Unlocking the Power of Influencer Marketing: India’s Booming Industry Set to Soar to Rs 3,375 Crore by 2026

In recent years, influencer marketing has emerged as a powerhouse in the world of brand promotion, with 75% of brands expected to incorporate it into their marketing strategies. This surge in popularity is mirrored in India, where the influencer marketing industry is projected to reach a staggering Rs 3,375 crore by 2026, growing at a compound annual growth rate (CAGR) of 18%. According to EY’s Collective Artists Networks Big Bang Social Report, India’s influencer marketing sector is anticipated to expand by 25% in 2024, hitting Rs 2,344 crore compared to Rs 1,875 crore in the previous year.

One of the driving forces behind this growth is the significant amount of time that smartphone users devote to various social media platforms, with approximately 50% of their screen time allocated to these platforms. Among the plethora of social media channels available, Instagram and YouTube stand out as preferred platforms for consuming content produced or endorsed by influencers.

This meteoric rise in influencer marketing has substantial implications, including financial gains for influencers. The report suggests that around 86% of influencers can anticipate a growth in their income by over 10% in the next two years. Moreover, more than half of the brands surveyed allocate over 2% of their budgets to influencer marketing, with 70% planning to maintain or increase their expenditures in 2024. Notably, 50% of these brands intend to augment their investments in influencer marketing by roughly 10%.

However, the decision-making process for brands doesn’t solely hinge on the size of an influencer’s following. Factors such as engagement rate (27%), quality of the target audience (26%), industry specialization (24%), and follower count (23%) play pivotal roles in the selection or rejection of influencers as brand ambassadors.

Interestingly, brands are increasingly leveraging both large and nano influencers (those with 100-10,000 followers) in equal measure. Nearly half (47%) of the brands surveyed prefer nano influencers over their larger counterparts due to lower cost per reach and higher engagement rates. Nano influencers boast an impressive engagement rate of nearly 4%, whereas large influencers typically range between 1.5% to 2.5%.

The primary objectives driving brands to engage in influencer marketing include driving brand awareness and social media engagement. Approximately 61% of brands utilize influencers to achieve these goals, with 32% focusing on brand awareness and 29% on driving social media engagement. Additionally, 22% of brands leverage influencer marketing for lead generation, while 17% employ it for sales conversion.

Looking ahead, the growth trajectory of influencer marketing in India is expected to be fueled by sectors such as lifestyle, fashion, and beauty. Industries like automobiles, e-commerce, and FMCG are also poised to ramp up their investments in influencer marketing.

Commenting on the report’s findings, Amiya Swarup, Partner, Marketing Advisory, EY India, highlighted the evolving role of influencers in Indian society. He noted that influencers are increasingly perceived as contemporary heroes who provide guidance, reassurance, and advice amidst societal, career, financial, and cultural transformations. Swarup emphasized that influencers are now instrumental in shaping knowledge and impact, presenting vast opportunities for brands and marketers alike.

#Influencer Marketing