Influencer marketing is the fastest-growing marketing channel at the moment. Money has left many traditional channels and is flowing towards influencers and the influencer marketing agencies who create high-ROI campaigns.
Table of Contents
- Influencer Marketing Growth Trends
- Growth Trends For Paid Ads
- Benefits Of Influencer Marketing Over Paid Ads
- Increased Authenticity
- Targeting
- Campaign Flexibility
- Authority Building
- Live Event Coverage
- Giveaways
- Engagement
- SEO Benefits
- Ongoing Brand Influencer Partnerships
- The Benefits Of Paid Ads
- Easier To Track Results
- Instant Results
- Adjust Campaigns On The Fly
- Easier Campaign Creation
- Scalability
- Which Is Better: Paid Ads Or Influencer Marketing
- Which Marketing Method Has The Highest ROI: Influencer Marketing vs Paid Ads
- Deciding Which Marketing Option Is Right For You
But while influencer marketing is now proven to be so successful, what role do paid ads play in a comprehensive digital marketing strategy?
It’s a great question because no brand or company has unlimited resources. We all have marketing budgets that place a ceiling on what we can spend. We want to use those limited resources in a way that gives the highest possible return.
Paid ads are still a very strong component of digital advertising, but in this article, we wanted to look at how they compare with influencer marketing options in different scenarios. This includes looking at the pros and cons of each marketing channel. It also includes diving into situations where each option is more appropriate.
In this guide, we’ll help you understand the nuanced differences when it comes to influencer marketing vs paid ads. By the end, you should have the information you need to properly allocate your marketing budget to get the best results possible.
Influencer Marketing Growth Trends

The fact that such a large portion of advertising spending is moving toward influencer marketing is not a random phenomenon. Brands are seeing huge returns and that has led to the overall influencer marketing size to triple since 2019.
According to Statista, influencer marketing is now a $21.1 billion industry that is continuing to grow and will be even larger by the end of 2025. What’s interesting is that this growth is spread across established platforms such as YouTube as well as newer platforms such as TikTok.
The growth is also spread across industries. On platforms such as YouTube or TikTok, we know that subjects such as entertainment, fashion, music, and video games make up the largest percentage of influencers. However, the growth of influencer marketing has touched almost every business niche to include B2B and even scientific fields.
This broad-based growth shows that influencer marketing is set to be a long-lasting channel that is appropriate for virtually any category or industry that has a presence on social media.
Growth Trends For Paid Ads
Paid ads were the original advertising channel that fueled much of the internet’s early growth, along with the fortunes of several tech companies such as Google (Alphabet). Today, almost every large platform has its own paid advertising program that can be used to reach various audiences.
PPC search ads alone are a $190 billion industry and have grown on a solid trajectory for over a decade. This doesn’t even include in-line ads and other types of advertising available on social media platforms.
So while paid ads currently dwarf influencer marketing spending, the faster growth is in influencer marketing spending. However, paid ads in most cases have far more history that marketers can use to fine-tune campaigns and make projections.
Years of PPC data allow skilled digital marketers to make extremely accurate forecasts regarding ROI and expected traffic. In some ways, this makes PPC and paid ads less risky for certain campaigns.
The bottom line is that both influencer marketing and paid ads are growing and one is not necessarily cannibalizing the other. Instead, they are being used synergistically or being used exclusively when appropriate for a marketing campaign’s specific goals.
With that being said, let’s dive into the pros and cons and other differences between these channels so you can decide which options fits your scenario the best.
Benefits Of Influencer Marketing Over Paid Ads

Both influencer marketing and paid ads have their own benefits to suit a campaign. In this section, we’ll look at what influencer marketing can do that paid ads generally can’t.
Increased Authenticity
This is probably the most significant positive attribute of influencer marketing over paid ads. The authenticity that’s possible with influencer marketing is very similar to a celebrity endorsement from years past.
It’s a trusted individual that the audience respects talking about your specific product or brand. In that regard, influencer marketing is far superior to paid ads. Paid ads are limited by the creativity of the messaging and how attention-grabbing it is.
While that can work to get your message in front of people, it’s not enough to always push audiences over the top to follow a call-to-action or to make a purchase.
