Influence Pays off: How Social Media Influencer Investment Drives ROI through Brand Awareness

Abstract

Social media influencers have become increasingly potent in the rapidly changing field of digital marketing intermediaries between brands and consumers. This study examines whether investment in social media influencers (ISMI) leads to a financially beneficial return on investment (FROI), with brand awareness (BA) as a potential mediator. Using a sample of 400 respondents, a mediation analysis was carried out to evaluate the direct and indirect effects of ISMI on FROI. Results confirm that businesses investing in influencer marketing experience measurable financial gains. Additionally, the findings reveal that brand awareness partially mediates this relationship, indicating that some of the financial benefits of ISMI are achieved through increased brand visibility and consumer engagement. The study highlights the practical and theoretical implications of influencer marketing; emphasizing that strategic investment in social media influencers enhances brand awareness, ultimately translating into higher financial returns. However, given that ISMI explains only 17.65% of the variance in FROI, future research should explore additional influencing factors, industry-specific differences, and long-term financial impacts. For marketers, brands, and companies looking to maximize their digital marketing tactics for long-term financial success, these findings provide insightful information.