If you tap through the daily media or advertising industry news, you'll notice a consistent stream of influencer marketing-related topics. There will be plenty of new companies raising money and claims that this is the year the industry is going to grow rapidly and break out as a mainstream marketing technique.
While it may seem like the industry is huge, I'm here to tell you that it's a pretty small market opportunity. Some companies claim that they are tackling the content space, which is arguably a much bigger opportunity. However, I still haven't seen a company that is able to shift their reputation in a customer's eyes.
The best and biggest venture capitalists in this space, such as 16z, KKR, USV and Sequoia, look for big market opportunities. This means anywhere between 15 and 25 billion minimum TAMs (total addressable markets). Let's compare that with some of the most comprehensive industry reports on influencer marketing. In early 2018, AdWeek published an article predicting that influencer marketing would be a $10 billion industry by next year. MediaKix also released a commonly cited report claiming that the industry could be worth between $5 billion and $10 billion by 2020. InfluenerDB produced a beautiful infographic outlining the rising influencer marketing trends based on their assumed earned media values (EMV). They suggest the market will be worth somewhere around $4.86 billion to $16.616 billion by 2020.
However, as Taylor Lorenz writes about in The Atlantic, influencers have developed a habit of faking sponsored posts, using #ad or a similar tag even when it isn't, which could make the value of this industry extremely hard to quantify. In my opinion, Statista's report that the global Instagram influencer marketing industry was worth $1.07 billion in 2017 and will hit $2.38 billion in 2019 is probably closer to reality.
I think most of these market studies are off base because EMV is subject to a lot of error. Another way to determine the size of the market is to see how many people have a job that pertains to influencer marketing. By my own calculations, I have found that influencer marketing-related positions have certainly doubled on LinkedIn, from about 77,000 jobs in December of 2017 to about 176,000 in January of 2019. That would suggest that Statista is right in thinking that the market has doubled in size since 2017. I would assume that not everyone in these positions mentioned on LinkedIn actually does influencer marketing day to day; rather, some just list it as a skill.