2017 is poised to be the year that influencer marketing and social advertising overtake most other forms of advertising in our ever-on world.
Projected to beat out TV ad spend this year, digital-based ad sales will become the top media category and rake in over $202 billion worldwide. Keeping pace with the increasing social ad spend, almost half of companies plan to increase their influencer marketing this year, with billions of dollars in increased revenue.
With both forms of advertising continuing to skyrocket, we’ve seen brands debate how to balance their budgets and earn the best ROIs from both
There’s a number of benefits to overlapping influencers and social advertising, since each can pick up an area that the other may lag behind in.
Here’s a breakdown of the ins and outs of influencer advertising and the ways we’ve seen our clients combine its positive effects with proven social advertising for maximum ROI.
WHAT’S AN INFLUENCER & INFLUENCER MARKETING, ANYWAYS?
An influencer is generally described as someone who’s a leader in a specific niche who can use their devoted following and market directly to these specific potential customers.
There are three main types of influencers.
All three of these types of influencers usually engage in the endorsement version of influencer marketing, which is what you’re likely most familiar with seeing.
Celebrities from Emily Ratajkowski to models such as Bella Hadid and Kendall Jenner are seen as attractive to certain advertisers for their loyal fan bases. Whether they are gifted an item, paid via a contract, or given a one-time stipend, major celebrities, as well as influencers, can use their social media and other platforms to share their preference for that company’s specific product.
Similar to the “Oprah effect” of the 90’s and 2000’s, celebrities and influencers sharing products on their social media accounts can lead to a massive increase in sales or at least generate greater awareness for lesser known brands.
These endorsements can cover platforms from blogging to Instagram posts and can range in payment from free samples to millions of dollars.
THE FTC RULES
It’s worth mentioning that in influencer marketing – as with any form of advertising – the FTC has strict rules and regulations around endorsements. Staying away from running afoul of the FTC is crucial if you’re considering or already running campaigns with influencers.
The line between what counts as an acceptable disclosure and what doesn’t can be thin. Hashtags like “Sp”, “Spon”, “Partnership”, or “Collaboration” won’t meet the standard of disclosure but #Ad or #Sponsored are ok as long as they’re clearly shown. But, if they are included within a bunch of other hashtags or a block of text, they won’t.
In blog posts, there has to be a clear statement that’s distinct from the rest of the text or creative to showcase that the content is an ad or that the blogger was paid in some manner.
THE BENEFITS OF INFLUENCER MARKETING
Reach a Very Targeted Audience
Assuming you work with the right influencer, you can reach an audience primed to purchase what you’re selling.
For example, say that you sell journals and you find an influencer who focuses on stationery and paper goods. By teaming up with that influencer to promote your journal, you are marketing to a group of consumers that presumably share a love of the type of product you’re selling.
While the reach might not be as large as other forms of advertising, the audience is likely to be more open to hearing what you have to offer depending on your product’s relevance.
Most *good* influencers will be selective in choosing which products or services they affiliate themselves with, weeding out those that will not resonate with their audiences or will dilute the brand they’ve built.
Influencers aim to create engaging content that resonates with their audiences. Sometimes, the level of engagement and sharing can spike if it truly strikes a chord. If your paid endorsement catches fire with the right audience, the level of organic buzz that could qualify as going viral will help stretch the value of the dollars you invest in this kind of promotion.
Obviously, not every post will go viral. But authentic feeling influencer posts are more likely to do so than a paid ad, and when they do, the payoff can be significant.
As one company that represents influencers put it, “[a]n influencer’s content lives or dies by how much it’s shared, discussed, and replied to.” With the motivation of seeing their own brand grow, influencers purposely write and create content that is valuable, educational, inspiring, humorous, memorable, engaging, and otherwise shareable.
You can expect a bump in followers and build your email & targeting lists from audiences who may not have otherwise turned to you specifically for their needs.
Influencers usually have a very specific niche from which they speak about with authority. Whether their focus is fitness or fencing, most have an unparalleled understanding of their topic, content, and followers.
Because of this very specific focus, they know how best to position whatever product or service that they are endorsing. With this format, discussions of these products and services comes off more as a conversation or a recommendation than an actual advertisement.
This can make what they’re sharing more palatable to consumers, which leads to…
Probably the biggest benefit in working with influencers is the fact that their audiences generally trust them and find their support of a brand to be authentic, even when it’s a clearly marked piece of sponsored content.
