We have all seen and heard of celebrity endorsements. While they remain relevant and can still increase revenue, there is a newer, more cost-effective method of advertising and selling products: influencer marketing. Influencers are everyday people on social media who have developed a large following based on the popularity of their content. They exist across all social media platforms, including YouTube and on personal blogs. When they post about a particular product or service, it is likely that their followers will become interested in using that product as well, especially if the influencer focuses on one niche industry or hobby and has demonstrated expertise and credibility in that area. Millions of followers = millions of potential new customers.
Many brands have clued into the impact that can be made on consumers by using influencers to promote their products, and have realized what a lucrative tactic this can be for reaching their target demographic. With the rise of ad blocks, fast-forwarding through commercials and the overall rejection of traditional advertising from millennials, influencer marketing makes it so companies can reach a niche audience in a manner that is neither invasive nor annoying.
Social media has become accustomed to hosting this type of content, with features from Twitter and Instagram that display when a post is sponsored. This helps gain trust from the consumer and avoid questions about whether the brands and influencers are adhering to FTC guidelines. Before the FTC was regulating this content, there were many instances where influencers did not disclose that they were being paid to post, which in turn cost them their honest reputation and, depending on the severity of the situation, hundreds to thousands of followers.
The cost of using social media influencers for marketing campaigns can be much less expensive than hiring well-known celebrities who can charge anywhere up to six-figures for a single post. Social media stars often have fewer followers, which equate to lower pay rates. This tool allows you to compare statistics about engagement, followers, and cost per post between celebrities and influencers. Celebrities such as Kim Kardashian, who boasts over 100 million followers, can be paid up to $500,000 for one single post. Kim, herself, has even caught on to the effectiveness of influencer marketing, which is why she partnered with many popular beauty YouTubers to promote the launch of her cosmetics line, KKW Beauty that launched in 2017. Kim even hosted a lavish launch party at her home and invited a slew of influencers to preview the products before they were released. Attendees were encouraged to snap, tweet and post from the party to get their followers excited and buzzing about Kim’s new line.
Many well-known brands have adapted to this new and exciting way to reach new customers, and they have seen the benefits. Out of all of the companies who use influencer marketing, 94% have said that they believe this method is an efficient way to advertise. The success is due to the authenticity of the influencing posts, as they come from people who prospective customers find relatable and likable, which encourages viewers to engage with “likes” and comments. Viewers also feel as though they have a choice as to whether or not they want to partake as opposed to a traditional one-sided advertisement that is being forced upon them.
Just like any other marketing strategy that is tested, companies must measure the effects on reach and ROI after sponsored content has been posted. However, 78% believe that determining the return on investment [ROI] is the most challenging part of this strategy. Since the rise in popularity of influencer marketing, many platforms such as TapInfluence have been created that allow companies to select influencers who are a good fit for their services or products, and then measure the data and performance of the post afterward.
2018 presents a tremendous opportunity for advertisers to expand their branded content to platforms other than Instagram, which is by far the platform used most frequently for influencer marketing. Companies will soon start putting more of their marketing efforts (and budget) into this successful strategy, and we will see some of these influencers rise to the same status of stardom as some of our favorite celebrity endorsers!
What are your thoughts about social media influencers? Do they have sway or nay?