How to Prepare for 2023 & More Industry Predictions - Ep. 42

Last updated on
September 19, 2023
James Nord

Welcome to Negronis with Nord. The final episode of 2022 features James’ eight predictions for 2023 and how you as a creator can best prepare for them. You can submit your questions for future episodes here.

Below is a transcript of the full episode for your reading pleasure. Make sure to subscribe to the Fohr YouTube channel to get notified of new episodes.

First, a thank you

James: Welcome Negronis with Nord. Oh gosh, welcome. Negronis with Nord, episode number 42. My last one of the year.

When did we start this show? January. Yeah. Yeah. So look, I I hadn't really done a show consistently for 18 months or so. We kind of start stopped. We obviously had a Drink with James. We picked it up and did Fohrcast or Fohrground, I don't know what it was called for a little bit. And then I missed, I missed doing this, I missed talking about this stuff. I missed feeling closer to the actual work. As, as I think I've mentioned before, you know, we're almost a hundred employees now, and so, so much of my job is dealing with my employees and management, and less about actually influencers. So this is something that keeps me really close to the work and I've enjoyed it. And I just wanna thank y'all for, for listening and for watching. Whether you, you're on YouTube or you listen to the podcasts and sending in questions.

I appreciate it. This is, this is like a kind of fun, easy part of my week that I enjoy. And I hope y'all have, I hope y'all have gotten something from it as well, and I hope it's helped you in your careers whether you're on the brand side or the influencer side. And you know, as always, like, let me know what you want to hear more of. It doesn't have to be a specific question. If there's certain topics you want to us to dive into more or talk about more, let us know. I don't do this for me. I, and so, you know, whatever y'all want me to talk about is what we will talk about. But again, thank you for, for sticking along for the kind of third iteration of this show. It makes sense at the end of the year to talk a bit about what we think is going to happen next year.

Prediction 1: Little to slow growth in 2023

James: Some of this will, you know, be things you've heard me talk about before. We're gonna put out a PDF with our broader predictions for next year with any links to data and things like that. But this is just some things off the top of my head that I think you should be thinking about as you go into next year first as you look at next year.

I think it just makes sense for any influencer to assume you will make the same amount or less money than you made next year. We are in really strange times economically, while I still have complete belief in influencer marketing as an industry, and that it will continue growing even in the face of economic headwinds. It will not grow as quickly as it did last year. I think that's pretty, pretty clear. There is going to be pressure on marketing budgets that is going to result in some deals being cut out and some brands reducing spending or not investing less money to go around for the whole industry, and it's gonna be harder and harder to close deals.

So while we should always strive for growth and, and we should hope that we grow and we should do things to plan to do that, it just makes sense and it is fiscally responsible for you to assume no growth or 10 to 15% down from this year's earnings.

Prediction 2: More scrutiny on brand spend

James: That brings me to prediction number two, which is not only is it gonna be harder to make money, but brands are going to have a lot more scrutiny around the money that they spend. There is a enormous focus on return on ad spend roas. While I think that we've talked ad nauseum about why attribution models are difficult in the influencer space specifically, again, this is not the time to bury your head in the sand and say it's all gonna be okay. It's, it's my job is to create content, not sell product, all these things.

Those things, you know, can be true. But ultimately, if every brand starts to focus more on what are they getting from the money that they're spending, there's not much a single influencer can do to push back against that tide, you have to have strong reasoning on why the prices that you're charging are worth paying, what that brand gets, how you perform better than your peers that they could also spend money for. And do the work to, you know, one, make sure you're creating really compelling content. But then after the campaign, tell that story to the brand about why it worked. Send them the dms of people who said that they purchased a product. Send them comments, you know, a sample of comments of, of people talking positively about the product. Sometimes that's enough. They don't always just need sales numbers. Brands, sophisticated brands understand that.

Again, the attribution models really just don't exist for the influencer space. But do not kid yourself and think that there's not gonna be more pressure on the dollars that brands are spending with you next year, because there absolutely is. That's not a prediction, that's not a thing that's up for a discussion. That is a ******* fact. It is already happening, it's done. And so that's your new reality.

Prediction 3: 50% chance of TikTok ban

James: Number three, I still think there's a good chance that TikTok gets banned this year. I talked with Phoebe Bain in our episode a couple of weeks ago about this. She disagreed with me, Marco Rubio, who's, you know, generally kind of a piece of ****, but he just brought a bill into the house to ban TikTok. I haven't dug into it yet deeply. I plan on doing that over the next couple of days. I don't know how much of a chance it has in passing.

I don't know what exactly it means. Doesn't mean taking it out of the app store. You know, it's, it's hard to know exactly what that means. But I still think there's a 50 50 chance that TikTok gets banned this year.

Prediction 4: Influencer pricing will be flat or go down

James: Number four, part of the economic headwinds and the focus on ROAS is that I also think for the first time in years, years, influencer pricing will be flat or go down this year, again, this is a market. As an influencer, you have benefited from market forces. The last three years, influencer pricing, I remember from 20 in 20, 21 went up 43%. What you would pay for an influencer with a hundred thousand followers went up 43% in one year. We haven't done the study yet this year, but I'm sure prices went up again significantly this year. I don't think that's gonna happen next year.

