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May 10, 2020

Influencers and Their Jaw-Dropping Profits Explained

When people think of influencers, they usually think of a vain teenage girl posting selfies on Instagram. She’s probably doing her makeup, crying about boys, and lecturing you about global warming.

While that feels pretty easy to dismiss, what if I told you influencers do great work on numerous topics? What if you found out influencers get insane traffic numbers, work from home, and make bank?

Let’s get into who these influencers are and how their businesses work.

What is an influencer?

An influencer is anyone that’s using new forms of media to gather a large audience. Influencers can get their traffic from many sources. Sources that include YouTube, Google, Facebook, Twitter, Instagram, Podcasts, and more.

Traditional media tends to talk about influencers in associations with brands. You’ll hear about how some C-List celebrity is selling a fortune worth of products on their Instagram.

And while that does occur, it’s a tiny subset of influencers. Most influencers wouldn’t even qualify as D-List celebrities. Yet, they reach hundreds of thousands of people per month or more.

If you want to find them, simply Google or YouTube any subject. There you will find an influencer that’s owning the space for that platform.

How Many Views Are Influencers Getting?

The Big Bang Theory was once the highest-rated show on television, coming in at over 18 million views per episode. That’s a lot of views. But, compared to YouTube, it’s not that impressive. This 7-minute video by VSauce (made in 2012 before he was a high profile YouTuber) has received over 32 million views.

Of the 30 or so YouTube channels I subscribe to. Alt-Shift-X, Oversimplified, Polymatter, RealLifeLore, and VSauce each have at least one video with over 5 million views. And there are plenty of channels in existence where the creators have over 1 BILLION VIEWS.

I really want you to stop and think about that for a second. Some of these creators were “regular guys.” These one man bands now have single videos with more views than the highest-rated show in television history.

Why Do Brands Partner With Influencers?

YouTube and television are both video mediums that sell 30-second ad slots. So they’re the closest apples to apples comparison that we have as far as monetization rates go. A 30-second ad spot on The Big Bang Theory costs over $276k. Compare that $15 RPM (revenue per thousand impressions) to the $2 RPM YouTube creators see on ads. You’ll see that it’s much cheaper for brands to advertise on YouTube.

But, it’s not only that YouTube advertising costs less. This traffic also converts at a higher rate. Influencer content usually targets a niche. So pretend that you’re a company that sells ping-pong paddles. Would you rather serve ads to a ping-pong based YouTube channel or The Big Bang Theory.

searcher intent and niche sales

That’s not all. Influencers have a connection with their audience that television can’t match. Pretend I follow a YouTuber whose channel focuses on weight loss tips. That guy can sell me on weight loss products in a way that The Rock never could. I’ll buy anything that he tells me to, meanwhile ads are background noise to me.

why you have a better relationship with your readers than advertisers do.   Difference between warm and cold traffic.

Finally, people browsing influencer content are already on their computer or cell phone. Meaning these users are only a couple clicks away from buying something. This boosts influencer conversion rates even further.

The end result is a dramatically underpaid influencer that can convert content into sales at an astounding rate. Do you see why big brands think influencer marketing is the future of marketing?

This is a seriously impressive business model, not a bunch of vain wannabe celebrities to scoff at.

How Do Influencers Make Money?

Brands right? Didn’t we just go over how brands are the ones paying influencers?

Sure, that can happen. But, I’d recommend influencers create their own product. After that, I’d recommend affiliate sales. Then ads. Brand deals or sponsored posts don’t even crack my top 5 ways to make money online.

Influencers are themselves a strong brand. One that has gained the trust of their audience. They have to be careful who they partner with to not break that trust. On top of that, most brands are using influencers to avoid paying the “premium prices” that larger ad networks charge. They’re looking to get a deal.

This is why I tell most influencers to skip brands and go straight to your own products or affiliate sales.

How Much Money Do Influencers Make?

It depends on the size of the influencer’s audience and how they monetize their content.

Let’s start with ads because they’re the simplest. Remember how The Big Bang Theory was pulling in a $15 RPM? On YouTube, Adsense ads pay a $2 RPM on average. For context, a million views at an RPM of only $2 will net you $2,000. Which is abysmal.

traffic needed to make 6 figures at different rates.

Affiliate sales can be a better monetization model. But, it depends on the affiliate program you use. Sell a product on Amazon, and you’ll only earn 3% of the sales price. Sell a single ClickFunnels subscription, and you’ll make $40/m until that user unsubscribes. The vast differences between affiliate program payouts makes it hard to predict RPM’s with this business model.

The smartest influencers are sell their own high-margin product. That’s where all the money is. For instance, Sunny Lenarduzzi has a $597 digital course on how to create better YouTube videos. She actually made a YouTube video about how she sold 167 courses from 1 video that got 100k views.

If you do the math on that, it’s an RPM of about $1,000. Which is so absurd it’s hard to come up with words for. This woman is a multi-millionaire solely by having a decent YouTube following and a course. That’s the power associated with being an influencer.

How Many Followers Do You Need To Be Considered an Influencer?

There is no set amount of followers that magically turns you into an influencer. I prefer to frame this question as “How many views do you need to run a successful business.”

This depends on how you monetize. If you make a $1,000 RPM like Sunny, 100k views over a year is a six-figure income. I’d consider this woman an influencer even if that was all the traffic she ever got.

But, if you only had a $2 RPM from YouTube ads, you’d need 50 million views over a year to hit the same six-figure salary. In that case, you need a lot of traffic to consider this a business.

But, it’s hard to say that somebody with millions of views isn’t influencing society in a major way. A big brand would and should consider this person a prime target for influencer marketing efforts. These people wield enormous influence and don’t understand what their traffic is worth.

How Many Views Are Influencers Getting On Various Platforms?

Many people fail to recognize just how much traffic is up for grabs on various platforms. For instance, my little blog gets over 100k page-views per month from Google! That’s more than enough people to fill a football stadium!

Yet, it’s a tiny fraction of the traffic Google hands out. In 2019, there were over 3 trillion search queries entered into Google. Meaning my traffic makes up less than a millionth of the traffic Google sends to bloggers.

Number of Google searches over time.

YouTube (also owned by Google) is the other major platform to look for influencers on. There are over 5 billion videos watched per day on YouTube. We collectively spend 108 million hours per day watching YouTube compared to 165 million hours watching Netflix.

And Google is not the entire Internet. What about the traffic from Facebook, Instagram, Twitter, Pinterest, Snapchat, Reddit, Quora, and more? Well, it’s hard to pin down the exact traffic numbers that each platform delivers. But, here are the number of monthly active users they have to give a sense of scale.

Monthly Active Users on Popular sites over time.

Each of these platforms has nearly half a billion users. All of their users are regularly consuming content. When 100k impressions is all you need, you’ll see each of these platforms can easily create a large number of influencers.

How Influencers Affect Society At Large

The other day my garbage disposal broke. The first thing I did was YouTube “How to fix a garbage disposal,” and of course, a video popped up explaining how to do it step by step.

That man didn’t have a large YouTube following. He wasn’t even trying to sell me anything (that I could tell). He’s just a guy who taught me how to fix my garbage disposal. A guy that I trust more than any hardware company in the world. The man is a national treasure.

When you think of influencers, I want you to think of all the helpful blog posts and Youtube videos you’ve come across. Yes, the vain selfie-taking Instagram models exist. But, they’re a small subset of the influencers out there. The people who help you solve problems are the ones that are generating sales at a crazy rate. That’s where the real value is.

Thanks for reading! Let me know if I changed your opinion on influencers in the comments!

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