Eric Siu and Neil Patel break down ROI across influencer tiers. Micro-influencers return 36.71% profit on average, while celebrity creators lose 59.43%. Smaller creators win because they have better engagement, lower management costs, and more flexibility on affiliate deals.
Did you know that in-house creators are getting paid $200 grand salary to make TikToks?
That's a crapload of money.
Yeah.
That's overpaying.
Yeah. So the point is, I think we're going to see more in-house creators get paid money. You actually had a good Instagram post. I saw it right before I got here talking about the ROI of influencers.
But I put a caveat in the text. It takes way more time to manage them. And sometimes you need a dedicated person or a team just to help you with the micro influencers because you have to have so many of them to do it in volume and really make the numbers work. the ROI is huge. We ended up looking at 46 influencer marketing campaigns and combined, when you look at all the influencer marketing campaigns, they had 2,808 influencers that were used. And it was funny, some people put in the comments, well, the ROI depends on how relevant the influencer is to the campaign that you're promoting. Just as a caveat, as a marketer, you only choose relevant influencers to promote your product.
You would hope so. Yeah.
I'm like, I don't know who would use an irrelevant influencer to promote a product. You just lose money. So we have 4 categories of influencers. Celebrities, 1 million plus followers. Macro influencers, 500,000 to 1 million. Midsize influencers, 100,000 to 500,000 followers. Micro influencers, 1,000 to 100,000 followers. For the celebrity followers, million plus followers, we saw a 59.43% loss in, and that was a cost. That's how much money they lost. Right? And we're not looking at revenue, we're actually looking at money lost or gained, as in loss or profit. For the macro influencers, 500,000 to 1 million followers, it was a negative 12.04% loss. So if you spent $10,000, just to make a number up, yeah, you're collecting all this revenue, you're collecting more than $10,000, but then there's a cost of your product or service and your team, et cetera. And after all the costs, they lost 12.04%. So in that case, their loss would've been $1,204, just to keep the math simple. With midsize influencers, 100,000 to 500,000, they saw a gain of 13.98%, and this was their profit. So if you spent $10,000 or $100,000, it would just be 13.98% of that being on average profit. With micro influencers, 1,000 to 100,000 followers, followers, whatever they spent, including their internal cost of their team managing these micro-influencers, technically all of them. Celebrities, there wasn't, with the larger campaigns, there really wasn't too many in-house people that are managing the process, but mid-size and micro, there were people managing internally in most cases. But for micro-influencers, they saw a profitability of 36.71%. The big thing here that I put in the comments or I put in the notes that most people don't realize, when you work with celebrity-based influencers or people with big followings, they're super picky. They don't try hard to promote the product. They'll say they want to keep something up only for 4 hours and delete it. They don't want you to use their name and image and photos on their— on your landing pages. They don't want to go above and beyond and also create stories to promote it. A lot of them have egos. They don't care. They just want quick cash and leave. When you work with micro-influencers, they leave up the content, they try super hard, they'll go back and forth and try to create amazing creatives and put in like 110% effort because they want to keep working with you and get more business. And on top of this, not only will they leave it up, a lot of them are really flexible on payment terms. They'll do affiliate-based versus promotion-based. They'll let you use a name and image and all that kind of stuff on the landing page. So it's just much easier to make a profit because they're so flexible. Celebrities and macro influencers, a lot of them have egos and they're hard to work with.
By my podcast co-host Neil Patel and myself. And we have other agency owners that are doing 8 figures a year. They were doing 9 figures a year. They sold their business for hundreds of millions of dollars and they're gonna share their experiences with you. There's a whole host of other benefits. And the cool thing is that there's a 7-day free trial and you should check it out now because we're going to take the prices up. So just go to marketingschool.io/agency to learn more and we'll see you inside. Yeah, and well, once you've made it already, quote unquote, you care a lot less, but in the very beginning you care a lot more. Yes. And that's just how it is. That's how the human mind works.
And I'll give you a great example of this. When we tell micro-influencers, hey, if we pay you, you got to respond to the comments. When anyone has questions, make sure you're there. They'll do it. Celebrities, people with massive followers, macro-influencers, they're like, no, you got to pay us way more if you want this. Like, you can't make the numbers work.
All right, guys. So that is it for today. Please don't forget to rate, review, subscribe. Go to marketingschool.io/agency. I think the price right now is $199 or so. It's a 7-day free trial. we're bumping it up to $399. So depending on when you listen to this, the price may already be at $399. So that being said, goodbye. See you.
