Influencers Threatened with Poverty, Signs Already Visible in America

Jakarta, CNBC Indonesia –Rolling in wealth and a large following is the current image of famous influencers on social media.

Take YouTuber Mr. Beast, TikToker Charli D’Amelio, and even renowned Indonesian artist Raffi Ahmad, who has 76.8 million followers on Instagram.

However, it turns out that the glamorous world of content creation isn’t as glamorous as it appears on a smartphone screen. The online industry is increasingly crowded, giving rise to fierce competition for profits.

Social media platforms are reportedly no longer as generous in paying commissions to content creators. Established brands are also becoming more selective about collaborating with influencers.

This is as reported in a Wall Street Journal report titled “Social Media Influencers Aren’t Getting Rich – They’re Barely Getting By.” For example, Clint Brantley, a full-time content creator since 2021, experienced this.

Brantley shares content on TikTok, YouTube, and Twitch. Most of his content revolves around trends related to the mobile game Fortnite.

Despite having over 400,000 followers and averaging over 100,000 views on his content, Brantley’s income last year was less than the median annual salary of a full-time worker in the US in 2023, which was US$58,084 or Rp 950 million.

The 29-year-old is not ready to commit to renting an apartment due to his unstable income. Currently, Brantley still lives with his mother in Washington. “I’m very vulnerable,” he said, as quoted by The Wall Street Journal, Wednesday (June 19, 2024).

The Wall Street Journal wrote that earning a decent and reliable income as a content creator is difficult, and it’s only getting harder.

Platforms are increasingly paying out less and less for popular posts. Meanwhile, brands are becoming more specific in their influencer deals.

This situation is exacerbated by the threat of TikTok being banned in the US in 2025. Many content creators are worried about whether they will still be able to earn income from social media if one of their revenue-generating channels is removed.

The Influencer Industry Is Increasingly Crowded

According to a 2023 Goldman Sachs report, hundreds of millions of people worldwide post entertaining and educational content on social media. Approximately 50 million people earn money from it.

The investment bank estimates that the number of creators generating income will grow at an annual rate of 10% to 20% by 2028.

This contributes to an increase in the number of income earners, although the Department of Labor does not track influencer salaries.

On average, content creators need months or even years to generate income from social media platforms, brand partnerships, and affiliate links. However, the more people seeking income from this industry, the smaller the “pie” that must be divided.

According to NeoReach, last year, 48% of influencers earned less than US$15,000 (Rp 245 million). Only 14% earned more than US$100,000 (Rp 1.6 billion).

This disparity in influencer income is determined by several factors, such as whether the influencer works full-time or part-time, the type of content they share, and the duration of their influencer career.

Some people who rose to fame during the Covid-19 pandemic and focused on popular topics like fashion, investing, and lifestyle hacks said they found the momentum to be very helpful.

However, despite all this, content creators admit that this work is very draining on energy and mental well-being. They must constantly think about what content their audience will enjoy and seize the right moment.

Influencers spend days planning, producing, and editing content for social media uploads. They also have to constantly interact with their fans to maintain their popularity.

“It’s a much harder job than most people think,” said Emarketer analyst Jasmine Enberg.

“Creators who make a living as influencers have been doing it for years. Most didn’t get big overnight,” the analyst said.

Furthermore, influencers who work independently don’t enjoy the same benefits as office workers. They don’t receive health insurance, pensions, or annual bonuses.

Amid inflation and economic uncertainty, influencers face increasing pressure to secure their finances.

Platform Revenue Is Decreasing

From 2020 to 2023, TikTok had a creator funding program of up to US$1 billion. YouTube, through its Shorts feature, also allowed creators to raise around US$100-10,000 per month through a temporary funding program.

Furthermore, Instagram Reels rewards creators with fluctuating amounts. These large bonuses were a tactic to attract more people to create content on its platform.

However, platforms are now changing their payment policies for content creators. The requirements for TikToker earnings have been expanded. They require a minimum of 10,000 followers and a minimum of 100,000 views per month.

Instagram is also testing an invitation-only program that provides cash rewards to creators who share Reels and photos.

YouTube introduced an ad revenue sharing program last year for Shorts creators who have at least 1,000 subscribers and 10 million views within 90 days. They will receive a 45% share of the ad revenue for the content they share.

TikTok users have reported increasingly difficult earnings. One example is Ben-Hyun, who said last March he earned US$200-400 per million views. However, his income has since declined, despite his growing following of 2.9 million.

Ben-Hyun said he now only earns US$120 for a video that garners 10 million views. This shows that even though influencers have large audiences, it remains difficult to monetize them if they rely solely on platform revenue.

Danisha Carter shared similar concerns. She said her TikTok account has 1.9 million followers.

She believes content creators have successfully hooked their audiences on online platforms and generated billions of dollars in revenue for TikTok and its affiliates.

However, influencer pay isn’t commensurate. He claims to have earned a total of US$12,000 from TikTok. To increase his income, he decided to create merchandise and earned US$5,000 last year.

“Creators should be paid fairly, with a percentage that reflects the revenue generated by the app,” Carter said.

“There must be transparency about how we’re paid, and the policies must be consistent,” he advised.

SOURCE : CNBC INDONESIA