Due to the relative lack of data on what specifically drives ROI in regards to influencer marketing, it can sometimes be difficult for brands to build the right influencer networks to push their products and services.
Thanks to the recent L2 Intelligence Report: Influencers, the picture is a bit clearer. The main findings suggest that brands should refocus their decision-making on two main aspects: the influencer’s audience size and perceived authenticity. On top of this, brands should look to leverage influencer content in more areas than just social media.
The State of Influencer Marketing
In the past few years, influencer marketing — the use of social media personalities to market goods and services — has skyrocketed as consumers increasingly look to their most trusted internet celebrities for purchasing decisions, while at the same time becoming more skeptical of traditional marketing practices.
The L2 report, based on an analysis of over 1000 brands with over 5000 influencers, found that over 70 percent of brands deployed influencers on Instagram. Brand sectors such as luxury, activewear, and beauty employed influencers almost ubiquitously, while consumer electronics, food and beverages, personal care, and home care were slow to jump on the bandwagon. According to the report, influencer social media accounts generate more than double the engagement of brand social accounts with a similar number of followers.
The use of influencer marketers doesn’t appear to be slowing down anytime soon. A recent Forbes survey of Fortune 500 companies found that 84 percent plan to launch at least one influencer marketing campaign in the next 12 months. Another study by eMarketer revealed that almost half of brands using influencers would increase their influencer marketing budget in the coming year.
Existing Brand Strategies
Most brands can’t shell out millions of dollars to bring in the loudest voices on the internet to promote their brand. For this reason, it’s important for brands to get the biggest bang for their influencer marketing buck. The report cites three brand types and the strategy they most often implement: “Small but Mighty,” “Playing to the Middle,” and “Outsize Bets.”
The first type of brand, “Small but Mighty,” build networks of smaller influencers that closely match the style and values of the company without needing them to amplify brand awareness in major ways. Instead, these brands opt for user-engagement through highly targeted endorsements. While it is a great way to engage consumers on a small-scale, this strategy fails to build excitement for their brand in the same way mega-influencers can.
“Playing to the Middle” brands use a heavy mix of small and large influencers to push a diverse stream of marketing content across social media. The deep pockets of these brands allow them to build long-lasting influencer relationships that drive long-term increases in brand awareness. The major weakness of this approach is keeping a consistent and concise brand image through the huge mix of content promoted by its varied group of small and large influencers.
“Outsize Bets” brands deploy influencers with much bigger audiences than their own to market their products and services. While this type of influencer marketing can massively boost brand awareness, it is often a huge investment by the brand and can easily backfire if the famous influencer’s credibility or authenticity is in question. These companies typically bring on board smaller influencers as well to reach more niche consumer segments.
Macro or Micro Influencer?
So what type of influencer marketing campaign should a brand go for? According to the report, that depends on the brand’s underlying priorities.
For brand’s looking to build brand awareness and reach generally, mega-influencers are the way to go as their large followings can open up new audiences. In particular, the L2 report found that celebrity influencers are best used in conjunction with product launches or bigger tent pole marketing campaigns.
Unlike mega-influencers, brands looking for a tighter and more controlled brand-building campaign should employ a network of niche influencers that are well-trusted and know their stuff, whether it’s fashion, art, or music. As these micro-influencers grow, they can extend brand-awareness to new consumer segments with similar tastes and values.
“Celebrity in influencers may work best with product launches and tentpole campaigns, but the network effects of micro influencers can increase brand awareness and engagement with new consumers,” a new report says.
According to L2’s research, the smaller the influence, the higher the engagement. For example, “advocate” influencers (0-5K followers) and “micro” influencers (5K-25K followers) have 8 percent and 4 percent engagement rates, respectively. “Mega” influencers (1M-7M followers) and “celebrity” influencers (7M+ followers) share a 1.6 percent engagement rate.
Influencer Marketing Equals Higher Engagement
Brands with strong influencer marketing strategies saw the highest engagement rates by far on their own social media accounts. L2’s explains that it is likely that “influencers may have a halo effect on brand account engagement as well.”
The report points to Beats, Coach, and Alex and Ani as good examples of this — all three own above average brand engagement rates on their social media. Beats does this by deploying a host of musical and sports celebrities on their social media accounts, particularly Instagram.
Coach’s landed an endorsement and product deal with Selena Gomez (127 million Instagram followers) that played a huge factor in ramping up engagement. Alex and Ani use a mix of content across its social media accounts ranging from sourcing user-created content and product giveaways to getting behind social causes.
Beyond Social Media
“Leader brands deploy influencer content beyond social, using them and the content they produce in email, display, and traditional media campaigns to maximize their ROI.”
The most successful influencer marketing strategies, according to the study, push content beyond just social media, capitalizing on it in more ways than just one and, in turn, maximizing ROI. More specifically, the brands use the influencer content on a wide range of platforms like email, display, and more traditional marketing campaigns.
It is a simple and straightforward tactic, but the L2 research finds that most brands (90%) fail to even publish influencer content on their own social media accounts, unnecessarily missing out on using the content in a more diverse way.
Authenticity Is Imperative
One of L2’s main recommendations is that brands should be picky when choosing an influencer to represent a brand. Influencers who seem out of place or who aren’t credible can in the best case be unsuccessful and in the worst case tarnish a brand’s reputation.
Finding influencers that are trustworthy and who authentically fit your brand is a massively important factor in a successful influencer marketing strategy. This means carefully considering an influencer’s previous content and sponsorships.