Another thing to consider is that many niche influencers also have hundreds if not thousands of Patreon subscribers. These are followers who pay a monthly fee just to support the influencer. This shows how dedicated an influencer’s audience can be and that loyalty translates when they partner with your brand.
Of course, taking full advantage of this authenticity requires careful selection of the right influencer and the right campaign strategy. But when executed correctly, the authenticity that’s possible with influencer marketing is one of its greatest strengths.
Targeting
Both paid ads and influencer marketing provide strong targeting options. With paid ads, this is generally done through keywords or based on the browsing history of the target audience.
The problem with this is that it’s not always exact. The reason certain people search for something or browse something isn’t always clear. However, with paid ads, your ads will show up regardless of the user’s intention.
The result is that with strict targeting, paid ads generally perform well. But once you try to expand the reach or scale them, the ROI may quickly drop off as you start exposing the ads to less targeted audiences.
Influencer marketing allows for much tighter targeting between niches and even within individual niches. For example, an influencer who provides product reviews of cosmetics has an extremely targeted audience.
If you want to scale the reach, you can find similar influencers who make similar review content. You expand the reach and your targeting remains mostly unchanged.
Scaling influencer marketing compared to paid ads and the return is generally going to be higher with less trial and error.
The same caveat applies though and careful influencer marketing campaign planning is necessary to scale effectively and profitably.
Campaign Flexibility
Influencer campaign flexibility is another strong benefit of influencer marketing. Brands are using influencer marketing for everything from driving sales of DTC products to finding venture capital investors for tech startups.
Paid ads are more limited in the types of results you can expect from them, at least within a reasonable amount of time to keep your ROI in check. For example, many large brands can run certain PPC campaigns at a loss to help with brand awareness. However, most brands don’t have the resources for that kind of marketing spend.
Below are some campaign types that influencer marketing excels at compared to paid ads
Authority Building
New brands or brands entering a new market often struggle with building authority and credibility. Paid ads can work for this, but it’s time-consuming and the ROI can take months or years.
When done correctly, influencer marketing can immediately enhance a brand’s authority within a space, even if it’s a totally new brand. By partnering with the right influencers, a brand receives an instant boost of authority, especially if the campaign is across different influencers and platforms.
Many brands are leveraging this today by blanketing different platforms when they launch. Suddenly, it seems like everyone is talking about a new brand and people instinctively want to learn more.
It helps build credibility and brand authority at the same time, along with other benefits.
Live Event Coverage
Influencers are being used to boost exposure during live events and the results are extremely positive. A perfect example is brands using beauty influencers during Fashion Week or other hot industry events.
Influencers providing live coverage for a brand can immediately help them dominate hashtags during the event and gain far more exposure than a traditional ad or media blitz.
Beyond just fashion, B2B brands are also using influencers for live coverage of trade shows. Trade shows get far less buzz than events like Fashion Week, so using popular influencers can suddenly make a somewhat boring trade show relevant across social media.
These are just two examples, but there are many ways to use influencers for live event coverage that provide substantial reach and brand awareness benefits.
Giveaways
Brands have giveaways all the time, but when these are handled through influencers, the giveaway or content gets far more authentic engagement.
Influencers can ask their audience to create their own content related to the product or brand being promoted, which increases engagement and reach. It also helps with hashtag use as that’s generally something that’s required to enter the influencer giveaway.
Partnering with an influencer takes a giveaway off of your website and puts it in front of a receptive audience.
Engagement
When it comes to engagement, influencer marketing performs far better than any type of paid ad. With influencer marketing, engagement is defined as any time a user interacts with your piece of content. This can be a comment, a like, or a share.
It also goes beyond that with UGC (user-generated content) or other actions common on social media platforms.
With paid ads, the interaction is often limited to the user being presented the advertisement in their feed or on a webpage and then whether or not they click on it. Following the call-to-action in a paid ad does lead to additional engagement, but the process is less of a total investment for the user. If the landing page is not optimized, you can lose that user rather easily.
With influencer marketing, the user has likely invested more time with the content containing your marketing message. This causes them to take an extra moment when they do follow a call-to-action to absorb the message and make a decision.
