Marketers are spending billions on influencer strategies. In fact, experts predict a $1.7 billion spend on influencer campaigns on Instagram 2018. But how effective is influencer marketing? And is it the right strategy for your brand?
This post will give you a deeper understanding of influencer marketing trends, issues, and how to choose the right strategy for your business.
Why Is Influencer Marketing So Popular?
The draw of influencer marketing is its’ value for money, in comparison to alternatives, e.g. advertising.
According to a poll by influencer marketplace Tomoson, influencer marketing generates $6.50 in revenue for each $1 spent. This is primarily due to the fact that consumers trust influencer content, more than ads or branded content.
In fact, 92% of consumers trust recommendations from others, (even people they don’t know) over branded content (AdWeek, 2015). These attributes are what makes influencer marketing such a powerful strategy.
The best influencers are seen as experts in their fields, by their followers. Their expert status makes their word-of-mouth recommendations very valuable. They have the power to influence purchase decisions among large and relevant audiences. YouTube content is particularly valuable because video is a highly engaging form of content.
To illustrate the impact of influencer content, check out this compilation of videos from both high and low-level YouTube beauty vloggers. They’re demonstrating and reviewing Rihanna’s new Fenty Beauty products. This style of user-generated content is much more authentic than branded content or ads.
The video has garnered over 28 million views and 230,000 shares on Facebook.
Rihanna’s FentyBeauty is changing the game for foundation—and YouTubers are L O V I N G the 40 foundation shades for every skin tone: http://bit.ly/2fijHBA
Many successful influencers have built close relationships with their followers, creating engaged communities. These bonds strengthen influencers’ abilities to influence their followers’ decisions and perceptions.
3 Important Elements To Consider For Your Influencer Strategy
Before you invest in any influencer strategies, you should consider the following three elements of influencer marketing:
These core elements are pivotal to the performance of influencer marketing strategies. Ignoring these elements could result in damage to your brand image, losses, and regulatory penalties.
Many markets (Europe, Australia, and The United States) have introduced strict rules around disclosure. Governing bodies are now treating influencer posts like product placements. Meaning influencers must disclose when they are being compensated by a brand, in exchange for talking about their products.
As a result of these new rules on disclosure – everyday consumers are becoming more aware of the prevalence of influencer marketing. Cautious consumers are now questioning the authenticity of these posts, and the integrity of the people behind them.
In addition to these rules, viral stories of inauthentic influencer campaigns have given the strategy, somewhat of a bad name. For example, let’s look back at the Fyre Festival chaos that happened in April 2017. It’s rumored that the festival organizers paid influencers like Kendall Jenner and Bella Hadid up to $250,000 to promote the event. Tickets to this ultra-chic “Coachella in the Caribbean” event cost $12,000 each – promising rock bands, private villas, and celebrity chefs.
The event was a disaster, with people comparing it to The Hunger Games. People were stranded on a remote island with little food or water, no performances, and had to sleep in emergency tents with damp carpets.
The event organizers and influencers involved have received a lawsuit in excess of $100 million for fraud, negligent misrepresentation, and unfair trade practices.
The news was widespread and trended for days. Unfortunately, instances like this have had a negative effect on influencer marketing as a whole. More consumers are now suspicious of deceptive and inauthentic posts from influencers.
These issues around authenticity have also had a detrimental effect on trust in influencer marketing. Trust in influencers is dropping, as consumers’ perceptions of influencer marketing verges on the side of advertising.
According to Edelman’s 2016 Trust Barometer research – only 42% of consumers said they trust content by well-known online personalities. Whereas, almost double that (78%) said they trust content from their friends and family – making friends and family the most trusted source of content online.
This trend has continued into 2017 – people now consider ‘a person like yourself,’ as credible as academic and technical experts (Edelman’s 2017 Trust Barometer, Slide 36).
Marketers are recognizing these drops in trust, which has led to the latest trend in influencer marketing – micro influencer marketing. We will discuss micro and peer influencers in more detail in the Popdeem Influencer Pyramid section.
To clarify, we’re not saying that no one trusts influencers. There are influencers that have dedicated a lot of time and work to establish trust and credibility. Our advice is to be careful when selecting influencers to work with. To achieve the best results possible, there needs to be an obvious fit between your brand and the influencer. And they should have close and trusting relationships with their followers.
Now that you’re aware of the importance of these three elements of influencer marketing, let’s dive into how to choose the best influencer strategy for your business.
With The Right Influencer Strategy – Magic Can Still Happen
The best influencers are known for only endorsing messages they truly believe in, sharing valuable information, and expert opinions. Remember the point about experts in the previous section? If a consumer considers an influencer to be an expert in their area, then they trust them as much as they trust a person like themselves. (2017, Edelman)
The more trustworthy an influencer is, the greater power they have to influence purchase decisions and mold brand perceptions. This makes trust a key determining factor in influencer strategy performance.
How To Craft A Strong Influencer Strategy
The strength of an influencer strategy is determined by the results you achieve, versus your objectives. Your objectives may be to:
- Raise awareness of a new store opening
- Promote a product launch
- Increase footfall
- Drive users to your website/app
- Improve brand perception
But for many, the ultimate goal is strong ROI – i.e. the sales/profit made as a result of investing in an influencer marketing strategy.
The Popdeem Influencer Pyramid
If you search ‘Influencer Pyramid,’ you’ll find all sorts of different frameworks. Some will include journalists, some will include customers. You’ll also find that there’s no industry standard of how many followers makes someone an influencer, or even a micro influencer.
We’ve carefully crafted The Popdeem Influencer Pyramid, which is based on current trends and research, as well as our own experience with our clients. Check out the pros and cons of each group segment of the Popdeem Influencer Pyramid in the video below.
The Hunt For Authentic Influencers Should Start With Your Customers
Why Micro & Peer Influencers Are Such Strong Advocates For Your Brand
As you can see from the research referenced in this article and the video above – micro and peer influencers generate the highest ROI. These are people with a modest following, but their content and recommendations are highly trusted. So when choosing your influencer strategy, you should consider starting with your customers first.
You have a pool of untapped potential in your customer base. They’re ready and waiting to talk about your brand – if you give them the right incentive.
At Popdeem, we’ve found that customers can be the most effective influencers for your brand. This is because they are real customers, which means their posts are authentic and trustworthy – not forced. It’s powerful word-of-mouth marketing at scale.
The most attractive feature of this micro and peer influencer strategy is that it’s cost-effective and generates high ROI. The cost of giving back to customers for their word of mouth promotion is much lower than sponsoring professional influencers.
Not only does it encourage customers to create a social media buzz about your brand, it also fosters customer loyalty and retention. For instance, offering rewards like 50% off your next order, in exchange for a social post, encourages repeat visits and purchases, while also benefiting your brand online.
If you’re considering delving into the world of influencer marketing, or if you’d like to optimize your current marketing strategies, feel free to message us at firstname.lastname@example.org.
Or if you’re in the market for a social engagement tool that makes it easy for you to reward your customers for sharing their experiences on social media – please visit https://popdeem.com/.
With Popdeem, you can reward customers with coupons, loyalty points, prizes, or charity donations, when they share photos on Instagram, check-in on Facebook, or use a branded hashtag. For more information on how Popdeem works, check out this article, Heine Brothers’ Coffee Unveils Social Rewards Program on QSRMagazine.com.