We are well and truly in the middle of the digital revolution, including the marketing and advertising world. Long gone are the days of traditional TV advertising. It has been completely revolutionised thanks to new technologies and social media platforms. It is a term we often hear, but what exactly is influencer marketing, why it has become popular and what are the risks.
How Does Influencer Marketing Work?
The idea of using a well-known or celebrity figure to promote a product or service is not new, and some of the most famous and successful campaigns have been Michael Jordan for Nike and Britney Spears for Pepsi. Today, most well-known brands still work with celebrities and influencers to promote their products. The difference is that an influencer can be pretty much anyone these days.
Influencer marketing takes this old-school idea of using a celebrity or other public figure and transforms it to fit our digital era. However, the distinction is that influencer marketing takes advantage of a very modern concept, the influencer, often getting their start on Instagram or TikTok. There are numerous types of influencers, including beauty, fashion, food, lifestyle and travel. Some of the most well-known influencers in the United States are Addison Rae and James Charles.
On average, Gen Z spends over 8 hours online and watches over three hours of video content each day. So it’s no surprise that YouTube, Instagram and other social media platforms massively influence how younger generations make decisions, especially about what they purchase.
Although influencers such as Kylie Jenner and Cristiano Ronaldo could strictly be called celebrities, they are most recognised for their selling power through social media posts. Kylie Jenner is worth a reported $1 billion dollars, thanks to her makeup line and endless endorsements, which she promotes via her social media platforms.
With more opportunities than ever to make money online and be your own boss, success often depends much on your personal brand. More people than ever are focused on creating their personal brand by building up their social media accounts, such as Instagram.
Risks of Influencer Marketing
From country to country, influencers and their reach differ, and the influencer marketing industry is now worth around $16 billion. Influencers can transform products and businesses, and their effectiveness has been well established. As with anything else, especially online-based businesses, there are always pros and cons.
One downside of influencer marketing is the risk of account takeover fraud. Fraudsters often target pre-existing accounts to either acquire more data or to extract monetary value. Some celebrities and influencers who have fallen victim to account takeover fraud have been Elon Musk, Kim Kardashian, and Jeff Bezos. The Amazon CEO’s Twitter account was taken over in 2020 by scammers, who tweeted with a promise of free Bitcoin. For individuals or businesses trying to grow their personal brand, enhancing your security against account takeover scams, such as device fingerprinting and IP analysis, is essential.
Another risk or downside of influencer marketing is its mostly unregulated nature and the risk of misinformation being spread. Especially vulnerable are children and young adults to false or misleading claims. The good news is that stricter rules are being introduced, for example, a simple step like the need for #ad on a promotional post. YouTube videos are also now required to state if it is sponsored content. In the United Kingdom, the Advertising Standards Authority regulates and manages online advertising.
Influencer Marketing Approach
Influencer marketing is all about building genuine relationships, but how to successfully approach this can be a little trickier than you might think. One powerful marketing avenue to take advantage of is micro-influencers. What are micro-influencers? Usually, someone with between 1,000 and 40,000 followers on social media can be considered a micro-influencer and often viewed as more authentic and genuine than mega influencers. For this reason, they are more trusted by their followers. Kim Kardashian is far from a micro-influencer, for example. Surprisingly, more followers do not actually mean more engagement. There is 60% higher engagement with micro-influencers over big-name influencers. Another appeal of micro-influencers is that they are far cheaper than big names. There are lots to choose from.
Instagram is one of the most powerful tools that can be used for influencer marketing, as it is easy to target potential customers and endorse brands through this social media platform. There are now lots of marketing agencies that can connect you with influencers, whether they are micro or more prominent influencers. Unsurprising most firms now budget for both traditional content marketing and influencer marketing. The percentage of the budget dedicated to influencer marketing has increased significantly over the last few years, which indicates marketing companies trust the content marketing effectiveness of influencers. The favourite platforms utilised are Instagram, TikTok, Facebook, and YouTube. For micro-influencers, the highest engagement comes on TikTok with 9.38%, followed by Instagram with 7.2%.
One well-known example of how well influencer marketing works is when PewDiePie teamed up with filmmakers to promote a horror movie. The YouTube influencer created a series of videos filmed in the catacombs of Paris, and the YouTube videos received more views than the film’s trailer. There are clear benefits, including improved brand awareness and visibility. A long-term strategy for most businesses is far more beneficial than single promotional posts. Just as time is vital for building trust within any business relationship, the same is true when building influencer relationships.
First, set a marketing campaign goal and budget, and do some research on potential influencers. You don’t need to be a big business to set aside a large budget for market influencers. Don’t just look at numbers. But instead, you need carefully examine analytics and demographics. When building a relationship with influencers, be friendly and engaging but very clear on what your expectations and goals are. You then need to negotiate the terms and conditions of your relationship going forward, including content type, a timeline, and how you would like your brand promoted. Lastly, offer an attractive deal for your influencer’s services.