Essentially, engagement increases the time users spend with your marketing message, and influencer marketing tends to have higher engagement potential than paid ads.
SEO Benefits
Most social media content tends to appear in search results due to its popularity. This means that the influencers you have partnered with will show up when users search for various topics related to your brand or product. This is especially true for review-style content or unboxing content.
Paid advertising often allows you to appear at the top of search results too. But once you stop paying for those ads, the flow of traffic goes to zero with no residual benefit.
Influencer marketing partnerships can continue offering a return for months or even years after the paid sponsorship is over. This is due to the content continually appearing in search results.
Ongoing Brand Influencer Partnerships
Influencer marketing also allows brands to engage in ongoing partnerships with influencers within their industry. This relationship helps further build credibility, trust, and awareness for the brand.
With paid ads, there is really no connection between your advertising on the platform and users feeling you support anyone on that platform. For example, if you buy ads on Instagram, no users think you’re helping to support creators.
The ability to forge ongoing advertising partnerships is unique to influencer marketing and allows your brand to show an audience how much you support various creators, industries, or content.
The Benefits Of Paid Ads

We’ve listed a host of benefits that influencer marketing has over paid ads, but that doesn’t mean paid ads are without their own strengths. Paid ads are still a vital part of a digital marketing strategy and we’ll cover those key strengths below.
Easier To Track Results
A key strength of paid ads is the ability to closely track many aspects of the ad campaign directly from the ad platform’s dashboard. Most advertising platforms offer deep analytics that you can use to monitor your results along with other advertisers on the platform.
With influencer marketing, you can still track results, but metrics are sometimes more nebulous compared to the hard data found with paid ads. For example, with most paid ad platforms, you can see how the user found your ad and then continue to track them after they click on your landing page.
That information from your own site can often be integrated with the paid platform via an API or plugin. This allows for deep tracking of customers so you can optimize your funnel and maximize returns.
There are still many ways to track metrics with influencer marketing, but it’s often not as deep as when you run a sophisticated paid advertising campaign that leverages all of the tools available to you.
Instant Results
When it comes to how fast you see results, paid advertising wins hands down. On most advertising platforms, you can have your ads running within a few hours of signing up. Generally, the only delay is the approval process of new ads. Once you’re on the platform and established, you can launch new campaigns whenever you want with zero delays.
Influencer marketing always requires some lead time before it goes live. For a simple campaign, this can be as short as a week or so. But larger campaigns can require a month or more of lead time to deal with the intricacies of setting up the entire influencer marketing campaign.
The speed at which you can launch a paid ad campaign isn’t just about convenience. It has benefits for when you want to quickly launch a sale or promotion based on current events or sudden demand changes.
Adjust Campaigns On The Fly
Paid campaigns allow you to manage them almost in real-time. Most brands who spend heavily on paid ads monitor the analytics daily and make adjustments as necessary to maintain optimization or scale them to boost revenue.
Influencer campaigns are not something you can generally adjust on the fly, at least not without significant costs or disruptions.
Influencer campaigns are something where you spend a good deal of time in the planning stage because once launched, they’re mostly set in stone. If you want to make big changes, you have to start over with a new campaign and new content.
This gives paid ads a slight advantage in that it’s easier to test the waters when searching for new audiences or opportunities. You can put together a small test campaign for relatively little money. Then you just monitor it daily to track the results and see if you can optimize it.
This attribute of paid ads makes them lower risk and also allows you to constantly improve while the campaign is live.
Easier Campaign Creation
Generally speaking, campaign creation is also much easier with paid ads. In many cases, one ad specialist can manage the campaign from start to finish without much interaction with outside team members.
Influencer marketing has more moving parts during the creation process. For example, you have to begin by seeking out the right influencers to partner with.
After that, you have to analyze their audience to confirm they’ll be the right fit and lead to a strong ROI.
Next, you have to reach out to those influencers and negotiate a deal. That involves payment structure, contractual details, and content briefs.
Finally, you have to watch when the content goes live to ensure it all comes together as intended.
That may sound complicated, and in some ways it is, but brands and influencer marketing agencies are doing it every single day with great success. However, it’s definitely a more complicated process and requires more management overhead than most paid ad campaigns.
