Several influencers experienced a decline in paid work as the recession hit in mid summer of this year. One of those creators is micro influencer Austen Tosone. “I was anticipating the holiday season to be really big for me,” Tosone said. “But I found that the offers weren’t coming in to the degree that I expected them to.” Tosone, who has 13,000 Instagram followers, left her job to become a full-time content creator in April 2021.
Brand deals have been the biggest income driver for Tosone from April 2021 to summer 2022 but then everything changed. Tosone said platform incentives (like Instagram’s bonus program) will overtake brand deals. “I’m not surprised to see fewer offers and I’m grateful that I’ve pivoted to accommodate that so that I am not scrambling right now,” Tosone said.
To boost her income, she’s turning to courses and memberships — and also plans to keep a closer eye on her expenses through the end of this year to save more, like cancelling subscriptions to services she doesn’t regularly use. The main thread of this story is that some creators are having to pivot the work they do in order to continue monetising through a recession.
This past quarter of the year has seen some creators say they had seen fewer companies reach out for branded content deals than they had expected, though others said they’d still seen high demand as the holiday season has ramped up.
“Influencer marketing certainly isn’t immune to a potential budget pullback,” Insider Intelligence analyst Jasmine Enberg said on a recent “Behind the Numbers: The Daily” podcast. “But what we’ve seen so far is that it has been more resilient than other types of digital marketing, and brands have continued to spend on their partnerships, particularly with long-term creator partners, throughout this volatile economic environment.” Insider Intelligence forecasts companies will spend $6.16 billion on influencer marketing in 2023, up from 5 billion this year. I do expect that there will be brands that will tighten their budgets even further, but for now, it’s among one of the better-growing digital marketing tactics,” Enberg added.
At the end of the day, creators are people and can be comprehensive of budget changes due to a tight economy but only if transparency is exchanged within the brand to influencer relationships. “We are being very straightforward with all of our creators and letting them know the strategies that worked years ago — in terms of just posting whenever — it’s not like that anymore,” said Pamela Zapata, CEO of talent management firm Society18. “The space is supersaturated.”
Byron Ashley, the CEO of talent management firm Settebello Entertainment, said there was a moment this summer when his creators’ rates were at an all-time high. But Ashley said he warned his team not to expect the boom to be a sign of a new normal.
“I’m operating as if we are going to be in a pretty deep recession, and preparing and thinking of alternatives for all of my clients to make sure that their businesses stay as on-track as possible,” Ashley said.
Perhaps the market will focus on a quality over quantity apoproach when it comes to monetised content as an economic downturn may mean advertisers will become pickier about who they sponsor. “The flood of creators who started over the past few years will begin to dry up some as people who entered expecting to get rich and famous quick end up realizing that it isn’t as easy as it looked,” said TikTok creator @speechprof, who prefers to go by his online moniker Professor Chesk.
Furthermore, when it comes to getting ahead of an economic downturn, Ashley sees this as an opportunity for creators to establish long-term deals to work with certain brands on a recurring basis. “We turned to a lot of brands that work with our clients on a semi-recurring basis and tried to formalise those as long-term ongoing partnerships,” Ashley said. “Even if there was a bit of discount we wanted to lock in rates and know that our clients would be working through the winter.”