What's Going On Between Instagram And The Influencers!?

What's going on between Instagram and the influencers? Let's go straight to the point because this will interest you.

We all know that Instagram is the platform that created influencers. These are people with media power who lived very well because the brands paid them a really good amount of money in exchange for advertising.

This business model worked very well for Instagram for a while, but recently they have realized and "complained" that brands are actually paying influencers directly, to which they have asked, "where is my commission?".

In parallel and at the same time that these events are happening, a Chinese platform called TikTok appears. And TikTok from the start did two pretty good things for its early audience.

In parallel and at the same time that these events are happening, a Chinese platform called TikTok appears. And TikTok from the start did two pretty good things for its early audience.

1. TikTok taught its users how to edit videos, and consequently a generation of people that grows by millions and goes viral with each video begins to appear.

2. TikTok pays the content creator directly. Instead, Instagram pays you nothing. You are a slave to Instagram. You create content, you feed the platform and you are not rewarded at all.

With all this happening, Instagram wants to solve this "problem" in its own way. But… the solution sucks.

Instagram's new business strategy is that by realizing that the brands are not paying them anything, what they have done is cut off the reach of the influencer, and perhaps that way the brands, instead of paying the influencer, pay them directly to put the advertising in the users feed.

So… if before a post from a normal influencer was seen by 500k people now it is seen by 200k, which has caused brands and influencers to get upset because the content viewing has been reduced by half and they are paying Instagram the same.

Does this mean that influencers are in danger? 

Yes. 

And let me tell you why.

As I was saying… Instagram is changing its business model, starting in the United States and soon in the rest of the world.

This business model is called the subscription model. This means that Instagram does not want you as a content creator not to live directly from the brand, but rather that your fan base pays you every month to see your content.

This implies two things:

We content creators will have to wake up because if we don't adapt we are going to die and disappear.

All those people who wanted to generate content but couldn't because it was impossible with Instagram, now will have an opportunity to do so.

Does this mean that Instagram will be paid?

No. 

But you will have the option to pay for it.

Instagram is going to move to a freemium model.

Content creators will be able to continue creating free content, but an option will be given in which if the user wants premium content, they will be able to subscribe to your profile.

Does it make sense that Instagram uses this business model? 

Yes.

All the big companies are using this business model. Nowadays users are more predisposed to subscribe to platforms.

How much money do you spend on subscriptions monthly? Make a list: Spotify, Netflix, Uber Eats, HBO Max, Apple One… and so on.

This is not to say that everyone is going to pay for a subscription model. But let's do a simple mathematical exercise.

Imagine an influencer who has a community of 100,000 people, if 1% of his followers pay him five dollars, that person will be earning $5,000 a month (less the Instagram commission).

There is a very interesting part in all this… because… did you know that what people hate most about Instagram is posing? And there's a reason why it does exist. 

Influencers depend on brands. And brands protect their image.

When people stop depending on brands, then they can be real. And the possibility can be opened up to people who are not necessarily influencers, such as psychologists, lawyers, content writers… people who can offer their services through Instagram.

But that's not all...

Instagram has also launched something called the Creator Marketplace.

Don't worry… I'll explain it.

When you agree to a collaboration with a brand, there is usually an agency involved that manages all the influencers of the brand.

This agency takes a 20% commission (normally).

What are the true intentions of Instagram? Eliminate the agency and be the one who connects the brand with the influencer and take that 20% commission.

Does it mean that Instagram is going to end the agencies? I do not think so. But that's another story.

What is certain is that many changes will come. The rules of the game are changing drastically.

As I see it, in theory, with all these changes the content should have better quality and be less massive, but I'm not sure if it will work.

Instagram has it very complicated. It was born when everything was free and now it makes people pay.

Anyway… there will always be TikTok that can be monetized from the beginning and is giving many opportunities.

This is my reflection.

If you like it, follow me and I'll try even harder.