A group of people huddle inside a small studio to brainstorm content strategy for their influencer clients. They comb through endless Reels, YouTube videos and occasionally ‘lol’. But this is serious business at IPLIX, even though the office looks like a college lounge. Crores of rupees are at stake here. This is one of India’s top influencer spotting and marketing agencies.
Creators like Shlok Srivastava, better known as Tech Burner, Thugesh or Mahesh Keshwala, Ritvi Shah, and Saloni Gaur turn to IPLIX to get lucrative deals and be at the top of their game.
The space once occupied by model/talent agencies in the 2000s is now occupied by influencer marketing agencies. Barter or paid, everyone now wants to be a creator or collaborator. The returns are high and the work is not the ‘boring’ 9 to 5. Everyone wants a slice of the influencing pizza. But it is ultimately these agencies that are making the biggest buck.
Influencer marketing is booming — even as Indians grapple with the massive amount of money being earned by influencers or creators. IPLIX and Vavo Digital are game changers in an industry that is still unstructured but is handling crores of rupees, and multiple talents and brands.
Vavo Digital’s Delhi office has three employees—all in their early 20s—who sit in a co-working space in Connaught Place. Two of them, Shreyansh Jain and Namrata Manchanda, were classmates at Delhi University’s College of Vocational Studies. They interned with Vavo for a year before becoming permanent employees and now pitch big-budget campaigns to various brands. They are among many young people who are a part of the influencer world, be it as creators or brand campaign designers.
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Upcoming game-changers
Content creation is no longer limited only to popular platforms like Instagram, YouTube and Facebook. Brands are targeting people from lower-income brackets, whose access to the internet has skyrocketed with cheap smartphones and data plans, through platforms like ShareChat and Telegram. Groups are created where products from pan masala to clothes are promoted.
“It is a misconception that only Gen Z or millennials are consuming content online. Even older people, like our parents do, though they might not know the jargon like a creator or an influencer,” says Jain. He narrates an incident when an Uber driver asked him if he could ‘rely on a guy who makes videos on sales in various stores in Delhi’. “See, he did not know he was consuming content created by a creator. But he was being influenced by it.”
Currently, LinkedIn is one of the fastest-growing content creation platforms, and Vavo has already claimed a piece of the pie. It manages LinkedIn influencers like Palak Rathi, Punita Parekh, and Siddhant Garg.
“LinkedIn seems more ‘verified’ or trustworthy because the creators are already achievers in their fields. So the brand placement feels more authentic,” says Jain.
But the bigger game-changers are regional audiences in tier 2 and 3 cities. From OTT shows and platforms to creators, regional is the new buzzword. It has been aided by the burgeoning interest in the south Indian film industries.
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Young workforce
Big brands, bigger talents and the game of content creation are mostly handled by people who are avid content consumers themselves—usually Gen Z or millennials.
According to the Youth in India 2022 report released by the Ministry of Statistics and Programme Implementation, those in the age group of 15-29 years make up 27.2 per cent of Indian population. It comes then as no surprise that brands want to target Gen Z as much as possible and companies want to hire young guns to lead their campaigns.
IPLIX has 70 employees, with an average age of 23, who handle the business. CEO and co-founder Neel Gogia dedicates his time to setting up a training school for influencers, especially nano influencers. “I want to help this industry grow, and also want upcoming talents to understand the tools that can help them grow,” he says.
For Gogia, his dive into influencer marketing began in 2015, when he was pursuing his BTech degree. While still in college, he offered to be the manager of a YouTube fitness influencer and help him land deals with brands. “I charged Rs 5,000 per month,” he adds.
He started IPLIX in 2019, with entrepreneur Jag Chima. And from Rs 5,000 the company’s growth has skyrocketed. Their current growth rate is 400 per cent and the expected revenue in the next financial year is Rs 75 crore.
