs down. Platforms streamline the influencer collaboration process, cutting out hefty agency fees while still delivering high-quality partnerships.
Influencer marketing is also earning its spot in standalone content budgets. Nearly two-thirds (65.8%) of brands have carved out a dedicated budget just for this channel, according to the 2024: Benchmark Report.
So, How Should You Split Your Budget?
- Influencer Marketing: Most businesses allocate 10% to 30% of their total marketing budget to influencer campaigns. Beauty and fashion industries tend to skew higher, where influencer endorsements drive sales like nothing else.
- Digital Ads: This chunk usually takes up 40% to 60% of the budget and covers everything from Google to Instagram ads. It’s essential for fast reach, but influencers can offer a deeper connection.
- Display Ads: These typically get around 10% to 20% of the budget. They’re great for building brand awareness but tend to be less engaging than influencer marketing and targeted digital ads.
In short, the mix depends on your industry and goals, but one thing’s clear – there’s no skipping influencers in 2024 if you want to stay ahead of the game!
Level Up our ROI with AI-Powered Influencer Marketing
At this point, you might be thinking: “This all sounds great, but how do I actually implement this?” That’s where AtisfyReach comes in! Our platform is designed to maximise your ROI through AI-powered influencer selection and smart budget allocation.
No more tossing money at random influencers and crossing your fingers! With AtisfyReach, you’ll find influencers perfectly aligned with your brand and target audience.
Here’s how we help you crush your goals:
- Smart Budget Allocation: Our AI analyses engagement rates, reach, demographics, and a wealth of other historical data to allocate your budget where it’ll deliver the best ROI.
- Real-Time Performance Tracking: Keep an eye on your campaign’s success as it unfolds, and tweak things on the go for maximum impact.
Influencer marketing is here to stay, and as more companies shift their budgets to influencers, the returns are only going to get better.
No matter your industry – whether it’s beauty, fashion, gaming, tech, or beyond – the right influencer can have a huge impact on your bottom line, turning followers into loyal customers.
Ready to level up your strategy? Book a demo here and see how we can help you boost your influencer marketing game.