Influencer marketing is a hot topic among top tier marketers and brands. It’s one of the innovative and new ways to market your product on social media and online networks. Influencer marketing provides an opportunity to reach out to a niche audience. Thus it would be interesting to know how influencer marketing works, their conviction, and economics behind influencer marketing.
Influencer marketing is disrupting the older rudimentary concepts of advertising and consumer behavior passed on from generation to generation of advertisers. Nano, Micro, & Macro influencers are changing the way we perceive and buy products.
The Etymology of Influencers
The one who influences your buying choices is an influencer. These people are like celebrities in a world driven by content. The collaboration between an influencer and brand is a marketing campaign to reach the correct demographics and audiences.
Influencer marketing is imperative to reach your niche customer base. Influencers are the creators who attract more traffic, improve brand awareness, and make sure your brand’s message reaches your intended customer base.
Modern-day influencers are a fantastic way to directly reach the ideal audience across all the social media platforms.
Imagine you have to buy a smartphone. It is 100% possible that your final buying decision is influenced by someone over the internet.
Understanding influencers in the contemporary world
Influencer marketing is an essential way to market a product or service in the modern world. Thus it is important to choose a creator or influencer from the swarm of creators available to tap into your niche consumer base.
The decline of traditional marketing is the signs of ongoing advertising evolution. Thus total spending on influencer marketing is increasing every year. This drastic rise in influencer marketing spending gave birth to social media marketing and influencers.
Influencers are further divided into
- Nano: These are the people with the following ranging anywhere from 1k-10k. These people share close ties with the majority of their followers and community. These people with small following share strong opinions, high engagement rates on an affordable budget.
- Micro: These are people with followers ranging from 10k – 50k. You can expect an engagement rate close to 5-6% of the total followers. Micro influencer campaigns are growing in demand due to their follower’s genuine interest in their content.
- Macro: these are the people a tier down the celebrity status with followers ranging from 500k – 1M. Their engagement percentage comes close to 1-2%. This percentage keeps decreasing as you move up the follower’s ladder. However, reach for macro-influencers is always much higher due to the number of followers.
Why influencer marketing work?
Let me give you two main reasons it to work:
- Word of mouth marketing: one of the earliest forms of marketing known to human society. The influencer marketing model is loosely based on this technique. You like or use a product you provide a recommendation to someone looking for the same product.Now, this recommendation can be biased or fair. Earlier, this used to happen between smaller closed groups and acquaintances. With the advent of social media, you have a medium to amplify your voice and reach millions or billions with a single broadcast.
- Social proof: Let me illustrate a scenario to make you understand the social proof.Do you remember the internet where things used to be pretty simple?Earlier finding “credible,” information was a lot simpler. While in modern times sometimes even gathering the right information is a lot of hassle. As you’re constantly bombarded by more information than you can process.Even if you find the information you’re looking for to check the credibility, you have to go through other sources to verify the gathered information. Reliability is one of the main reasons people follow influencers for credible information.
Checklist to find the right influencer for your social media marketing campaign
- Know your target audience, and influencer’s in that space.
- Find an influencer who perfectly aligns with your brand’s values and vibe.
- Through research on the previous collaboration and work is essential.
- Request data (analytics) from influencers of their previous brand collaborations and campaigns.
- Always keep in mind, social media platforms are important. Where are their followers, and where are yours.
Is influencer marketing expensive?
Yes, it is expensive.
Influencer marketing started as an experiment is now a global multi-billion-dollar phenomenon. The numbers are just bonkers and show the exponential growth across all the platforms. For example, a Facebook status update from an influencer cost $8 in 2014 now, cost $385 in the contemporary world.
That’s a 49.4 times increase over just five-six years. This hike is shared among all platforms you choose to market your product. Be it Instagram, Twitter, YouTube, TikTok, or a blog post. There has been a drastic increase over the last five years.
Influencer Marketing fact: Influencer marketing delivers 11X higher ROI (return on investment) compared to other networks.
Why should you invest time, money, and resources on influencer marketing?
Mutual Benefits: Influencer marketing is a mutual thing where both the influencer and the brand are benefiting. For the influencer, a benefit can be monetary, while for the brand, it can be multiple things according to their end goal.
First, the brands get amazing high-quality content and social media shares via influencer’s audience. For mutual benefits of employees and management use a cloud-based attendance management system. This partnership helps to push the target audience further down in the marketing funnel without gaining notoriety and suspicion from the consumer.
High-quality organic link (Boosts SEO): These brand mentions and social media shares from influencers also help you create high-quality organic links, which can boost your SEO. These organic links further ahead improve your site’s Google ranking while attracting more than usual traffic.
Reach new niche target audiences: This is one of the most critical points running the influencer marketing show. Modern-day influencers are crucial links between the target audience and the brands.
Brands are looking for someone who can guide them to their niche audience. While influencers are looking for new opportunities to create content ideas, promote brands, spread credible and reliable information.
Reasons to take action (Conversion): As mentioned above, an influencer caters to only selected niche audiences. For example, a fashion influencer with lots of content related to fashion will amass people interested in fashion and fashion trends.
Therefore, all of his social media disciples are likely to follow fashion in some way. Thus they are more likely to buy a product recommended by the influencer. His disciples are already on the second step of the marketing funnel called consideration.
This way, this niche audience is just a step away from being converted into a consumer.
Build trust: With the internet and communications channel growing drastically with each passing year. The consumers are also questioning the false advertisements and claims made by brands. A contemporary consumer expects total transparency and truth from brands.
For a brand to build this trust and transparency will take an enormous amount of time and money.
While the right influencer can make your life a lot easier. As people trust influencers as their own friends. According to a twitter survey, 40% of consumers have purchased a product under influence. On the other hand, the YouTube conversion rate is as high as 60%.
A credible source of marketing: As mentioned above, looking for information on the internet is very easy. But looking for credible sources with verified information is equally tricky. Thus you rely on individual creators for trusted information.
Because they share a lot of common traits with people, they differentiate themselves from celebrities. They are more like virtual friends to their followers. Who provides credible Information and unbiased recommendations.
Best examples of brands that made it big through influencer marketing
- Daniel Wellington
Influencer marketing in 2020 is omnipresent and moving further ahead; it will be synonymous with social media marketing. According to the survey, it is likely to grow at this drastic pace. Within a few years expect money spent on influencer marketing to beat money spent on traditional marketing platforms.
I would also like to predict with the engagements growing micro-influencers will be more important in the world of social media marketing. And brands will increase their influencer marketing budgets due to the solid return on investments.
With this current pace will see more and more social media platforms to integrate the buying selling model to engage influencers, brands and customers likewise.
Divyang Metaliya is a Business Consultant at FactoHR, an India based HRMS Software solution provider. He is a creative business strategist with more than 8 years of experience.