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If you’re exploring ways to make money online, you may wonder how Instagram works. Instagram is a free photo- and video-sharing app that lets you upload and share content with your friends and followers.
With enough followers and strong engagement, you can earn several hundred to many thousands of dollars a month on Instagram. Of course, it takes time and effort to make money on Instagram—whether your goal is a side hustle for earning passive income or a full-time gig. To help you get rolling, here are five ways to start making money on Instagram.
Five ways to make money on Instagram
Instagram isn’t the only way to make money online. If you’re in the market for new business ideas, you can also:
- Make money on Twitch through brand sponsorships, ad revenue, subscriptions, merchandise sales, donations, and Twitch Bits.
- Make money on YouTube through advertising revenue, channel memberships, product sales, and fan support.
- Make money on TikTok via brand sponsorships, influencer partnerships, merchandise sales, and the TikTok Rewards referral program.
- Make money on Amazon selling merchandise, publishing books, or giving product reviews and recommendations.
However, if you decide Instagram is the right platform for you, it’s essential to understand the various ways to monetize your content.
1. Collaborate with brands
Sponsored content is one of the best ways for smaller influencers to make money on Instagram. Influencers can help get a brand’s products and services in front of more people. And brands aren’t necessarily looking for influencers with millions of followers. Those with tight budgets may prefer partnering with smaller influencers with strong engagement and lower fees.
Most of these deals are negotiable and can range from a single post to a series of posts, stories, or reels highlighting the brand’s offerings. In exchange you receive free products or services, gifts, exposure to the brand’s followers, or cash (or some combination).
Influencers are broadly categorized based on audience size.
Here are the five tiers according to Shopify, along with the typical per-post earnings potential for each:
- Nano. 1,000 to 10,000 followers ($10 to $100 per post)
- Micro. 10,000 to 50,000 followers ($100 to $500 per post)
- Mid-tier. 50,000 to 500,000 followers ($500 to $5,000 per post)
- Macro. 500,000 to one million followers ($5,000 to $10,000 per post)
- Mega. More than one million followers ($10,000 to $1 million+ per post)
The more followers you have—and the greater your engagement (see “How Much Money Can You Make on Instagram,” below)—the more brands will pay you for sponsored content. If you’re large enough, brands may contact you with partnership offers. Otherwise you can join Instagram’s creator marketplace or reach out to brands that you can authentically promote and that fit your niche. Alternatively, you can use an influencer marketing platform to find opportunities and connect with partners.
2. Promote affiliate offers
Affiliates earn a commission on sales resulting from product tags in posts, stories, and reels. So, instead of being paid to generate brand awareness (as you do with brand collabs), you make money when your followers click trackable links or use promo codes to buy the products and services you promote. In exchange the brand pays you a small commission as a percentage or flat rate per sale.
Brands may contact you directly to gauge your interest in becoming an affiliate. Alternatively, you can reach out to one of the many merchants promoting affiliate programs or search online marketplaces for opportunities. Of course, mega-influencers (think Kylie Jenner) stand to earn the most as affiliates. Still, smaller influencers with loyal followings can enjoy modest returns through these commission-based programs.
3. Enable badges
You can earn money with Instagram badges if you have at least 10,000 followers and a business or creator account. Badges let your followers show their appreciation and support for you during live videos (think of them as tips). Once you enable badges via your Instagram profile, they’ll automatically be available during your live videos. When your viewers buy badges, you’ll see hearts next to their usernames.
Once you enable badges via your Instagram profile, viewers can buy them during your live videos in $0.99, $1.99, and $4.99 increments. You’ll see hearts next to their usernames, so you can thank them with shout-outs during your live video and afterward with “thank you” stickers in your stories.
According to Instagram, creators receive 100% of the revenue from badges purchased during a live video, minus applicable taxes, fees, and the 30% cut Google and Apple take for in-app purchases.
4. Sell your merch
If you have products or merchandise to sell, you can open an Instagram shop and start earning money. Once you open a shop (you’ll need a business or creator account to do so), shoppers can browse your catalog, check prices, learn about products, and make purchases directly on Instagram or by clicking through to your website.
