Opinion

The Rise and Fall of Influencer Marketing

Celebrity endorsement is falling out of favour with marketers for three reasons: celebrities command large sums of money to endorse products; consumers are increasingly turning to friends and colleagues when looking to buy something new; and despite large followings, celebrities are often out of touch with the average consumer. To fill the gap left by celebrity endorsements and to make the most of the social media opportunity, marketers are increasingly turning to influencer marketing.

Television has long been used as an influencer channel, often combined with celebrity endorsement in the form of commercials. The problem with TV, including programmatic TV, is that brands are still reaching a broad spectrum of consumers rather than niche segments.

In contrast, with influencer marketing, brands can reach a niche audience through a channel consumers want to engage with and trust at a fraction of the cost of TV and celebrity endorsement.

Today, 98% of marketers say they see value in incorporating influencers into their marketing strategy, according to the findings in a recent report carried out by Forrester. Influencer marketing is not an entirely new concept – for years brands have used celebrity endorsement as a way to increase brand awareness and drive sales.

Retaining trust

A recent study by Rakuten Marketing found that marketers would pay up to £75,000 for a single post mentioning their brand by someone with over one million followers. Furthermore, micro-influencers – those with under 10,000 followers – can command, on average, £1,500 for a single post.

Over the past year, marketers have started to question the validity of influencer marketing and this month Keith Weed, Unilever’s CMCO, said that bad practice in the influencer marketing space, such as fake followers, bots, fraud and dishonest business models is eroding trust. He called on the ad industry and platforms like Instagram to take urgent action now to rebuild trust before it’s gone forever”.

What goes wrong?

The two biggest problems brands face are misleading engagement, and a lack of transparency from influencer marketing platforms. Misleading engagement boils down to influencers who do not declare that they buy followers and the rise of bot accounts on social media platforms. It has recently emerged that as many as 15% of Twitters ‘users’ may be fake, while up to 60 million Facebook accounts could also be automated or bot accounts.

Influencer marketing platforms have been found to inaccurately report engagement and actions, in turn distorting the reality of campaign performance.

How to avoid pitfalls

There are several things brands can do to ensure their influencer marketing activities are genuinely delivering value.

Brands should take ownership of the influencer discovery phase rather than relying on data from influencer marketing platforms. To do this you need to have a deep understanding of your target audience: who are they, what are their interests outside of your products or services, which media channels do they use, and how often?

This involves working closely with your audience to build relationships and develop trust. Beyond this, you should look at your wider marketing efforts to see where you can draw insights. For example, using audience insights from programmatic data helps identify everyday influencers with similar likes and interests to your current customers. In turn, this will help to ensure that your influencer campaign will hit consumers that have a genuine interest in your product or services.

Next comes the influencer research phase – who are the influencers that your target audience engages with that share common brand values? Other checkpoints include the originality of their content, how regularly they post, and how they secure followers.

Once you have identified a set of influencers to target, it’s vital that the brand and the influencer work together to create content that is truly unique, relevant to the brand’s target audience, and relevant to the influencers’ followers. This needs to be authentic and reflect the language and tone of the community you’re trying to attract.

Many brands combine their influencer marketing with their social media marketing to maximize effectiveness and ROI.

Moving forward

A crossroads has been reached and it’s make or break time for influencer marketing – much the same as it was for programmatic advertising a few years ago when levels of viewability and fraud were exposed.

If the online ad industry can solve these problems then the influencer market – estimated to be worth $2 billion in 2017 and set to reach $10 billion by 2020 – will continue to see more growth in the industry and become an efficient marketplace.

Brands that get influencer marketing right will realise long-term benefits through association with influencers that will bolster the brand’s credibility and reputation, as well as drive sales.

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