The economics of the influencer industry, and its pitfalls : Planet Money When you were little, what did you want to be when you grew up? An astronaut, a doctor or maybe a famous athlete? Today one of the most popular responses to that question is influencer – content creators who grow their following on Tik Tok, Instagram and YouTube and monetize that content to make it their full-time job.

In a lot of ways influencing can seem like the dream job - the filters, the followers, the free stuff. But on the internet, rarely is anything as it appears. From hate comments and sneaky contracts to prejudice and discrimination, influencers face a number of hurdles in their chosen careers.

This week we're bringing you two stories from our daily show The Indicator on the promise and perils of the multi-billion dollar influencer industry.

This episode was produced by Corey Bridges and Janet Lee. It was engineered by Robert Rodriguez and Katherine Silva. It was fact-checked by Sierra Juarez and Dylan Sloan. Emily Kinslow was the podcast coordinator for this series. Viet Le is The Indicator's senior producer. Kate Concannon edits the show. Our acting executive producer is Jess Jiang.

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The economics of the influencer industry, and its pitfalls

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Hey, guys. Welcome back to my channel. This is PLANET MONEY, and today we are going to be...


Wailin, what are you doing? This is - that's not our normal intro.

WONG: Oh, sorry, Adrian. OK, I'm going to start over. Get ready with me as I host PLANET MONEY from NPR.

MA: OK, Wailin, what has gotten into you?

WONG: You know, I've been watching all these YouTube videos and Instagram reels and TikToks. I think I'm starting to talk like a professional influencer.

MA: Ah, OK. Well, that makes sense because over on The Indicator, we've been doing this deep dive into the world of influencers. Hello, and welcome to PLANET MONEY. I'm Adrian Ma.

WONG: And I'm Wailin Wong. Influencers are a multi-billion dollar industry. And on today's show, we're bringing you two episodes from the Indicator's recent series on this rising industry. First, Darian Woods and I look into the reality of trying to make money in this business, and Darian gets a fashion influencer makeover.

MA: Then we look at the potential downsides of a career in influencing.

WONG: That's coming up after our #adbreak.


KENDALL HOYT: I think you need to lose the hat.


HOYT: Let your hair flow.

WOODS: All right. So, Wailin, Kendall Hoyt is a fashion influencer. She's got a focus on goth-adjacent vintage looks - half a million followers on TikTok.

WONG: Goth-adjacent vintage. I am intrigued.

WOODS: And to investigate the economics of influencers, I wanted to see how they spent and earned their money.

So here we are in Beacon's Closet.

So Kendall and I went to a secondhand clothes store in Brooklyn, and she offered to style me.

WONG: I am so jealous you got to go vintage shopping with an influencer, Darian

WOODS: It was a lot of fun.

HOYT: OK, I like the vibes of this - fun horse girl graphic (laughter).

WOODS: I love it.

So first was the T-shirt rack.

HOYT: Living her fantasy. She's free-spirited.

WOODS: Living her horse life.

HOYT: Yeah.

WONG: Please tell me you got the horse T-shirt.

WOODS: I did, of course. And next in my journey to learn about becoming an influencer - pants.

HOYT: I want to find, like, a '70s, like, flair or, like, a straight leg.

WOODS: It's time to ditch the skinny jeans.

HOYT: Ditch the skinny jeans. These look nice. Flares - it's flared.

WOODS: OK, flared blue jeans.

So I tried them on.

HOYT: You look good.

WOODS: Well, let's take this to the register. I'm going to...

HOYT: Are you serious?

WOODS: I'm ready to purchase.

HOYT: OK, great.

WONG: Wow. So you got a whole new outfit?

WOODS: That's right. And it was pretty affordable.

UNIDENTIFIED PERSON: All right, 33.90 is going to be your total for the both things. Whenever you are ready, just go ahead and tap. Do you want a receipt?

WOODS: A receipt would be great.


HOYT: I hope you're expensing that.

WOODS: Kendall makes short videos on TikTok and Instagram where she dresses in different outfits, mostly thrifted or secondhand.


HOYT: Today I'm going to be showing you how to dress like a Vivienne Westwood model.

WOODS: And as far as style, Wailin, I'll just show you some of her videos.


HOYT: Then add either a corset or...

WONG: OK. I see. I see her feed now. OK, so you weren't kidding about the kind of goth, vintage-adjacent 'cause I see a lot of black here.

WOODS: Yeah, black, little plaid. And a lot of other people are into it, too. Like, with half a million followers on TikTok, that puts her squarely with the kind of following that the industry counts as an influencer.

