I have a new theory — call it a prediction — about the future of influencer marketing.

Recently, Instagram has been meeting with some of its latest advertisers and media partners to council them on the social platform’s latest algorithm update — a transition that will rank newsfeed content by relevance, rather than chronology, similar to its parent Facebook’s own newsfeed algorithm. Instagram’s advice to marketers, succinctly summarized, boils down to this: “Make better content to keep up with the aesthetic expectations of users, and get ready to advertise [even more] to distribute it, because Instagram organic reach will ultimately follow the downward trend as Facebook’s.”

While any marketer caught off guard by this shift couldn’t have been paying attention to the last few years of social media history, what’s interesting to me is how the organic reach race-to-the-bottom keeps reaffirming the same, cyclical social advertising sequence:

1. A social ecosystem (i.e., Facebook, Pinterest) emerges and attracts users.

2. The existence of these users attracts marketers looking to build community and communicate to this audience.

3. Marketers create brand profiles (the earliest example was a Facebook page), and start publishing content.

4. The influx of marketing content degrades the ecosystem’s user experience, so the social platform limits the organic reach of brand content (algorithmically).

5. But, because virtually every content feed in human history (i.e., newspaper, TV, social media) generates revenue from (a) advertising and/or (b) subscriptions, paid reach becomes the de facto way for marketers to distribute content, pushing out advertisers who can’t afford the platform’s pay-to-play model.

And then a new ecosystem (like Snapchat) emerges, and the cycle begins all over again.

So what does this mean for influencer marketing?

For any given social platform, influencers — the celebrities, athletes, artists, and other early adopters who successfully attract a large, engaged following — often serve as “distribution bridges” for brands as the social community transitions from open publishing to pay-to-promote. As organic reach declines, marketers often supplement their own reach via macro and micro-influencer partnerships, whose more algorithm-friendly social proof plays well to voluntary viewership.

And brands are rushing to embrace this strategy, leading to interesting recent allegiances between Amazon and Alec Baldwin, Adidas and Selena Gomez, and Squarespace and comedians Key and Peele. Other brands, like Kenneth Cole, have relied on less mainstream influencers for their “Courageous Class” campaign, challenging traditional influencer endorsements by asserting “the real models are the role models.”

Best 2016 Influencer Marketing Campaigns

So brands grow their traffic numbers by smartly distributing content through influencers, and [most] influencers are happy to collect large sums in exchange for access to their audience. Seems like both parties are getting what they want. The only problem is this value exchange is happening on social platforms — and the social platform — whose revenue model is underpinned by paid content — is missing out on the value capture. Yes, granted, influencer activity on any given platform likely attracts broader user activity, thereby creating in-app time where ads can be served, but if Coca-Cola is paying Taylor Swift millions of dollars to publish a #sponsoredpost, those are millions being diverted from advertising income an Instagram or Snapchat might otherwise collect. Facebook seems to realize this most acutely, and sees organic reach reduction on Instagram as the next logical step in pulling more brand activity away from influencers and into its ads UI. After all, influencers have organic reach advantages over most brands, but as organic reach approaches zero it also slices into their ability to engage their fans as well. Snapchat, I suspect, isn’t far behind.

The endgame, if you play this out, is that as the major Western social networks — Facebook, Instagram, Snapchat — mature in terms of monetization (and in some ways move more in the direction of WeChat), brands will take the initial, bigger hit, but most will continue to pay to play. By comparison, all but the top tier of digital influencers may see their revenue pool shrink as more and more is reclaimed by the platform itself. Not only that, but social is increasingly converging with mobile chat, where person-to-person (P2P) conversation renders centrally published content reach largely irrelevant. Beyonce or Justin Bieber can connect with a huge audience on Instagram or YouTube, but not as linearly on WhatsApp or Facebook Messenger. As a result, my prediction is the pendulum will shift back toward celebrity sponsorships, and away from native content distribution through influencers. Brands will continue to rely on influencers for social proof and the creative spark they can provide, but marketers will have to pivot back to owning the last mile of getting their message in front of customers.

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