Today is the first class in our new May class period. Our material today is about influencers. I have included a transcript. Please listen and follow along.

SYLVIE DOUGLIS, BYLINE: NPR.

(SOUNDBITE OF DROP ELECTRIC SONG, "WAKING UP TO THE FIRE")

KENDALL HOYT: I think you need to lose the hat.

DARIAN WOODS, HOST:

Lose the hat? OK.

HOYT: Let your hair flow.

WOODS: All right. So, Wailin, Kendall Hoyt is a fashion influencer. She's got a focus on goth-adjacent vintage looks, half a million followers on TikTok.

WAILIN WONG, HOST:

Goth-adjacent vintage? I am intrigued.

WOODS: And to investigate the economics of influencers, I wanted to see how they spent and earnt their money.

So here we are in Beacon's Closet.

So Kendall and I went to a secondhand clothes store in Brooklyn, and she offered to style me.

WONG: I am so jealous you got to go vintage shopping with an influencer, Darian.

WOODS: It was a lot of fun.

HOYT: OK, I like the vibes of this - fun horse girl graphic (laughter).

WOODS: Horse girl, I love it.

So first was the T-shirt rack.

HOYT: Living her fantasy. She's free-spirited.

WOODS: Living her horse life.

HOYT: (Laughter) Yeah.

WONG: Please tell me you got the horse T-shirt.

WOODS: I did, of course. And next in my journey to learn about becoming an influencer - pants.

HOYT: I want to find, like, a '70s, like, flair or, like, a straight leg...

WOODS: It's time to ditch the skinny jeans.

HOYT: Ditch the skinny jeans. Oh, these look nice - flares. This is flared.

WOODS: OK, flared blue jeans.

So I tried them on.

HOYT: You look good.

WOODS: Let's take this to the register. I'm going to...

HOYT: Are you serious?

WOODS: I'm ready to purchase.

HOYT: OK, great.

WONG: Wow. So you got a whole new outfit?

WOODS: That's right. And it was pretty affordable.

UNIDENTIFIED CASHIER: All right, 33.90 is going to be your total for the both things. Whenever you are ready, just go ahead and tap. Do you want a receipt?

WOODS: A receipt would be great.

UNIDENTIFIED CASHIER: OK.

WOODS: All right.

HOYT: I hope you're expensing that (laughter).

WONG: Of course Kendall knows these clothes are a business expense - right? - if she's a fashion influencer.

WOODS: Absolutely. And for this episode, we are combing through Kendall's finances and, really, the finances of all influencers, a full accounting of the influencer industry.

(SOUNDBITE OF MUSIC)

WOODS: This is THE INDICATOR FROM PLANET MONEY. I'm Darian Woods.

WONG: And I'm Wailin Wong. Today, for our influencer series, we explain the economics of influencing.

(SOUNDBITE OF MUSIC)

WOODS: Kendall Hoyt makes short videos on TikTok and Instagram, where she dresses in different outfits, mostly thrifted or secondhand.

(SOUNDBITE OF ARCHIVED RECORDING)

HOYT: Today, I'm going to be showing you how to dress like a Vivienne Westwood model.

WOODS: And as far as style, Wailin, I'll just show you some of her videos.

(SOUNDBITE OF ARCHIVED RECORDING)

HOYT: Then add either a corset...

WONG: OK. I see her feed now. OK, so you weren't kidding about the kind of goth vintage-adjacent 'cause I see a lot of black here.

WOODS: Yeah. Black, a little plaid. And a lot of other people are into it, too. Like, with half a million followers on TikTok, that puts her squarely with the kind of following that the industry counts as an influencer.

WONG: Right. It's, like, below 100,000 followers and you're considered a micro-influencer, and then above a million followers, that's reaching celebrity status.

WOODS: Exactly. And so to get the audit of her accounts, I asked her how much she spent every month.

HOYT: For me, it is mostly clothes and fashion. So I'm probably spending a couple hundred dollars a month just accumulating new things. But I also get gifted a lot now from brands.

WONG: OK. So a couple hundred dollars a month - that's over $2,000 a year on clothes and stuff. That's a lot of horse girl T-shirts.

WOODS: And aside from clothing expenses, there is also the longer-term capital investments. So, for Kendall, it's an iPhone, laptop, tripod. So add another couple of thousand on top of that.

WONG: I always think about the time, like, just the sheer amount of hours that you have to spend editing and making these videos so that they look really good.

WOODS: Yeah. So Kendall is not a full-time influencer yet. She still has to work a day job working in advertising. And I asked her how much of her spare time she manages to squeeze into her influencer work.

HOYT: Many. It's most of my free time I spend making content - 10, 15 hours extra a week.

WONG: OK. But then you know what I really want to know and what I bet a lot of our listeners want to know - how much does Kendall get paid?

HOYT: So for 2022, I made about $15,000, which maybe is less than you'd expect hearing some other large influencers.

WONG: OK. So $15,000, and then after she subtracts her expenses, that probably leaves her with 11- or $12,000. It's pretty good for a side hustle, right?