WONG: Right. It's like below 100,000 followers, and you're considered a micro influencer. And then above a million followers - that's reaching celebrity status.

WOODS: Exactly. And so to get the audit of her accounts, I asked her how much she spent every month.

HOYT: For me, it is mostly clothes and fashion, so I'm probably spending a couple hundred dollars a month just accumulating new things. But I also get gifted a lot now from brands.

WONG: OK, so a couple hundred dollars a month. That's over $2,000 a year on clothes and stuff. That's a lot of horse girl T-shirts.

WOODS: And aside from clothing expenses, there is also the longer-term capital investments. So for Kendall, it's an iPhone, laptop, tripod. So add another couple of thousand on top of that.

WONG: I always think about the time - like, just the sheer amount of hours that you have to spend editing and making these videos so that they look really good.

WOODS: Yeah. So Kendall is not a full-time influencer yet. She still has to work a day job, working in advertising. And I asked her how much of her spare time she manages to squeeze into her influencer work.

HOYT: Many. It's most of my free time I spend making content - 10, 15 hours extra a week.

WONG: OK. But then, you know what I really want to know - and what I bet a lot of our listeners want to know - how much does Kendall get paid?

HOYT: So for 2022, I made about $15,000, which maybe is less than you'd expect hearing some other large influencers.

WONG: OK, so $15,000. And then after she subtracts her expenses, that probably leaves her with 11- or $12,000. It's pretty good for a side hustle, right?

WOODS: Yeah. I mean, for a part-time job, not bad. If you want to make it full-time, that's probably not enough to live on in New York City, though.

WONG: Right. I mean, I guess I'm seeing, now, that gap where, if you want to try to make this into a full-time thing, that's a pretty big mountain to climb.

WOODS: Yeah. So I spoke to an expert in the industry, Ryan Hilliard, to see if this was typical. Ryan is a general manager at a company called HypeAuditor, which analyzes influencer data, and he says you need a lot of followers for a comfortable cash flow.

RYAN HILLIARD: There's kind of a magic number where it becomes, I can do this for a living, and that's probably close to that I have a million followers.

WOODS: And there's only a tiny share of influencers who reach that level.

HILLIARD: Less than 1%. It's just too hard. There's too many other people doing similar stuff.

WOODS: Now, first, keep in mind that the amount you can earn varies wildly from influencer to influencer. Like, you know, how loyal are your followers? Do they click on the links that you suggest? Are your followers mainly on YouTube or Instagram or TikTok? And also, what kind of influencer are you?

WONG: Right. Like, are you a fashion influencer? Cooking? Golf?

WOODS: Exactly. And it's also the question of - what are the demographics of your followers? Like, are they higher or low-income? These things all make a difference. Now, the second thing to think about with Ryan's numbers is that, of course, everybody's definition of what counts for enough to live off varies. So let's focus on Kendall. By Ryan's calculations, she could be comfortably earning $65,000 a year, maybe even a hundred grand.

WONG: Oh, $100,000. Wow, that is such a difference.

WOODS: Yeah. And to understand why, you need to look at how influencers make money.

WONG: Are we talking spon con?

WOODS: Spon con exactly - hashtag ad - these posts on TikTok or Instagram where the influencer showcases a new bag or a skirt, captioned, paid partnership. Kendall Hoyt charges $4,000 for a single TikTok post. And Ryan says that, based on his surveys, about 80% of influencers' revenue comes from these paid posts. And a typical influencer might make one or two of these a month. Next up to get money - another 10- to 15% of influencers' revenue comes from affiliate links.

WONG: Oh, right. So this is where a viewer might click on a link on the influencer's profile to buy something, and then the influencer gets, like, 10% of that sale.

WOODS: Well, there's, like, an offer code, and they get a cut. And there's a third way for influencers to earn money, and that's through exclusive content that people subscribe and pay for.


WOODS: Thanks for the plug, Wailin. And while some influencers might even earn all their money through subscriptions, the influencers that Ryan has surveyed only actually earn a small amount this way.

WONG: OK. So given all of that, why are Ryan's numbers so much higher?

WOODS: Ryan says he can basically divide influencers with large followings into two categories - ones that are actively working with companies for sponsored posts and ones that aren't.

HILLIARD: You still have to find brands to partner with. So, like, one of the things that we've asked creators is, like, how much time do you spend on managing your accounts? And people that don't try to monetize, it's usually less than 20 hours, and people that do try to monetize, it's more than 30 hours.

