Pay Inequality in Influencer Marketing
Pay inequality is an issue in industries across the United States. There is a racial divide around pay, with White Americans and Asian-Americans receiving more money than African Americans or Hispanic Americans. There even exists a controlled pay gap, a study by PayScale showed. This comparison showed black men with the same experience and education doing the same job in the same region in the United States earned 98 cents compared to every dollar white men made. This two percent difference may not sound like much, but any inequality is a problem, and two percent over the course of a career can certainly add up.
This issue isn’t isolated to any specific industry; it is endemic. There are numerous fields from the corporate world to construction and industrial work where there is a systemic problem. One sector you wouldn’t consider to have a racial pay gap is the influencer industry, but a recent study has shown that assumption to be incorrect.
The influencer marketing industry has grown into a global juggernaut, with a global market size of $13.8 billion, according to Statista. While it was once a small, unproven marketing format, it is now an advertising staple and a viable path to gainful employment for many people around the world.
The study was conducted by MSL US, a Public Relations company. It was an in-depth exploration of the pay gap between white influencers and people of color, and the findings were disappointing.
White influencers are paid, on average, 29% more than BIPOC (Black, Indigenous, People of Color) influencers. If the scope is narrowed to just black influencers, white influencers are paid 35% more. These numbers far surpass the gap in most industries and point to a real problem in the industry.
The study showed some more details that are worth consideration. Nearly half (49%) of the black influencers in the study stated that their race contributed to an offer below market value. 59% of the black influencers reported they felt they were impacted negatively financially when they posted on issues of race, while 14% of white influencers felt the same way.
This study is significant because it is starting an important conversation that needs to be had around the industry. The national conversation around influencer marketing has thus far avoided racial issues for the most part, but the MSL study is showing that there is a serious problem within the industry that needs to be addressed.
How to Address This Issue
Now that it is clear cut that there is an issue, that inequality does exist in this field, it is time for brands and industry insiders to start considering what can be done. Everyone from the top influencer marketing agency to the smallest micro-influencer agency, the biggest brands with massive, entrenched marketing strategies to small businesses just launching their first campaign, all needs to start considering some solutions.
We need to focus on where the problem lies to think of solutions. MSL pointed to two key areas as the primary driver of this problem: an opportunity gap and a lack of pay transparency. In the influencer industry, where knowing the right people and having an affluent lifestyle are major indicators of success, opportunity is everything. Historic inequities contribute to a large divide in this regard.
Pay transparency is the biggest part of the equation here. The influencer marketing industry is one with a lot of pay opacity. There is no standardized pricing, and it often comes down to bartering. According to the study, this disproportionately impacts black influencers, as it makes wage discrimination much more possible. 45% of the black influencers in the study stated managing the financial process as their biggest issue with influencer marketing, while only 27% mentioned the same.
So what can be done? For starters, brands can commit to utilizing more BIPOC influencers in their campaign on a ground level. Some brands don’t think of this, but leveling the playing field is important, and this will require brands to make more of an effort. Countless incredible BIPOC influencers across social platforms will make for great brand ambassadors. Every brand and influencer marketing firm must commit to a change for this to happen from the ground up.
On a broader scale, having more standardized and transparent pay will reduce payment discrimination, improve clarity for fledgling influencers, and help make the overall influencer marketing industry a more level playing field. MSL has already committed to creating a curriculum that will educate influencers on industry best practices, content creation, pricing, and negotiation. They’ve also developed a scholarship for 1,000 BIPOC influencers with high potential but low follower counts.
Overall, it is clear that there is a problem in the industry, but it does not need to stay deeply entrenched. Racial pay inequality is an issue across America, but a commitment from brands and influencer marketing firms can lead to fast and impactful change in the influencer marketing industry.
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To find out how Influence Hunter can help your business, get in touch with us today.
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