“Swipe up to get this exclusive product and get a 20% discount using my code”—have influencers tapped into their fullest marketing potential?
Unless you’ve been living under a rock, you’ve likely encountered these social media calls to action. In the realm of digital marketing, influencer marketing has carved out a massive niche. It is on track to become a US$38.2 billion industry by 2030, thanks to influencers who use platforms like TikTok, YouTube and Instagram to sway consumer choices.
But there’s a new trend on the block: influencers are no longer just peddling other brands’ products; they’re launching their own.
The magnetic pull of influencers
To grasp why influencers are venturing into brand creation, it’s crucial to first appreciate their substantial sway.
Influencers are the new-age celebrities of the digital world. They wield considerable power to influence consumer behavior through their posts, stories and videos. With the global social media user base expected to balloon to 5.85 billion by 2027, influencers are changing the rules.
Unlike brand ads that scream “buy me”, influencers’ endorsements often appear more sincere and authentic—or at least the perception of it—and feel like trusted advice coming from a friend. It’s this genuineness, coupled with their savvy engagement strategies through DMs, comments and live streams, that has followers willingly opening their wallets.
But there’s only so much that an influencer can juggle. When brand deals keep sliding into their DMs, some influencers turn to influencer marketing platforms to connect with brands (and vice versa) and grow their career.
An example of these platforms is Thailand-based SHOUT!. It matches influencers with brands to save both parties time and streamline campaign operations. To make sure both parties are a good fit for each other, SHOUT! gathers insights from the influencers’ accounts and suggests campaigns that align with their niche. Influencers can choose to work with brands that they like on their set rates and conditions. Agencies like SHOUT! can leverage their industry experience to help influencers grow their career and fetch exclusive partnerships and collabs that might otherwise not be accessible to independent influencers.
The fact that over 75% of brands have allocated some budget for influencer marketing proves the impact of influencers in this day and age. Obviously, the opportunities to work with brands are vast for influencers. But upon realizing their impact and reach, some are dreaming bigger and eyeing another pie—launching their own brands and products.
The next chapter: Influencers as brand owners
The leap from endorsing products to launching personal brands isn’t new. Since the dawn of social media, creator brands have been popping out. Think Ipsy, founded by Michelle Phan—the OG beauty vlogger—in 2011 and reported US$500 million annual revenue in 2019.
Fast forward to today, and the influencer realm has exploded—there were 64 million influencers on Instagram in 2023. With a growing social media user count (from two billion in 2015 to almost five billion in 2023) and the relatively low marketing cost and high engagement with their loyal followers, the stage is set for more influencers to turn their passion projects into profitable ventures.
Unlike traditional endorsements, having their own labels allows influencers to deeply embed their style and ethos into the products. They are sharing a piece of their world with their followers—and getting some big bucks in return.
Some of the most popular influencer brands include Chiara Ferragni Brand by Chiara Ferragni (annual revenue in 2016: US$20 million), Kylie Cosmetics by Kylie Jenner (expected to make US$360 million in 2024), SKIMS by Kim Kardashian (expected to make US$750 million in 2023), Huda Beauty by Huda Kattan (reported US$200 million revenue in 2023), Sweat workout app by Kayla Itsines (sold for US$400 million in 2021), MrBeast Burger by MrBeast (made US$100 million in revenue a year after its launch), Painted by James Charles and ITEM Beauty by Addison Rae.
Challenges and opportunities
Despite the allure of launching their own brands, transitioning to brand moguls isn’t all sunshine and rainbows for influencers. They face the same hurdles any entrepreneur does: product development headaches, supply chain nightmares and quality control woes. Transitioning from influencers to industry insiders, they also have to grapple with the steep learning curve of business operations and financial risks. And with influencers themselves as the brand’s front and center, keeping their credibility intact is paramount.
Social media, for all its perks, is a risky realm to tread. One wrong move and the digital court of public opinion can turn against you. Thus, the stake is much higher for influencers, as their influence can become a liability for their own brands. With the loss of trust and brand loyalty comes a great dip in sales.
A case in point: beauty influencer James Charles and his brand “Painted” are being “canceled” following alleged sexual misconduct (resulting in his partnership with Morphe ending in 2021) and allegations of his brand’s products violating FDA regulations. When he launched “Painted” in 2023, netizens were split in their views of the brand, and some stated that they wouldn’t back it because of his grooming accusations.
That said, the opportunity to monetize their personal brand and directly engage with their audience still presents a lucrative proposition for influencers. The direct-to-consumer model facilitated by social platforms offers influencers a unique advantage to market and sell their products, bypassing traditional retail barriers and fostering a direct connection with their followers.
Market research supports the potential success of influencer-founded brands, particularly among younger consumers. Almost one-third of U.S. adults have already purchased products from influencer brands, with those numbers jumping to 53% for Gen Z adults and 47% for millennials. Many (80%) were pleased with their purchases and willing to buy from them again, and nearly half reported a shopping experience surpassing that of traditional brands. This trend underscores the emerging opportunity for influencers to leverage their followings into successful brand ventures.
Are influencer brands going to make it big?
With their finger on the pulse of consumer behavior, influencer brands appear to have quite a promising future. The explosive growth of influencer marketing provides a fertile ground for the expansion of influencer-made brands, especially among Gen Z consumers, who heavily rely on influencer recommendations for purchase decisions.
As influencers venture into the world of brand ownership, the question isn’t if they’ll succeed, but how far they’ll go. The digital marketplace is vast, and for influencers with ambition, the sky’s the limit.
Header Image from iStock