WOODS: So on top of her day job and actually building her following, Kendall says she doesn't have time to proactively reach out to brands to work with. So she's kind of in this bind right now. She's got no time to reach out to companies. But if she does quit her day job, she wouldn't have any sponsors lined up.

HOYT: Like, who wouldn't want to just post a video to make thousands of dollars? But there's a lot more that goes into it to build up a community and be able to get those deals.

WOODS: You know, Wailin, even with these sobering statistics, I figured maybe I might try my hand at influencing. So Kendall helped me with that new look and gave me posing tips.

HOYT: Relax the eyebrows and slightly, like, part your lips, like - yes, this is so good. All right. Straighten up. And then you could, like, tousle your hair.


HOYT: There you go.

WOODS: A little tousle.

HOYT: Slow.

WOODS: Saucy.

HOYT: How do you feel?

WOODS: I feel a little unusual.

HOYT: (Laughter).

WOODS: I've never thought of relaxing my eyebrows before.

HOYT: (Laughter).

WOODS: I realize I have such tense eyebrows.

HOYT: (Laughter) Got to get some Botox.

WONG: So, Darian, did you get some Botox?

WOODS: I did not. But, look, here's the photos before and after.

WONG: Oh, wow. Darian, you look so great. I see the horse girl T-shirt and these new jeans that are no longer skinny jeans. But you honestly look great. I think she did a wonderful job.

WOODS: You got to go shopping with an influencer before...

WONG: Oh, gosh...

WOODS: ...You die. It's like...

WONG: ...I want a do-over.

WOODS: ...It's compulsory.

WONG: Yeah (laughter).

WOODS: There's still time.

WONG: Or maybe I'll go get Botox with an influencer. I mean, the possibilities are endless, really.


WONG: When we come back, Darian and Adrian Ma are going to get into the pitfalls of influencing as a career choice.


MA: Some people are lucky to figure out what they're passionate about when they're really young. And for Ronald Michel, it was dance.

RONALD MICHEL: I've been dancing since I was very young 'cause my parents - I used to see them dance salsa, bachata, all those different styles. And I was introduced to music and kind of fell in love with that.

WOODS: And when Ronald, aka Rony Boyy, first discovered TikTok, he found a place to share that love with the world. For the past couple of years, he's been posting videos of these fun, funky dance routines, sometimes multiple videos a day. And for Rony, all that dancing and posting has started to pay off. Last year, he says he made about $45,000 from video views and brand deals.

MICHEL: So what's really fun about me being an influencer is the fact that I get to do what I love every single day and still, at the same time, make it a successful thing for me to make it be a living.

MA: From the outside looking in, being a professional social media influencer can seem kind of like a dream job. But as we've been talking to influencers, we've also learned that kind of like a regular, schmegular (ph) J-O-B, the influencer life has its downsides.

Can you just, like, start off by introducing yourself?

LYDIA KEATING: Yeah. My name is Lydia Keating. I'm a content creator or, if you'd like to call it, an influencer. But I prefer the term content creation. It just seems like a little more respectable.

WOODS: We reached out to Lydia because online, she's been pretty transparent about the ups and downs of making money as a social media creator. She's what you'd call a fitness and lifestyle influencer, so her videos touch on everything from exercise and diet to fashion and travel.

KEATING: I'm usually based out of Rhode Island, although I'm kind of a bit nomadic right now, and I'm currently in Austria.

MA: Are you over there for work or vacationing?

KEATING: Kind of both. And that's always kind of a weird thing in my life now that, like, any time I decide, oh, I want to do something for fun, it gets tangled up with, like, oh, and that could also be, like, a really good content opportunity.

WOODS: And then this turns out to be one of the first downsides of influencing. When your lifestyle is your brand, the line between work and life get blurred.

KEATING: It's almost like every day, you're getting a performance review from your boss.

MA: That sounds a little rough. OK.

KEATING: Yeah. And your boss is 1.7 million strangers.

MA: One-point-seven million is the number of followers Lydia has on TikTok, by the way. And any time, she can check on how many people watched her videos, for how long, how many have liked them. Lydia says it can be stressful if she thinks about it too much.

KEATING: The grand paradox of it all is that if I do get a video that does well, you know, gets over a hundred thousand views, that just means that there will be an onslaught of hate comments because the more views it gets, the more people have, like, hateful opinions, even if it's a thousand really wonderful, nice, sweet comments and then just one nasty one, like, the nasty one feels so loud.

WOODS: Invariably, she says, a lot of those trolly remarks focus on her appearance.

KEATING: Because my body is, like, on display on the internet so much, like, I'm kind of forced to constantly, like, think about it.