You’ll see greater benefits when influencers are successful at “weaving” their stories with your products or services.
Since a staggering 92% of consumers trust the recommendations of someone they personally know, a blogger can generate that feeling of “knowing” the reader, without actually having met them.
Data even shows that 70% of consumers value the opinions of others online, regardless if they know them. Even better, if your product or brand can seem “cold” or “unfriendly” or even just boring, you can use influencers to humanize your products and services.
What this all boils down to is that when consumers decide they are looking for a product, they want to hear from people they trust on the best product or service to buy. Influencers fill that need.
THE CHALLENGES OF INFLUENCER MARKETING
For Failed Disclosures, FTC Blames Brands, Not Influencers
This is a big con since it can cause you to be hit with legal sanctions and fines.
The FTC will always hold you, the advertiser (and not the influencer) responsible if there is a missing or improper disclosure about the influencer’s affiliation with your company.
It’s imperative that you keep a close eye on your influencers and ensure you follow the Federal Trade Commission guidelines concerning disclosures.
You can monitor the influencer’s content, withhold payment for non-disclosure, and create a number of other stop-gap measures to make sure that influencers make known that their content is being supported by your company.
Perception Versus Reality
How big is the influencer’s reach in actuality? That is a question that has come to plague many brands after their influencer marketing campaigns. Are their followers real? Are they geographically located in areas that you serve or can ship to? Are they engaged with the influencer? How much they do respond/share/comment on the influencer’s posts? How will the influencer activate their audiences to ensure maximum value for you?
While these questions can be answered with some extensive research, it’s a large amount of effort to put in in order to validate an influencers’ clout with their audience.
It’s imperative to conduct proper due diligence to make sure there is value beyond large follower numbers.
Tracking Actual Conversions Is Nearly Impossible
At a recent ecommerce event in LA, a YouTube star was asked how she tracks her KPIs and the potential sales from those endorsements. Even with nearly 2 million followers and hundreds of millions of views per video, she said she doesn’t hold herself accountable for driving sales.
The only thing she is concerned about is the creative side of her video and remaining true to her brand. She stated she lets the brand figure out how to track success instead of the responsibility being on her.
A lack of trackable results isn’t limited to this one YouTuber star. While many articles on influencer marketing cite potential KPIs for tracking your success, none of those KPIs include actual sales and conversions.
You have to have an appetite for some level of ambiguous results for these kinds of campaigns. While shares of Facebook posts or a thumbs up on YouTube videos might increase brand awareness and community engagement, proper expectations have to be set in terms of your visibility into paths to conversion.
Increasing Costs Without Increasing Results
An anonymous social media executive offered commentary in DigiDay’s Confessions column to vent their concerns that they were throwing money at influencers with very little sales to show for it.
“We threw too much money at them and did it too quickly,” the executive said. “[I]n 2014, they were making $500 to show up and take some photos. Then it became $1,500. Now it’s hundreds of thousands of dollars. . . . these [influencers] don’t understand budgets.”
Some influencers have created pricing structures that require specific amounts of money out of the gate vs. tempering your budget over the course of a traditional paid social campaign, for example. This type of format means you’ve spent a large sum of money before you even know what you are actually getting in return.
Unless you’re a P&G or Kraft Foods, you don’t have hundreds of thousands of dollars to pour into an influencer who may or may not provide you with enough increased sales to offset their costs.
Lack of Proven ROI
Perhaps the biggest challenge with influencer marketing is the lack of proven results as a consistently performing acquisition channel.
In the end, you want to know that the money you have spent to engage this influencer to endorse your product is worth it. Knowing whether their showcase of your product leads to greater sales is crucial to determining whether or not to continue using this form of advertising.
Unfortunately, tracking whether your spending on an influencer campaign is yielding strong enough numbers to continue can prove difficult, if not impossible.
WHAT PAID SOCIAL ADVERTISING HAS TO DO WITH ANYTHING
You’re likely wondering what exactly we’re doing with our discussion of the good and bad with influencer marketing. We wanted to showcase the way that paid social advertising and influencer marketing can intertwine to provide you with the most bang for your buck when they work together.
There are a few ways paid social & search can fill the gaps of influencer marketing:
Different Formats, Different Results
Much of the success of Influencer marketing comes from the blogosphere where these niche leaders share their stories and Instagram where they share their images, but Facebook and Google rank at the top for driving strong results.
