Did you know you can monetize Instagram? Yep, spending all that time on your favorite social media network can literally pay off!
Instagram has more than 500 million daily active users. That is half of a million people every day who can potentially be persuaded to make a purchase based on what they see on Instagram. As brands big and small realize the potential of Instagram as a marketing platform, they are depending more and more on Instagram leaders who know how to engage their audience and convince them to spend.
That’s good news for anyone who dreams of making money via social media platforms. In this article, we break down the seven best ways to monetize your Instagram account, who is most likely to make money on Instagram, and the first steps you can take to get started.
Who Can Make Money On Instagram?
While just about anyone has the potential to make money on Instagram, there are some things you will likely need before you’re able to cash any paychecks.
The Instagrammers who find the most success at monetizing their accounts are those with larger, engaged audiences. Engagement is especially important because followers are most likely to be influenced by those they trust and whose content they find valuable.
Typically, there are three things you will need before you are able to successfully monetize your Instagram account:
Those who make money on Instagram generally have at least 1,000 followers. Interestingly, a recent HBO documentary found that it was possible to make a decent income with as few as 5,000 followers (and about 300 sponsored posts, but more on that later).
Instagrammers with fewer than 10,000 followers are considered nano-influencers, while those with more than 10,000 are referred to as micro-influencers. Macro-influencers are those with 100,000+ followers.
Because just about every proven method for monetizing Instagram requires the participation of your followers, earning large numbers of followers is very important.
2. An Engaged Audience
But the simple number of followers is not everything. In order to be successful on Instagram, it’s important to have a positive engagement rate.
Most social media experts agree that an impressive engagement rate is 1% to 5%. This means that 1-5% of all of your Instagram followers are liking, commenting, sharing, saving, or otherwise interacting with your content. Those who will pay you for your content want to know that your followers enjoy your account and will engage with what you are ultimately trying to sell.
Pro Tip: The significance of an engaged audience cannot be underestimated. Therefore, it’s important to grow your number of followers organically through an aesthetically pleasing profile, clear niche, and high-quality content. Buying followers is typically frowned upon, and does not result in engagement of any sort.
3. A Niche and High-Quality Content
A clear niche and high-quality content are musts, as these are what influence potential followers to press the “Follow” button and engage with your content. A niche is what your Instagram account is about, and it should be as specific as possible.
Contrary to popular belief, “Lifestyle” is not a niche -- though “being an entrepreneur and stay-at-home mom to a child with autism” is. Similarly, “Travel” is not a specific enough niche -- though “full-time traveling on a budget of $1,000 per month” can be.
Having a solid, clear niche will better communicate to followers and potential partner brands what your account is about. Similarly, you need high-quality content that relates to your niche. High-quality content can be aesthetically pleasing photos, captions that encourage comments and likes, and content of all kinds that inspire or teach.
How To Make Money on Instagram: The 7 Best Methods
Now that we’ve covered the prerequisites for monetization, let’s look at the ways in which Instagrammers can earn money. Broadly speaking, there are two ways to make money on Instagram: influencer marketing and self-promotion.
Influencer marketing is when an Instagrammer works with brands to promote products in a variety of ways. Self-promotion is when the Instagrammer markets his or her own products.
Keep reading for seven proven methods for monetizing your Instagram account.
1. Affiliate Marketing
One of the easiest and most popular ways to make money on Instagram is affiliate marketing. Affiliate marketing is promoting a brand’s product in exchange for a commission. Generally, Instagrammers create posts, Stories, Reels, and other content around a product they believe in, then share a discount code that their followers can use to purchase the product for themselves. Whenever someone uses the link to buy the product, the Instagrammer receives a percentage of the sale.
2. Product Placement
If you’ve ever been watching a movie or television show and noticed a branded box of cereal sitting on the counter facing the audience, or heard a comment about the features of the car in which the characters are driving, then you’ve experienced product placement. Product placement has been a successful method of advertising for decades, and it’s now being used by influencers to monetize their Instagram accounts.
Influencers work with brands to organize product placement campaigns. They then create Stories, Reels, and other content subtly featuring the product. Product Placement is similar to Affiliate Marketing, but instead of receiving a commission for every advertised product purchased by a follower, the Instagrammer is paid a flat fee for advertising the product.
3. Sponsored Content and Shoutouts
Sponsored posts and shoutouts are similar to both product placement and affiliate marketing. Usually limited to those considered micro- (10,000+ followers) and macro- (100,000+ followers) influencers, a sponsored post is a carefully designed pic, Story, Reel, or IGTV that features the influencer using and discussing a specific product. The content usually includes the influencer’s review or opinion of the product, too.
To organize sponsored posts and shoutouts, content creators pitch their personal brand to companies large and small. If the influencer matches the type of buyer a company wants, then the two parties will agree to price and content.
