How The Value of Influencer Marketing Has Shifted

Since the initial introduction of the Influencer to the world of marketing, it has been viewed as one of the most efficient and inexpensive ways for brands to drive awareness and expand their audience. The concept of using trusted personas to sell to consumers who already have some level of affinity for those who are selling to them, made perfect sense and seemed to be an almost fool-proof strategy to gain brand awareness. But as Influencer Marketing has evolved, it has become more complex and more expensive. 

Below, you’ll find what you need to know about the current state of Influencer Marketing, as well as the best ways to get the most out of Influencer Marketing in 2020 and beyond

Oversaturation

One of the most prominent issues within Influencer Marketing is oversaturation. Being paid to post to social media has become the new “American dream”, so as the trend has emerged, everyone with an Instagram account has attempted to capitalize on it. 

There are far too many accounts attempting to gain influencer status. Many of these aspiring influencers may have the follower count to support their status, but lack the key trait that is essential to securing returns on investment — actual influence. The value of influencer marketing relies on the credibility and relationship that an influencer has with their audience. This has caused brands to shift their focus to micro and nano influencers, because consumers trust opinions and recommendations from sources they deem personal and authentic — real people

Effectiveness 

High follower count isn’t always congruent with high engagement. Far too many Instagram accounts have inflated follower numbers when compared to the actual reach they offer. These inflated follower counts could be considered “empty calories” with high percentages of the follower accounts being inactive, un-engaged, or simply being paid-for-bots. All of which are worthless to a brand that is trying to generate a thriving and authentic online community. 

Cybersecurity firm Cheq estimates that businesses lost 1.3 billion dollars to Influencer Fraud in 2019, so it’s imperative that when laying out your Influencer Marketing strategy, you’re able to identify the right influencers to get significant value out of your investment. Luckily, the industry is now recognizing the most efficient and cost-effective path forward, which is building more authentic online brand communities.

The Best Way To Work With Influencers

In the past there’s been no true industry standard for how much influencers get paid per post. Traditionally, companies have roughly estimated the value of an influencers reach based off of their follower count, which we now know can’t quite be trusted. 

While companies used to develop relationships directly with their individual influencers, the landscape of Influencer marketing has shifted to a more reliable model, where influencers are working with agencies to find the right brands for them, and vice versa. This new system is much more efficient and reliable for companies and brands as they’re making more manageable payouts to the influencers with a more certain guarantee of the reach and engagement they’ll be receiving in return. In turn, this has developed a new industry standard for how this form of advertisement should be conducted.

What will Influencer Marketing look like beyond 2020?

Despite the recent discoveries of a few glaring flaws, there is still value in to be found in Influencer Marketing. However, like all forms of advertisement, it should be conducted with focus, strategy, and efficiency. As consumers trust traditional advertising less and less, it’s important to look at how to solve the issues within influencer marketing, like effectiveness and fraud. The most authentic way to get people to talk about your brand is to invest in real people. 

Brands should look to build a community of real people who are authentic brand fans. By focusing less on follower count and more on the relationship they have with their community,  the increased ROI will follow naturally. 

A Deeper Connection Between Consumers and Brands: Why User Generated Content Should Be Part of Your Social Strategy

Trust has a significant and direct effect on consumers’ intention to buy. Social media, specifically Instagram, is becoming an increasingly strong Direct To Consumer (DTC) sales channel. With more consumers using social media than ever — 3.5 billion to be exact — it’s important to mobilize the marketing power it provides. 

Beyond the experience a consumer may encounter with a brand through different marketing touch points, social media is a powerful tool because it provides a voice that consumers deem more reputable and trustworthy than a banner ad or billboard. People follow their friends, family, and public figures like celebrities and influencers that all have an influence on what and why they buy. 

As consumers browse social media, the content created by people they follow, begins to inform their opinion and ultimately drives their decision to purchase. Ultimately, for consumers, it creates the sense that they have more control over their own purchasing journey because it feels relatable and personalized. 

Given this, brands have two options. They can choose to place paid-ads in their consumers’ newsfeeds, or they can enlist their brand fans to create content that reflects a positive consumer opinion of the brand or product. The choice is clear, given that user generated content (UGC) affects 90% of shoppers’ purchasing decisions. This type of content also tends to be the most engaging, compared to paid-ads. 

This is why brands are relying on UGC to support their word of mouth marketing strategies. People trust real people and real opinions. Especially given the rise of the Influencer (and with it Influencer fraud) over the past several years, social media has provided a platform for brands to heavily influence buying decisions using UGC.

With social media quickly becoming a strong DTC sales channel, more brands are deciding to  invest in UGC. As more content is created and engaged with, the brands gain more earned media — ultimately the most credible form of content for the brand because it is being created by highly satisfied customers. This content, when given increased distribution via social media, will drive higher conversions than any other paid channel. 

According to a study in AdAge, brands that replace their traditional paid media with earned media see their conversion jump from 1% to 5% or higher. Still, many brands are still paying rent to Facebook and Google to drive clicks when they should be focusing on content strategy. Consumer opinion can’t be bought — brands should be investing more in relationships with their brand advocates, as it is ultimately what drives earned media and in turn, deeper connections with the brand and lasting ROI.

UGC is valuable because it broadens the reach of a brand in the most organic way. Consumers want to hear from people with authentic perspectives, who have already experienced a product. 83% of people trust recommendations from someone they know. When a majority of consumers live on social media, it makes sense to engage active users of your product to create and share content about their experience with it — particularly when more than half of these posts are based on a positive experience with a brand or product. UGC humanizes a brand and allows them to create deeper, more emotional connections with consumers and should be used as a way to maintain human touch between brand and consumer. 