MA: Do you think that's healthy?

KEATING: No, I don't. I really don't. I don't think it's healthy at all. But the way I kind of rationalize it in so much of this career is a lot of people's jobs aren't - there are parts of their jobs that aren't healthy for them. So it's you win some, you lose some.

MA: So these are just a couple of the ways that making a living as an influencer can affect your mental health. But that hasn't stopped influencing from becoming a sort of aspirational career for more and more younger people. One in four Gen Z folks say they want to be a professional influencer.

CHARLOTTE STAVROU: But if everyone's going to be an influencer, then who are they influencing? And that's my - my problem is that the market is going to get oversaturated.

WOODS: Charlotte Stavrou runs an influencer marketing agency in the U.K. called SevenSix, and she's also got opinions on what aspiring influencers ought to know about this industry.

STAVROU: I do worry that so many people want to become professional influencers and not, you know, a doctor or, you know, a health professional in general or, I don't know, a lawyer. And as much as influencers can be paid a lot of money - and I see it every day - one of them is probably a bit better for your mental health.

MA: I don't know, Darian, I know a couple of doctors and lawyers who might disagree.

WOODS: Right.

MA: But Charlotte's point is that the competition for eyeballs among influencers is real.

STAVROU: One thing I would say about being an influencer is there comes a point where it's not as fun as it was. So at the beginning, when you start off, you get invited to lots of events, you get lots of things gifted to you for free, you're, you know, the hot ticket of the moment, sometimes, and it's very exciting. But then when someone else comes along who's also great and maybe hit a trend, then you might move over. And then you're fighting to be seen as much as them.

MA: On top of watching out for the competition, Charlotte says influencers have to watch out for companies, which don't always play it straight. Influencers are basically freelancers, and so when those companies make contracts with influencers, Charlotte says they'll sometimes try to sneak in language that gives them more bang for the buck while shortchanging the creator.

WOODS: Finally, Charlotte says that influencer marketing faces the kind of problems you see elsewhere in the world - bias and prejudice.

STAVROU: Issues with race, ethnicity, culture, gender, ability, there's so many issues in our industry in terms of who's getting paid what.

WOODS: Charlotte's agency has done surveys where they found a roughly 20% pay gap between white creators and creators of color. Some of that can be attributed to follow accounts, but a lot of the survey respondents said they believe race and ethnicity plays a role in that, too.

STAVROU: And it just really shows that when we think about influencer content, the people that are being paid the most are young, white, able-bodied people.

MA: One person who's experienced this pay disparity personally is Ronald Michel, Rony Boyy, who we met at the top. So Rony told us about this time he and a white influencer were hired for the same marketing campaign. He says they both had about the same number of followers. But when Ronald asked that white creator how much they were getting paid, they said a thousand bucks. And meanwhile, Rony says he wasn't offered any money up front, just a potential commission.

MICHEL: I feel like there is racism in the industry and because of that, that makes us have to work extra hard to gain what is easily accessible to other white creators.

MA: How do you feel about that?

MICHEL: Honestly, it sucks - you know? - and it makes me just want to learn the game and then learn the game smart to where the game can't use me.

WOODS: He's intent on overcoming the obstacles. Ronald wants to make influencing a long-term career. Lydia, on the other hand, is a little more ambivalent. She mostly enjoys the work, but eventually, she'd like to transition to make a living as a writer.

KEATING: The truth about this job, of being a content creator is - or my version of it, it's a lonely type of work. It's just you and your phone. To be a content creator is to lack community.

MA: That seems so ironic, though, 'cause the definition of doing what you do is having a community. Having a...

KEATING: I know.

MA: ...Following, at least.

KEATING: But it's, like, a community that I don't even feel like I'm part of, in a way.


MA: Influencing is a booming industry, but also a relatively young one. And with all the good, there's definitely some bad. And in that sense, maybe it's not that different from any job.


WONG: If you're interested in hearing more about the influencer economy, check out the podcast I co-host with Darian and Adrian - The Indicator. We just wrapped up a week that is entirely focused on influencers, from the origins of the industry to how Gen Z is thinking about it as a career path.

This episode was produced by Corey Bridges and Janet Lee. It was engineered by Robert Rodriguez and Katherine Silva. It was fact-checked by Sierra Juarez and Dylan Sloan. Emily Kinslow was the podcast coordinator for the series. Viet Le is The Indicator's senior producer. Kate Concannon edits the show. And our acting executive producer is Jess Jiang. I'm Wailin Wong. This is NPR. Thanks for listening.


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