How to Earn Money on Instagram in 2021 (1/2)

earn money on Instagram

Do you want to know how to earn money on Instagram? There are more methods than one.

Creators go where the money flows. Money is flowing in abundance from competitors’ creator funds, so Instagram is taking its role to add new income streams to the platform.

With an increasing number of creators ranging from sponsored content to viewers monetization, Instagram’s diversified approach may just make sense and money.

Right now, there are 4 main ways to earn money on Instagram:

  • Work as an Instagram influencer to publish content that is sponsored by brands
  • Be an affiliate marketer on Instagram and promote other people’s products on your account
  • Earn money for your content via tips and ads
  • Become an entrepreneur, promote and run your own brand

Explore more about new monetization tools, get inspired by examples from other creators, and find ideas that apply to all four tracks.

Can you earn money on Instagram?

Of course! Helping creators make money on the platform is a top priority for Instagram, especially as competition heats up from TikTok, Snapchat, and YouTube.

“Our purpose is to be the best platform for creators like you to make a living,” Facebook and Instagram’s top boss Mark Zuckerberg shared in June 2021.

Sponsored content and affiliated marketing remain the most effective ways for creators to earn on the platform. Now Instagram is putting efforts into high gear on the direct monetization front, where the company lags behind competitors.

New direct monetization efforts

Launched in 2020, Live Badges let followers support their favorite creators during broadcasts by giving hearts, which range from $.99 to $4.99.

Creators in choose markets can also earn a revenue share from IGTV ads.

During Creator Week, the company unveiled a native affiliate tool, new creator shop options, and bonuses for hitting milestones with badges and Live sessions. Instagram head Adam Mosseri also teased subscriptions, gated content, merch initiatives, and even NFTs. Tests on an incentive that may give creators bonuses for posting Reels are also currently underway.

Creator funds are not off the table, either. However, it’s unlikely that Instagram will hand out money as freely as YouTube (which plans to dole out $100 million over the next year to Shorts creators) or come anywhere near Snapchat’s payout rate of $1 million every day.

How much money can you make on Instagram?

The creator economy stays as unwieldy as the wild, wild west as far as rate standardization. The amount of money you can earn from Instagram depends on your audience size, engagement, and marketing strategy.

Unfortunately, racism also impacts how much creators earn on Instagram. Accounts like @influencerpaygap aim to decrease the pay rate gap by bringing transparency to how much creators are paid.

Here’s how much money some creators and celebs have reported that they earn:

  • $250-$300: The average amount of money a micro-influencer gets on a single sponsored post.
  • $300: The amount a micro-influencer with 13K followers, reportedly revenue on sponsored Reels.
  • $750 to $1,000: The amount “plant influencer” Nick Cutsumpas (@farmernicknyc, 63K+ followers) gets for a sponsored post (up to three slides). For IGTV videos between two and three minutes, he charges $1,500.
  • $8,500: The amount “robot influencer” Lil Miquela (@lilmiquela, 2.5 million followers) reportedly gets for every sponsored post.
  • $102,000: @goldenretriever’s projected annual revenue on Instagram in 2020 with 1.9 million follows.
  • $275,000: The amount Kendall Jenner was paid in 2017 for only one Instagram post to promote the Fyre Festival. She later paid a $90,000 settlement for misleading and never meeting ad regulations.
  • $1,015,000: The amount The Rock reportedly earned for one sponsored post in 2020.

How to earn money on Instagram

Strategy 1: Partner with a brand

Instagram is making a marketplace to help brands and creators discover each other. Meanwhile, eligible creators can keep using monetization tools in Brand Collabs Manager, collaborate with an influencer agency, or find out about relevant brands.

Brand Collabs Manager is out there to Instagram creators in the U.S. who have:

  • Active Business or Creator accounts
  • 10,000+ followers
  • 100+ hours of view time on original videos or 1,000 engagement (include likes and comments) in the last 60 days
  • No history of content violations

Search for brands that align with your interests, values, shopping history, and the niche you’re working in.

“Find out the way to add the brand in a video you’re already planning,” @chazsmith recommended on the Instagram website. Brand partnerships always work better when they’re genuine.

An increasing number of brands like Sephora or Lululemon also work with rising influencers to ambassador programs. Do your research. If you think you’d be a great fit with a brand, it may be worthwhile to apply, especially if it leads to a long-term partnership.

Strategy 2: Leverage affiliate links

Affiliate marketing helps influencers to earn commission from the sales they inspire.

How does it work? Traceable links and promo codes added in posts, Stories, or Instagram bios will help brands track influencer referrals. Commission can range from 10-20%, depending on whether the partnership includes a pay-per-click or cost-per-acquisition model.

Influencers interested in affiliate marketing can be a part of affiliate networks such as CJ Affiliate, Pepperjam, ShareASale, or Rakuten. Brands such as Glossier, Mejuri, and Rent the Runway create their own affiliate programs.

Instagram will begin testing a native affiliate tool with creators in the US and a group of famous brands that include Benefit, Kopari, MAC, Pat McGrath Labs, and Sephora this year. This tool will allow creators to search out, share, and earn commissions on products available on Instagram Checkout.

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