Just a comment on-- There was a New York Times article about influencers, it says- about not dismissing influencers and what my thoughts are there. If you haven't read the article, the technology reporter from The Times went to VidCon, had this article, essentially said, "Ignore influencers at your own peril. This is no longer a question of is it a bubble, is it a thing? This is the future." I think he spoke to a few things that we talk about on the show a lot. This is nothing new. He says, "This is not new, it's just that influencers used to be sports stars, and movie stars, and politicians, and magazine editors. Now they aren't. The world has always been controlled by influential voices, and it just so happens now that those influential voices are building their own platforms on these social channels."
He, I think, first explains the craziness of it. Again, he was at VidCon, so it's very young. It's a lot of TikTok people, it's a lot of YouTube people. It's just talking about this bigger global shift. Increasingly, every day, I feel more and more confident about the space. It is only growing every single day. The budgets are growing, there's more influencers, there's more platforms. I think what's really exciting now is this new class of influencer that's coming up, this younger person, so much different than what we're used to in the space. TikTok is bigger than Instagram already. It's got 1.3 billion users. That's pretty crazy.
Anyone watching this show probably is going to have a really hard time building a TikTok audience. I don't think you're doing meme dances, or whatever the fuck happens on TikTok. It's a really different platform. Brands are starting to spend money there so much faster than they did with Instagram. Instagram- even Snapchat, Snapchat was up and running for years and brands still weren't investing in it. TikTok has been around for like six months, it feels like, and brands are already starting to spend big money.
That's really interesting because I think a viable competitor to Instagram might be able to take market share away a lot faster than Instagram gained market share. The other thing that will be interesting with Instagram specifically is that as more people start to have access to shopping, I think in the next few months you'll see Instagram start to give a lot more people the ability to get whitelisted by brands that sell products.
As that happens, it will be interesting to see people's reaction like, "Do you want to open an app where you're just constantly getting sold shit? Is that what you want to do? Do you want to be looking through a stream that is essentially an e-comm stream." I'm not sure, but the commercialization of any platform opens up opportunities for ones that are less commercialized to come in and to start to take some mind share away, because while it's great for influencers, the normal person is going to start to get ad fatigue where they just get sick of of seeing advertisements and they run away from those.
Most people use these platforms to stay connected to their friends and most people's friends, their career isn't on these platforms and so they will go to the platform where it is most natural for them to just talk to their friends. Once that shift happens, you start to lose a lot of your following's attention because, again, most of your following is not built up of people whose livelihood depends on Instagram. As much as people love it, they will leave it very, very quickly and never look back. I think we are entering a atmosphere that is right for that, that is right for someone to come in and take some of this market share away.
As an influencer, it's a time to think about diversifying, it's a time to think about what you want to do with your future. You certainly should be looking to these other platforms and figuring out how you can be effective on them and trying to move your audience over as quickly as possible. If you're not on TikTok yet, go and try and see if you can do something there because in six months, it's going to be much harder to build a following there than it is today. These platforms, one of the ways they grow is they make it really easy for people to grow in the beginning and really easy to gain followers so that it gets harder for you to abandon the platform.
This is one of Snapchat's big mistakes, is that they made it really, really, really annoyingly, unbelievably- I don't understand why they did this- hard to grow your following and once you grew it, you didn't even know how many fucking followers you had. When Stories came along, it was just like, "Well, fuck this platform, they've done nothing for me, I've never made a cent from them and I don't even know how many followers I have. I'm fine leaving them."
I would just say stay vigilant. I am overwhelmingly positive about the space, but the industry is different than your career, the industry is different than Instagram or any one platform, and you have to understand that as money flows in to anything, the stakes get higher, it gets harder to be effective and there's going to be a lot more people trying to eat that pie. It is not a time to sit back and enjoy what's happening and not be hustling because once it clicks over, you might find it's too late. It's a little bit of optimism and pessimism, which is essentially my entire life, I guess.
I'm an optimistic realist. We've seen this happen before, this is not new. Go back to magazines, I don't have the stats, but my guess would be there was at least three or four times as many magazines in circulation 20 years ago as there was today. Now, do I think magazines or certain magazines will always be there? Probably. I don't see Vogue shutting down. Could, one day, if they fuck it up that badly, but they shouldn't. They should survive. GQ should survive. Vanity Fair should survive, The New Yorker should survive. These things shouldn't go away, but Teen Vogue, I don't know, is that still around? Maybe, maybe not.
All the international editions are closing. Influencers, it will be the same thing, we're in these- all these dollars are coming into the market. There's all these influencers and everyone can make a living. What will happen is there will be new platforms and money will go there, or new influencers and money will go there, and then there'll be a correction, and if this industry goes to $20 billion, it's probably at four or five right now. Let's say it goes to $20 billion, it would probably then settle back in at between $12 and $15 billion a year. That delta will mean a lot of people will have a hard time making a living.
You have to understand that markets are predictable and they act in the same way over and over again. If you know that and you're doing really well now, one, save your money, get a financial advisor, invest, understand that if you're an influencer and you're killing it and you're making half a million dollars, congratulations, but what happens if you make $75,000 dollars in three years and you have an apartment that's $8,000 a month. That's a little bit of an issue.
Think about your future while things are going well. It is much better to do that than to try and fix things once they've gone to shit. My last thing I'll say before we go, I'm already late for an event is, if you haven't done this- I think I've talked about this in the show before, but I will often, with Fohr, I make a list of everything that could significantly negatively impact a business, what I call existential threats, and this isn't a little one, this is terrible. Terrible things happening. My worst nightmare keep me up at night.
I list those things out and then I write down what I would do to fix it or what I could do now to avoid that even happening. If you do that, you can start to plan for these things because the things that can go wrong probably will go wrong, and if things are going awesome for you now, that is great, but most successful people, that their path to success is full of shit going wrong and failures and terrible times, the business almost close, whatever.
Make that list of everything that could ruin your business and what you would do to fix it and that can make you feel a little bit better. You realize there is a path out or you might realize, "I have the single point of failure where if this one thing happens, there is nothing I can do to fix it," and if that's the case you need to get really, really serious about changing that. We looked at a business two or three years ago and we realized 60% of our revenue was from one client, and that made me really, really uncomfortable. I said to the team, I said, "I want to get- by the end of this year-- Not the end of the year, I said, in the next 12 months, I want that number to be under 20%."
We got that number to under 20% and then that client dropped us completely. If I had not done that, if I hadn't said, "What is my point of failure here and what do I need to do to make sure if something changes that I'm okay." If we hadn't done that and we had just gone one business as usual, we maybe would have had to fire a bunch of people. It would have been a total catastrophe. I know that clients, no matter how much they love you, they're always leaving you. I saw this on Mad Men, I was like, "The day you close the client is the day you start losing them."
That's client services. That happens. You have to think about, "What am I going to do without this client? What am I going to do without Instagram?" Ask yourself that question. If Instagram closes today, do you have a plan? Do you have a plan B? Do you have a way to talk to those followers still or are you fucked? If you're fucked, that's okay because Instagram isn't going anywhere anytime soon, but in a year, in six months, you want to be able to answer that question and say, "That would be bad, I would lose a lot of money, but I wouldn't be ruined."
- Pre-launch hype, anti-bullying on Instagram, NYT article