WOODS: Yeah. I mean, for a part-time job, not bad. If you want to make it full-time, that's probably not enough to live on in New York City, though.

WONG: Right. I mean, I guess I'm seeing now that gap, where, if you want to try to make this into a full-time thing, that's a pretty big mountain to climb.

WOODS: Yeah. So I spoke to an expert in the industry, Ryan Hilliard, to see if this was typical. Ryan is a general manager at a company called HypeAuditor, which analyzes influencer data. And he says you need a lot of followers for a comfortable cash flow.

RYAN HILLIARD: There's kind of a magic number where it becomes, I can do this for a living, and that's probably close to that, I have a million followers.

WOODS: And there's only a tiny share of influencers who reach that level.

HILLIARD: Less than 1%. It's just too hard. There's too many other people doing similar stuff.

WOODS: Now, first, keep in mind that the amount you can earn varies wildly from influencer to influencer. Like, you know, how loyal are your followers? Do they click on the links that you suggest? Are your followers mainly on YouTube or Instagram or TikTok? And also, what kind of influencer are you?

WONG: Right. Like, are you a fashion influencer, cooking, golf?

WOODS: Exactly. And it's also the question of what are the demographics of your followers? Like, are they higher or low income? These things all make a difference. Now, the second thing to think about with Ryan's numbers is that, of course, everybody's definition of what counts for enough to live off varies. So let's focus on Kendall. By Ryan's calculations, she could be comfortably earning $65,000 a year, maybe even a hundred grand.

WONG: Oh, $100,000. Wow. That is such a difference.

WOODS: Yeah. And to understand why, you need to look at how influencers make money.

WONG: Are we talking spon con?

WOODS: Spon con exactly. Hashtag ad - these posts on TikTok or Instagram where the influencer showcases a new bag or a skirt, captioned paid partnership. Kendall Hoyt charges $4,000 for a single TikTok post, and Ryan says that, based on his surveys, about 80% of influencers' revenue comes from these paid posts. And a typical influencer might make one or two of these a month. Next up, to get money, another 10 to 15% of influencers' revenue comes from affiliate links.

WONG: Oh, right. So this is where a viewer might click on a link on the influencers' profile to buy something, and then the influencer gets, like, 10% of that sale.

WOODS: Or there's, like, an offer code, and they get a cut. And there's a third way for influencers to earn money, and that's through exclusive content that people subscribe and pay for.

WONG: Like PLANET MONEY+.

WOODS: Thanks for the plug, Wailin. And while some influencers might even earn all their money through subscriptions, the influencers that Ryan has surveyed only actually earn a small amount this way.

WONG: OK. So given all of that, why are Ryan's numbers so much higher?

WOODS: Ryan says he can basically divide influencers with large followings into two categories, ones that are actively working with companies for sponsored posts and ones that aren't.

HILLIARD: You still have to find brands to partner with. So, like, one of the things that we've asked creators is, like, how much time do you spend on managing your accounts? And people that don't try to monetize, it's usually less than 20 hours, and people that do try to monetize, it's more than 30 hours.

WOODS: So on top of her day job and actually building her following, Kendall says she doesn't have time to proactively reach out to brands to work with. So she's kind of in this bind right now. She's got no time to reach out to companies, but if she does quit her day job, she wouldn't have any sponsors lined up.

HOYT: Like, who wouldn't want to just post a video to make thousands of dollars? But there's a lot more that goes into it to build up a community and be able to get those deals.

WOODS: You know, Wailin, even with these sobering statistics, I figured maybe I might try my hand at influencing. So Kendall helped me with that new look and gave me posing tips.

HOYT: Relax the eyebrows, and slightly, like, part your lips like - (laughter) yes, this is so good. All right, straighten up. And then you could, like, tousle your hair.

WOODS: OK.

HOYT: There you go.

WOODS: Little tousle.

HOYT: Slow. How do you feel?

WOODS: I feel a little unusual. I've never tried to relax my eyebrows before. I realized I have such tense eyebrows.

HOYT: (Laughter) Got to get some Botox.

WONG: So, Darian, did you get some Botox?

WOODS: I did not.

WONG: (Laughter).

WOODS: Another expense, come on. But, look; here's the photos before and after.

WONG: Oh, wow. Darian, you look so great. I see the horse girl T-shirt and these new jeans that are no longer skinny jeans. But you honestly look great. I think she did a wonderful job.

WOODS: You got to go shopping with an influencer before you die. It's - like, it's compulsory.

WONG: Gosh, I want a do-over. Yeah (laughter).

WOODS: There's still time (laughter).

WONG: Or maybe I'll go get Botox with an influencer. I mean, the possibilities are endless, really.

(SOUNDBITE OF MUSIC)

WOODS: Tomorrow, we're going to look at why being an influencer is such a popular career choice for young people. Stay tuned.

This episode was produced by Corey Bridges and Janet Lee. It was engineered by Robert Rodriguez. It was fact-checked by Dylan Sloan. Viet Le is our senior producer. And Kate Concannon edits the show. THE INDICATOR is a production of NPR.