fintech: A new reality sets in for find-influencers
As the global economic scenario is reset and startups focus on revenue and expenses, the marketing budgets of these companies are cut. As a result, the flow of contracts and the income of the financiers has fallen by 30-40%, according to half a dozen influencer marketing agencies and creators ET spoke to.
A legion of individuals took up full-time content creation after the pandemic. Among the new generation of creators, the boom in finance and business creators stood out, as ET reported last year, due to the funding frenzy in fintech and crypto startups, as well as a market bulk that drove interest among Gen Z.
During the peak boom of 2021, a financial influencer with over one million followers on Instagram earned 12-18 lakh Rs a month for brand campaigns, according to two digital marketing leaders.
“There were a lot of fintech startups that were completely online. These brands raised millions or billions of dollars. Then they had to show download numbers, so they approached creators and started paying per impression “, said Neha Nagar, a financier on Instagram with over a million followers.
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At one point, for 1 million views on a reel, brands paid up to Rs 5 lakh to creators.
Buy-now-pay-later players, expense managers, new banking and online brokerage firms and crypto exchanges have now cut back on promotional expenses. While online brokerage firm Groww has slowed down influencer marketing, VC-backed crypto-trading platforms CoinDCX and Coinswitch Kuber have either canceled old deals or stopped new ones since February, industry insiders said. Nearly 10 people have left WazirX’s marketing department, citing a lack of reviews in recent months and budget cuts, they said.
There is increased pressure on crypto exchanges after their advertising flash sparked an investigation last year by the government and led to the creation of guidelines for marketing cryptocurrencies from the Advertising Standards Council of India.
A CoinSwitch spokesman said the company had always been frugal. “Businesses want to reconsider budgets and spending, and that’s pretty clear now. However, this is the best time to dig in and build,” the spokesman said.
WazirX, CoinDCX and Groww did not respond to emails seeking comment before press time on Thursday.
“Overall, markets are down, crypto is down, fintech funding has slowed down. That effect has definitely moved us. It’s a very proportionate thing,” said Ayush Shukla, founder of Finnet Media, which manages around 20-25 financial creators. “A lot of scrutiny has come in. If last year it took three days to close an agreement, it now takes one to three weeks. Things will be especially difficult for medium-sized and small creators, “he added.
Along with longer contract closures, brands are pushing in more deliveries for the same amount, according to digital marketing agencies. For the best financiers who have made money through affiliate marketing, the revenue has taken a hit. Each time a user clicked on an influencer’s affiliate link and made a trade, influencers received up to 40% of the brokerage fee. Now it has gone down, and last year’s beef race is coming to an end.
Change of appetite
Nothing encapsulates the changing tide in the market more than what viewers are turning towards. While last year’s content focused on how to read a draft red herring prospectus and why investing in crypto is a good alternative, this year the creators are talking about stagflation, why the market crashed, or how to protect your capital.
Influencers who created a niche in crypto shifts are experiencing setbacks from users who joined the crypto wave during last year’s bull run. Now their portfolios are down by at least 40-70%.
In addition to companies cutting budgets, the fall in stock prices globally – with technology stocks taking a significant beating – has also shifted the need for content focused on “keeping” investors through the changing scenario.
«Dynamic updates are much more in demand. Can you predict what will happen today? Day-to-day handhelds are in demand because people are nervous, says Pranjal Kamra, a financial youtuber and CEO of Finology, a financial consulting firm. “The new investor has not seen the cycle. Half of their capital was in crypto. They are the ones who find it especially difficult for them to deal with this, and that is why the content is changing. ”
Constant experimentation is the name of the game, say the creators, with Instagram’s ever-changing algorithm working for the benefit of newer creators. Content on discounts also gets more eyes, the creators said.
In the past, Instagram financial influencer Ashna Tolkar has focused on basic and technical content. She now makes Reels on real hacks and also increases her presence on YouTube.
“Very technical content does not get as many views, especially from newer audiences. In the past, I put a lot of pressure on educational content, and since I was an upcoming creator, the Instagram algorithm supported me. Content that has a hook or something where the potential for shareability is higher , gets more views, said 20-year-old Tolkar.
The way forward
In the new reality, creators are exploring several options: Instagram creators who joined during the Reel boom are focusing on increasing their YouTube presence and doubling down on YouTube shorts. Launching paid courses and adding another language to their content arsenal to compensate for the reduced revenue, or negotiating long-term partnerships with brands instead of one-time posts, are also options that creators are exploring.
“Now that few agreements come in and only large established companies make ads, many creators switch to paid courses. Now only the good and serious ones will remain, the rest will disappear since it is no longer financially attractive,” said financier Shashank Udupa, who plans to launch an investment course in September this year.
Vimal Rathore, founder of Qoohoo, which allows creators to monetize their communities, said the demand for paid courses led by finance remained high. “The Covid era made so many young people interested in stocks and other financial instruments. They use this downturn to learn deeply by subscribing to various courses, mentorships and sessions,” Rathore said.