I think we could see prices go down, and that's just part of a, a market, a free market. One way to get more of a return on the investment is that the investment is smaller, right? So if I charge you a thousand dollars for a post, your expectations are different than if I charge you $5,000 for a post, right? Same performance. But the, the math is different because when I paid for it was so different. So all of that happens. It could be more difficult for you to, to maintain the pricing that you have had. That is one of the beautiful and difficult things about operating in a free market, is that markets move. What you are able to charge is determined by these tens of thousands of, or hundreds of thousands or millions of different data points all working together. Ultimately you might lose the power to control those things and your pricing might have to come down.

Prediction 5: "Wellness" will fall out of fashion

James: Number five, we talked a little bit about this in the beginning of the year, I think. I've said that I generally don't really like what wellness as like a topic. We talked about how we thought, you know, people were gonna talk a lot less about wellness. And that was kind of coming out of the pandemic. I think people wanted to party. They were drinking espresso martinis and, and dressing up and going out. And it was all about, about, you know, kind of being free and roaring twenties type feeling. I think again, it's going to continue to be harder and harder to talk about wellness when if the economic situation deteriorates more, you know, it will come across as even more privileged. Whether or not that's fair, I mean, wellness should be separated from, you know, means, but like it or not, it's tied up in the goop kind of world of, of, you know, hyper privileged people's spending enormous amounts of money and, and, and time to kind of focus on themselves and wellness.

So I think that will continue to be a trend that wellness kind of falls out of fashion as a thing to talk about.

Prediction 6: Look out for creator performance bonuses

James: Number six, performance bonuses. I think we're gonna see more and more brands offering bonuses for content that performs really well. This is something four is gonna start rolling out and we're experimenting with. So, you know, setting aside a portion of a brand's campaign spend to offer it as bonuses for extraordinary performance on TikTok or Instagram. We want influencers to get some of the upside if things go really well or be rewarded for going above and beyond in a campaign. So I think we're gonna see more of that.

Prediction 7: Influencers will question how to exit this career

James: Okay, number seven. This isn't a trend, but just something I've been thinking about. I think a lot of influencers are probably gonna be grappling with here in the, in the next year is how do you exit?

If we look a year, two years ago, right? A lot of influencers felt like one subscriptions might be a place where they can kind of build some stability into their life. I really love the idea of influencers selling subscriptions and moving away from advertising dependent revenue. We tried it three or four years ago, didn't work. So while I knew and predicted correctly that Instagram would roll out subscriptions they haven't worked well, cks not really working well. It is very, very difficult to get people to pay for something that they get for free everywhere else. So subscriptions is not the path to stability and financial freedom for influencers. Then there was this idea that like, you could start your own brand. That was the path, right? But we're seeing a lot of influencer brands shut down. Something Navy, who's an absolute powerhouse. Someone that has always moved a lot of product, her brand is really struggling.

A number of other big buzzy influencer brands of efficient shut down beauty lines have been shut down. I think that path is starting to close off for influencers as well. The idea that, you know, any influencer can just kind of create a brand and that can be the way that they build their financial freedom and stability in the longer term. So we're left back where we started, right? That the only way to ensure your future is probably creating great content that your audience continues to want to consume. Making sure that you are fostering and investing in a community, that you are pulling new people into that community all the time. That you are thinking about how that community makes sense on different platforms, you know, to continuing to make good money here. Because it seems like everything else hasn't really panned out. So I think that's something for a lot of influencers to face and to think about this year.

Do you wanna make content for 15 more years, 20 more years, 30 more years, life is long. Can you keep your audience engaged? And do you have the energy to, to do it? So that's a, that's a real concern that, you know, I think an influencers don't think enough about, because if you have a couple years where you're making good money and you think this is always gonna, this is gonna keep going. I mean, again, let's say you're, you're followings on TikTok and it gets banned tomorrow. There's not really anything you can do about that. You do need to think about your long-term financial plan and and how to secure that. That's a really positive note to end on, right?

Prediction 8: Influence will be more fractured and siloed

That's your last one. No, I've got one more that's, that's less depressing. Number eight, I think and this will be our final one.

We'll have more in our, our kind of pdf following up on this show, but it's just the idea that I think influences being fractured and, and siloed more and more. If you look at celebrity celebrities, you know, were pretty universal. You know, back in the eighties and nineties, you've got, you know, Michael Jackson and Michael Jordan and Madonna and these kind of celebrities who, they mean something to everybody and everybody is connected to them. But I think we're seeing from celebrity down to influencer that those audiences are getting smaller and smaller and sometimes more, more kind of rabid and more like invested in the creator or the celebrity. But those pockets are, are much smaller. We're not seeing as much like cross-generational influence as I think we used to see. And I think that's gonna continue to be a trend. And, and you know, we talk a lot about finding a niche, and I think that if anyone's starting out or you're looking for traction right now, I think there is no niche too small to start with.

You know, it's hard to go out there right now and be like, okay, I'm a lifestyle influencer talking about fashion, beauty, home travel. It's easier to be like, I just talk about loafers. I mean, that's a ridiculous example. I just thought, because today somebody asked me what loafers they should buy, but, you know, starting really, really niche, really small, you can expand out from there. You know, that influence is being fractured across this whole galaxy where it used to be combined into kind of like a one planetary system to continue the metaphor. Anyway, I think that's all for now. Thank you all again. As always, send questions or suggestions, and I'm gonna take a few weeks off, not from work unfortunately, but from doing the show and we'll see you all in the new year. Cheers.

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Cheers, and thanks for watching.

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