4. Teach Something
More and more influencers are making money on Instagram by teaching something they know to the social media masses. Quite a few Instagrammers make a living by teaching their followers something related to their niche. They usually post helpful content, then sell an additional course or ebook.
Some influencers who have found success through this method teach their followers how to get their baby to sleep through the night, how to restore and decorate old houses, or how to style their curly hair. Still, others who have become successful on Instagram further monetize their accounts by becoming Instagram marketing consultants.
These gurus help aspiring influencers maximize their potential through online courses, one-on-one mentorships, ebooks, and more.
5. Instagram Live Badges
One of the newest ways to monetize an Instagram account is through Instagram Live badges. This recently added feature allows followers to reward their favorite influencers by “tipping” them during Instagram Live sessions. Followers, or live viewers, can purchase heart-shaped badges for between $0.99 and $4.99. They then offer their badges to the Instagrammer during a Live.
Needless to say, an Instagrammer needs a lot of engaged followers in order to make this profitable. An influencer will need to create consistent, engaging content that they can present live. Then they will need enough followers who are interested in tuning in live and satisfied enough to pay for the information they are receiving.
6. Create Presets
Instagram is a social media network that rewards aesthetically pleasing content. Potential followers decide to follow an account based on its photo grid, so Instagrammers need to make sure their photos are visually appealing.
One way an Instagrammer can make their photos look high quality and appealing is through presets. Presets are pre-set Adobe Lightroom photo edits. One can upload their photo into the Lightroom app, then use a preset to instantly edit the photo’s lighting and color. Using the same set of presets on all of their photos ensures the photo grid on their profile page looks uniform.
Entrepreneurial Instagrammers can make money by creating and selling sets of presets. You will need some good photos, an eye for visuals, and some photo editing skills, but once you create your presets, selling them can be a good way to create consistent passive income. This method also applies to other digital products, too, such as ebooks, printables, music, and more.
7. Advertise Your Own Products
If you have your own business or company, then you can also use Instagram to advertise your products. This is a popular method of monetization because it’s a method that works across niches and industries. For example, an interior design or home renovation company can attract potential clients by creating high-quality Instagram posts and Stories that show their work or inspiration.
Said interior design company can go further by creating their own furniture, textiles, and other decor pieces to sell to their followers. Instagrammers who sell skincare products, books, travel packages, or other multi-level marketing products also find great success advertising their products through their accounts.
Similarly, those in e-commerce can act as their own marketer using their account, video content, strategic hashtags, and more. Instead of working with a larger brand, those who monetize their Instagram accounts through this method are the brand.
Frequently Asked Questions About Monetizing Instagram
1. How much money can you make with 1,000 Instagram followers?
If you have 1,000 highly engaged Instagram followers, then you may very well be able to find a brand that will work with you. However, nano-influencers mostly receive free products or services instead of money. On the other hand, those with around 100,000 followers and a decent engagement rate can earn between $250 and $500 for each sponsored post, Story, or Reel.
2. How many views do you need to make money on Instagram?
The number of views you receive on your Instagram Stories and Reels is less important than the number of viewers who interact in some way with your content. Getting people to engage with your work -- that is, encouraging likes, shares, saves, comments, and messages -- is what sells a brand on your account. Typically, brands want to work with Instagram influencers who have an engagement rate between 1% and 5%.
3. Is it easy to make money on Instagram?
In the grand scheme of things, few people make enough money on Instagram to make a full-time living. However, as social media becomes more and more powerful as a vehicle for advertising, earning some kind of money is not as difficult as it once was. Those who make the most money on Instagram are those who post consistently, spend time engaging with similar accounts, create more than they scroll, and are willing to evolve with the platform.
4. How many followers do you need to make money on Instagram?
There are opportunities to make money with as few as 1,000 followers. But having engaged followers who consistently interact with your account and content is far more important than the follower count.
5. How can I make money from my Instagram account?
Instagram is constantly evolving, and there are always new ways to monetize an Instagram account. Currently, the best ways to make money on Instagram include:
Sponsored posts and shoutouts
Instagram Live badges
Advertising your own products
6. Who is the highest-paid Instagrammer?
As of July 2021, the highest-paid Instagrammer is Portuguese soccer star Cristiano Ronaldo, who earns as much as $1.6 million every time he posts. Dwayne “The Rock” Johnson and Ariana Grande rank 2nd and 3rd, making $1.52 million and $1.51 million per post, respectively.
The Bottom Line
These days, few people make money the way their parents did. Social media outlets like Instagram have proven a great way to create income, whether as a side hustle or as a full-time job. Though the industry is always evolving, current methods of monetizing one’s Instagram account include affiliate marketing, sponsored posts, and creating and selling one’s own products.
Contrary to popular belief, one does not need tens of thousands of followers in order to turn likes into cash. However, some things -- such as a growing follower base, a positive engagement rate, and a commitment to high-quality content -- are a must. Focus on those three things and you are bound to end up with a revenue stream.