Almost all successful campaigns for brands yield their best results through one (or both) of these formats.
Facebook and Google offer the ability to produce results that are often nascent or non-existent with influencer marketing.
From the moment a potential consumer clicks on your ad, you can follow them through the funnel to the eventual conversion. Even if some don’t convert, you can utilize the knowledge gained through these trackable results to ensure even better outcomes with the next campaign.
Another advantage that social advertising has over influencers is the proven ROI. Paid advertising on search and social can show you exactly what works, what doesn’t, and you can continue to refine this knowledge to ensure powerful results incrementally, vs. adjusting only after you’ve invested a big chunk of money.
Influencers can be a gamble, particularly if you don’t do your due diligence or you go it alone vs. working with an influencer agency or established network.
With social advertising campaigns utilizing paid search and social ads, you can know when and how your campaign will perform as it’s occurring.
No Threat of Legal Trouble with FTC
Finally, the legal burden is much less when you invest in paid search and social advertising.
The nature of Google, Facebook and related channels is to provide advertisers with FTC-approved ad types and placements; you simply have to play by the rules of those channels on the type of content or offers you can and cannot promote.
Short of advertising illegal drugs or products along those lines, it’s fairly easy to comply.
And since Facebook and Google’s native advertising ad types are “clear and unambiguous” as required by the FTC, unless you decide to flat out lie or are intentionally deceptive in your advertisement, you’ll likely keep away from any issues there as well.
INVEST IN SOCIAL ADVERTISING AND INFLUENCERS TOGETHER
We’re not here to argue that social advertising is superior to influencer marketing. We believe that the best method for you to get the biggest bang for your buck is to overlap the benefits of both.
A Rising Tide Lifts All Ships
Like social advertising, “[i]nfluencers can be segmented by demographic (i.e. millennials, baby boomers), by vertical (fitness, fashion, entertainment), platform (YouTube, Instagram, blogs), geography, or a powerful combination of all four.”
Using these segments to your advantage and basing your spend on them can lead to success.
Say you have a product that appeals to a variety of generations – Generation Z, Millennials, and Gen X. If you know that Generation Z is on Snapchat and Youtube, you can use an influencer campaign to promote your message through both of those mediums. You can then craft campaigns for Youtube, Search, and Facebook, where you often be discovered by more Gen X and Millennials.
If that Gen Z’er sees the influencer talking about your product, they may go to search to find out more, which will lead them to your paid search ad. Or perhaps a Millennial sees a Facebook ad for your product, then goes to Youtube to see if there are any videos that showcase how your product works. The influencer’s video can then come in handy to lead them farther down the path to conversion.
You’ll gain more mileage and cover more ground when you use both together to fuel discovery and conversion.
Different Areas of Impact
What Influencers Can Measure
As showcased by the chart, influencers have some measurement ability when it comes to seeing the reach of their message.
For example, the number of blog comments or the shares of their Youtube video can offer an idea of how far their message has reached, but not necessarily the impact the message has made.
What Social Advertisers Can Measure
Social ads can get even more granular in terms of measuring impact by outlining for you the click through rate, the conversion rate, the cost per customer for acquiring them, and the overall return on your ad spend.
The performance of paid advertising and influencers working together can provide you with information on your customers, their wants and needs, and allow you to create stronger future campaigns as a result.
Understanding What You’re Getting For Your Money
The best way to get quantifiable ROI is to use direct response social advertising campaigns via search and social. You can find and understand accurately where and how exactly your money is being spent, in addition to what is working, so you can do more of that, and what isn’t.
While influencer marketing often can’t give you the same granular conversion numbers, you can increase your ability to track the influence of their endorsements through custom URLs or unique discount/access codes specific to the campaign. This will help you to see whether their followers are responsible for an increased rate of traffic on your website leading to conversions.
And since we believe in lessons more than failures, it may be that you discover influencers to be more of a top-of-the-funnel discovery and branding play that fuels searches and provides rich retargeting pools for you to pursue in other areas of your social advertising.
The advertising world is growing and changing at lightening speed and 2017 will be no different.
Since influencer marketing and social advertising are only increasing their market share, it’s a smart company who begins incorporating them into their advertising strategy.
While each possess individual strengths, it’s only when you take influencer marketing and combine its positive effects with proven social advertising that you’ll succeed in seeing your maximum ROI.