Scalability
Scalability can be a double-edged sword when it comes to paid ads. You can scale up a paid ad campaign almost instantly. However, there is the risk of a much lower ROI if done improperly.
Even with careful research, scaling a paid ad campaign will negatively impact ROI and will require optimization to limit losses. But the speed and immediacy of being able to scale up quickly does beat out influencer marketing.
However, even though influencer marketing may take longer to scale up as you search for new influencers, the ROI can more easily be maintained. Adding similar influencers with similar audiences will generally impact the metrics less than when adding new keywords or audience types to a paid ad.
In some ways, scalability is a wash between influencer marketing and paid ads, but paid ads are definitely faster to scale when needed.
Which Is Better: Paid Ads Or Influencer Marketing

As you might have already guessed, the answer to this question is going to be dependent on several factors.
We outlined the pros and cons of each marketing method and that’s the starting point for deciding which method is best in each situation.
Below is a simple example that explains how to decide which method is best for a specific situation.
Let’s assume you manage an ecommerce store and are planning a Black Friday sale for the upcoming holiday shopping season. For this type of campaign, you need the following attributes.
- Fast campaign setup
- Ability to change messaging as the campaign progresses toward Black Friday
- Keep close tabs on ad spending to ensure product pricing is still optimal
- No need for the promotion once the event is over
For this type of campaign, we can see that paid ads are the most applicable. All of the strengths of paid ads play into what this example campaign requires, making it the easy choice.
However, that doesn’t mean that influencer marketing wouldn’t work in this case. In fact, they could be used together for a stronger message. But overall, paid ads would be the attractive choice in a scenario like this.
The point of this example is to show that deciding between the two can be relatively easy and it’s just a matter of outlining what attributes your campaign requires and then matching that with the appropriate marketing method.
Which Marketing Method Has The Highest ROI: Influencer Marketing vs Paid Ads
At the end of the day, the point of marketing is to generate increased revenue. Whether it’s instant or further down the road, every brand wants the highest ROI on marketing spending.
ROI can also be difficult to compare because there are so many factors to take into consideration. For example, for one company, a 3:1 ROI may be amazing while another company may find that too low.
There are several factors that can impact how ROI is measured between influencer marketing and paid ads.
Some of these include:
- Industry
- Product type & margins
- Customer lifetime value
- Company lifecycle (is it a new brand or established brand)
- Local, national, or global brand
The average return for paid ads across the platform such as Adwords is between 2:1 and 3:1. That means for every dollar spent, the advertiser receives 2 or 3 dollars in gross revenue. Keep in mind that this is the average and some companies can be as high as 25:1. On the flip side, some companies can run at 0.5:1 if they’re running a brand awareness campaign and are less interested in immediate ROI.
For influencer marketing, the expected average ROI is between 5:1 and 20:1 depending on the campaign goal. So the raw numbers and ROI are about the same. However, influencer marketing has other factors that can add to that overall value.
For example, most paid ad campaigns are only concerned with conversions and that’s where a majority of the ROI comes from. With influencer marketing, you can experience strong residual effects along with engagement and brand awareness.
This needs to be calculated to get the total ROI and this is often referred to as EMV (earned media value).
Those types of calculations can start to become complicated and we have a guide on measuring influencer marketing ROI you can view here.
Ultimately, influencer marketing has a slightly higher average than paid advertising when looking at raw conversion-based ROI. However, when factoring in other variables, influencer marketing tends to have a higher overall lifetime ROI when implemented properly.
This higher ROI is what is fueling much of the growth in influencer marketing and attracting such a growing percentage of ad spending to social media influencers.
Deciding Which Marketing Option Is Right For You
Ultimately, both influencer marketing and paid ads can work for virtually any brand. The decision comes down to matching the strengths of the channel with what your specific marketing goals are.
Using the pros and cons in this article should help you as you decide which attributes your specific campaign requires.
Another option is to work with an agency. There are both paid ad agencies as well as dedicated influencer marketing agencies that can handle many of the details when setting up a new campaign and tracking the results.
However, you still need to be familiar with the pros and cons of each method so you can ensure your chosen agency delivers the results you expect.