Being able to determine ROI from an influencer campaign still remains the top concern among ... [+]
There is no denying that social media influencers can make a good living promoting brands, but the other half of the equation is whether this is actually a good investment for those brands. As has noted, there is always the chance that an influencer can become bigger than the brands he/she is promoting, but even if the brand remains the bigger player there is then the issue of whether the return on investment (ROI) is meaningful enough for most companies.
Linqia has released its fourth annual State of Influencer Marketing Report, and it found that influencer marketing is continuing to grown. Some 40% of marketers are now running six or more campaigns, while 57% of marketers have plans to increase influencer budgets.
"While the mediums and platforms of influencers are changing, we can expect this form of advertising to remain in the marketing mix," said Elizabeth Scherle, co-founder of Influenster. "Influencer spending among brands hit record highs last fiscal year and is projected to reach $10 billion in global spending within the next two years."
However, being able to determine ROI from an influencer campaign still remains the top concern among marketers. In other words it isn't enough just to be popular on social media if it doesn't result in sales.
"Influencers are definitely not going anywhere, but they are now facing growing expectations from consumers, and consequently brands, which are beginning to encourage authentic product recommendations versus just sponsored content," added Scherle.
"If you are using influencers the right way, there will always be ROI from influencers," said Daniel Schotland, COO of Linqia.
"Marketers should always start with the end in mind and think about the goal of the overall campaign," he added. "Brand awareness, increasing purchase intent, getting consumers to visit your store or driving actual sales are very different initiatives when it comes to influencer marketing."
As important is determining the type of influencer and the correct channels to activate for a specific campaign.
"For example, if you're looking to drive brand awareness, larger influencers such as mega – influencers with half a million to millions of followers – or macro – influencers with hundreds of thousands of followers – on channels like Instagram can be extremely successful," explained Schotland. "If you're working with the correct strategic influencer marketing partner, you can design the influencer strategy that will always deliver on your goals."
One Size Doesn't Fit All
One mistake marketing teams can make is assuming that all campaigns should be equal in size and scope. While mega influencers can reach the masses this isn't always the best approach to reach a niche audience.
"Influencers with a high follower count are a proven way to generate buzz, awareness, and inspiration on behalf of brands," said Scherle. "However, consumers are demanding more authenticity and credibility from this type of marketing."
Influencers' follower counts should no longer be seen as the most important key performance indicator.
"This is why brands are now utilizing a mix of high-tier influencers, who have a larger reach, with a group of real people advocates to ensure that they're getting their brand in front of as many consumers as possible, while also generating high engagement rates and conversion," added Scherle.
Instead, she said that just as important for an influencers ability to be real, relatable, and resonate with niche audiences who build a consumer's trust and sell product prove their value. "These 'micro-influencers' and 'everyday consumers' are being tapped as brand advocates to provide more genuine recommendations."
According to Linqia's findings, micro-influencers – those with 5,000 to 100,000 followers – continue to grow in popularity with 78% of marketers saying they want to work with micro-influencers in 2020. This was the most selected influencer type, and the use of celebrity influencers is in decline.
At The Micro Level
The Linqia study found that micro-influencers have continued to grow in popularity with marketers, and 75% of marketers suggesting that they'd want to work with this level of influencer in 2020. In fact, this was the most selected influencer type, while celebrity influencers were on the decline.
This could mean that becoming a micro-influencer could even become a valid career this year.
"Many micro-influencers create sponsored content as a supplemental income and not a full-time profession when they are first starting out," said Schotland. "These micro-influencers work full-time jobs, while running their own digital accounts and producing sponsored content on the side. Striving to become a macro influencer – more than 100,000 followers – allows an influencer to earn enough money to make content creation their full-time career."
However, to reach that level and grow their following, influencers will need to really listen to their audience and look at their own data while exploring the latest trends to create consistent content that will resonate with said audience.
"Influencers can also keep the momentum going by having conversations on their own posts, as well as keeping a dialogue open on others' posts," suggested Schotland.
Decline Of the Celebrity Influencer
As noted, celebrity influencers are on the decline, but that doesn't mean they're likely to go away in 2020.
"Celebrity influencers were the original influencers," added Schotland. "As Instagram was just starting to explode, consumers loved the opportunity to follow their favorite celebrities and to communicate directly with them. Brands saw that large audience celebrities were able to amass and wanted in on the action, so they worked directly with celebrities to post about their products."
For this reason celebrity influencers are still used today, but much more sparingly.
"As we saw in the State of Influencer Marketing 2020 report, only 22% of marketers plan to use celebrity in 2020, while 77% plan to use micro-influencers," said Schotland. "Micro-influencers are more versatile, as they can drive real engagement and the desired outcome from the consumer."
So no matter how you slice up the audience, the influence from influencers will remain high in 2020.
"Influencers are definitely not going anywhere," said Scherle. "But they are now facing growing expectations from consumers, and consequently brands, which are beginning to encourage authentic product recommendations versus just sponsored content."