Radhika Agrawal and Neha Puri started Vavo Digital in 2020. The duo, then 28, saw that content creation was booming. “We had a gifting brand, but once Covid hit, we had to shut it. That is also when content creation was at its peak, and we decided that we can build something around it,” says Agrawal.
Creators rely on these agencies to help build their engagement, presence and endorsements. Along with ‘traditional’ departments found in ad agencies like operations and talent management, influencer marketing firms have departments that also handle personal brand management. Entrepreneurs like Ghazal Alagh, founder of Mamaearth, and Arjun Vaidya, founder of Ayurveda brand Dr Vaidya’s, are some of those on board to build their social media personas.
Money matters
Case studies related to influencer marketing are part of business school curriculums, under digital or internet marketing modules. “Influencer marketing is not some new form of marketing, but a new means of communication,” says Anirban Chakraborty, faculty, marketing at IIM Lucknow.
Regardless of whether B-schools are paying attention, influencers are making their mark. In November last year, Sharan Hegde, a financial content creator was invited as a guest speaker to IIM-Bangalore. The catch? Hegde, now one of India’s top financial influencers with two million followers on Instagram, failed to secure a seat at that very college four years ago.
But the visibility and fame that comes with influencing is perhaps the easy part, it’s making money that’s difficult. There is no fixed income, no matter how many followers you have or how high your engagement rate is. To give a ballpark figure, nano influencers — those with followers between 5,000 and 20,000 — can earn almost Rs 15,000 per post while a macro influencer, those with upwards of 1 lakh followers, can earn Rs 5 lakh per post.
This is where influencer marketing agencies come in. They act like middlemen between brands and creators to get the best deal for both.
The industry is still being structured, which means the government is only beginning to introduce amendments and guidelines. The first step was 10 per cent tax deducted at source (TDS) for ‘freebies’ or PR gifts that influencers receive. It came into effect on 1 July 2022.
On 20 January this year, the Department of Consumers Affairs released new guidelines for influencers. These include disclosing ‘material’ endorsements, from gifts to hotel accommodations, and fines that can reach up to Rs 50 lakh in case of violations.
So what does it mean for this industry — which is projected to reach a valuation of Rs 2,200 crore by 2025? “Brands are finding great success in generating revenue through social media influencers. As a result, it has become increasingly important for these influencers to adhere to ASCI [Advertising Standards Council of India] guidelines and best practices in order to maintain their credibility and effectiveness,” says Vavo co-founder Puri.
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Fickle loyalty
Brands are keen on entering the space of influencer marketing. “It is a form of marketing that startups usually go for because you can start out at minimal rates,” says Radhika Agrawal.
When advertisers realised that content creators had captured the audience, they decided to adapt. The easiest indicator is the budget allocation for ads; earlier TV ads took up almost all of it. “Now traditional ads are given 50 per cent and the rest are taken up by influencer marketing,” says Divyansh Gala, group head, outreach, SoCheers, a marketing agency.
But influencing is a fickle universe “If a creator, no matter how big a name, is inconsistent with engagement, brands might drop them. The loyalty term is maximum of three to four months,” says Gogia. The same is true of the audience.
“Our lives are ruled by numbers. and that can get really stressful,” said Gen Z influencer Srishti Garg told ThePrint in an earlier interview.
Loyalty is equally transient for brands. “No matter how much you promote or you are all over social media, it is the product that will ultimately decide the profits,“ says Samiksha Mehta, business development manager at Pollen, a marketing agency.
However transient individual influencers or brands may be, influencer marketing agencies are here to stay.
Social media drives us, which is why we end up buying the products endorsed by our favourite creators, be it make-up or credit cards. But does that mean the good ol’ TV ads will soon fade away? Gala does not think so.
He thinks that the ‘trust factor’ still resides with traditional ads because influencers often endorse products from competing brands. “People still watch a lot of TV and that means watching ads too. Traditional ad-making might evolve, in terms of the talents they hire or what kind of ads they make, but they won’t die out.”
(Edited by Theres Sudeep)