Ultimately, UGC humanizes a brand and allows them to forge stronger connections with consumers, and word of mouth plays an integral role in introducing those connections. Having a broad reach with multiple voices advocating for a brand allows them to cultivate stronger relationships with their customers. In an age where social media encourages and fosters consumer trust, it’s important for brands to activate word of mouth through their social media channels in a way that resonates more deeply with consumers. 

Are You a Victim of Influencer Fraud?

$1.3 billion. That’s how much influencer marketing fraud will cost brands in 2019. Influencer fraud can do more than just financial damage to your brand. It can also weaken your brand’s reputation and affect its credibility. Fake influencers seem to be legit at first glance, but their biggest identifier is that their followers are almost entirely fake accounts or bots. It’s important to identify some of the key warning signs that you might be experiencing fraud. 

Some warning signs of fraudulent activity are: 

  • Recently created accounts with tons of followers, but very little engagement
  • Unusual spikes in followers or engagement soon after a post 
  • Generic comments that have nothing to do with the post 

This is why more and more brands are shifting their focus away from influencers to ambassadors, who typically don’t have the same high follower count, but instead have a much more engaged audience. Brand ambassadors are real people who already love your brand and want to spread the word about your products or services to whoever will listen to them. 

Ambassadors are experts on your brand, and rather than searching for them through databases or hiring agencies to find them for you, they’re often living right in your backyard. Your employees, interns, partners, and existing customers are already engaging with your brand on a daily basis and they make great ambassadors. And you already know they are credible people who post authentic content about your brand. 

The numbers don’t lie — it’s time to make the shift away from focusing on follower count, and more on the things that actually drive results: organic content creation coming from real people your audience trusts.

Micro-influencers: the New Celebrity Endorsements?

Influencer marketing operates by incentivizing key individuals to promote a product. These individuals are usually famous celebrities who are being compensated generously for posting on Instagram or Twitter.  Because of this, consumers often filter out and ignore what they perceive as disingenuous endorsements blasted to millions of followers. Micro-influencers can break this negative trend by generating engaging, honest recommendations and advertisements to a specific group of loyal followers.

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How Disco Donnie Presents Generated Millions in Value via Word of Mouth Marketing

Have you ever done something, whether it was listening to a new artist on Spotify or buying some cool kicks, because a friend recommended it?

You’re not alone.

Nowadays, millennials place a greater emphasis on the opinions of others who share similar views and experiences as themselves. According to a study by Nielsen, over 92% of all consumers trust their peers for recommendation above all other forms of advertisement.

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For this reason, brands have begun integrating strategies that focus more on the impact of influencer (peer-to-peer) marketing via social media and in-person interactions rather than traditional television ads. This marketing strategy, commonly referred to as ‘peer-to-peer marketing,’ has become integral to the success of many brands. While traditional ads are still prevalent, their purpose only encompasses bringing awareness to new products and services. Traditional advertisements don’t drive as much revenue for a brand as they used to because consumers prefer to trust recommendations from friends.

The authenticity and approachability in their communication with peers allows micro-influencers—an influencer with a smaller but more loyal following—to create a ‘people like me’ factor, making them more relatable to a brand’s audience. As they become the new faces of digital marketing, micro-influencers are able to reach a wider audience in ways other forms of advertising such as banner ads simply can’t.

When we see our friends, family members, and even co-workers talking about how great the new features are on the iPhone 7, we are inclined to purchase it ourselves as a way of retaining that sense of connectedness with those around us. SocialLadder, for example, uses this peer marketing technique in its challenges by having micro-influencers share things such as posts, videos or even their favorite memory of an event on Instagram, Facebook, and Twitter with friends. With this, they are able to bring more attention to an upcoming event and, by extension, the brand promoting the event, leading to more ticket sales.

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Disco Donnie Presents, one of the leading electronic dance music promotion companies that worked closely with SocialLadder on promotion efforts for Sunset, Sun City and Something Wicked this past year, was able to successfully incorporate peer-to-peermarketing strategies to increase its revenue and presence in the social sphere.

Fans of the company signed up to become ambassadors and helped generate over 28.5 million impressions and sell over 8,900 tickets without offering any discounts. On Instagram alone, ambassadors generated more than 2,000 unique pieces of content that reached 8.25 million people. By having individuals complete challenges—over 18,500 social posts generated by ambassadors on Facebook, Twitter and Instagram—Disco Donnie Presents was able to generate millions of additional value in just a few short weeks.

As you can see, micro-influencers are rapidly driving up revenue for brands by acting as their ambassadors and promoting products or services to their friends, family members, and co-workers. Successful brands have thus looked to social media to better connect with their consumer base and drive up overall gross revenue. If a brand hopes to continue its success or drive up its more revenue, it will have to take the necessary steps to ensure it incorporates some level of peer-to-peer marketing in its campaign.

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Mirayda Martínez is an intern at SocialLadder. She is currently pursuing a Bachelor’s Degree in Economics and Computer Science at Swarthmore College, as part of the class of 2020, and is a member of the the Swarthmore Track & Field team. She loves going to parks and petting any and all kinds of dogs, as well as rock climbing.

Turn Your Facebook “Likes” Into Sales

For the past decade, there has been an upward trend when it comes to using social media to advertise. Big brands have inundated their databases with users, aiming to assemble the largest cache of data–aka “likes”–, in an attempt to reach a broader audience. According to Forbes, the flaw with this practice is that “brands are too caught up in collecting social media fans, and they are forgetting to actually connect with them.” (Whitler)

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