To promote your shop, you can tag your products in reels, add shopping stickers to your stories, and tap into new audiences by letting other creators tag your products.
5. Enable ads on reels
After ending Instagram’s Reels Play bonus program earlier this year, parent company Meta announced that it’s expanding “Ads on Reels,” a performance-based monetization program available on Instagram and Facebook. According to the announcement, “With a performance-based model, creators can focus on the content that’s resonating with their audiences and helping them grow; advertisers get access to more ad inventory to reach more people; and people get a more consistent viewing experience with more relevant ads.”
The amount you earn is based on the number of plays your reels get (not by how much ad revenue you bring in), so the better your reels perform, the more you make. Meta is still testing the program, so it’s not widely available. You’ll need an invite from Meta to be included in the test group.
How much money can you make on Instagram?
Your Instagram earnings potential depends on four key factors.
- Follower count. The more followers you have, the higher your earnings potential. However, brands also want to see a good engagement rate. According to marketing tech firm HypeAuditor, influencers with 1,000 to 10,000 followers earn an average of $1,420 per month, while those with more than one million followers rake in about $15,356.
- Engagement rate. Engagement measures how people interact with your content through likes, comments, shares, and saves. If you have a small audience but great engagement, you can earn more than if you have a massive audience with no fan interaction. A common way to calculate engagement is to divide your total number of engagements per post by the reach (the number of people who view your content) per post and then multiply by 100. According to the social media management company Hootsuite, a good engagement rate is between 1% and 5%.
- Your niche. According to Sellfy, the 11 most profitable niches on Instagram in 2023 are, in descending order, travel, beauty, fashion, health and fitness, lifestyle, parenting, business, music, photography, food, and animals. Targeting one of these niches can make it easier to build a larger audience and land sponsored posts.
- Your reputation. A large following on Instagram certainly helps boost your earnings potential. However, many brands work with famous athletes, scientists, and other subject matter experts to leverage their offline reputations regardless of their online follower counts.
TIME Stamp: First, figure out the business end
Before you start making money on Instagram, it’s helpful to evaluate your options for handling the business end of things. Here are some areas to consider (with examples).
- Website and blog creation (e.g., SquareSpace).
- Business liability, formation, and paperwork (e.g., LegalZoom).
- Tax filing and preparation (e.g., TurboTax).
- Business banking (e.g., Lili).
By approaching your Instagram profile as a business, you can turn your hobby into a regular source of income supported by your engaged audience. Keep in mind that being active across multiple social media platforms and diversifying your content can help you reach and connect with a larger audience, maximizing your potential to make money online.
Frequently asked questions (FAQs)
How many Instagram followers do you need to make money?
Theoretically, you can make money with any number of Instagram followers. Still, the larger your audience and the better your engagement, the more money you can make. A good strategy, hard work, dedication, and a little luck also help boost your earnings potential.
Can I earn money from Instagram?
Instagram paid content creators through its Reels Play bonus program, which ran from late 2021 until it was discontinued on March 9, 2023. Meta is testing a new Ads on Reels program now, but it’s not widely available yet.
Instead of earning money from Instagram, creators can receive payouts on their earnings from Instagram’s monetization tools, including badges, branded content, gifts, and subscriptions. Most payouts are released around the 21st of every month for earnings made during the previous month.
How much does Instagram pay for 1,000 views?
With the end of the Reels Play bonus program, Instagram creators no longer cash in from views the way YouTubers make money. Instead, creators can use Instagram’s monetization tools and other strategies—such as brand collaborations and affiliate programs—to make money on Instagram in 2023.
How much does Instagram pay for 1 million views?
Instagram doesn’t pay creators directly for views, whether 1,000 or one million people watch the content. How much money you make on Instagram depends on the number of followers you have, your engagement rate, and the monetization strategies you use. Still, most influencers with more than one million followers charge between $10,000 and $15,000 per sponsored post, and top earners such as Cristiano Ronaldo and Kylie Jenner reportedly rake in upwards of $1 million, according to Hopper HQ, a U.K.-based social media planning and scheduling tool.
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