MKTG 3360 Chapter 14 Notes

Someone who carries influence over others

Influencer

Type of marketing that focuses on using influencers to promote a brand message, product, or service to their larger market

Influencer Marketing

Someone who exerts his or her influence through social media

Social Media Influencer

In today’s world, you do not need to be a celebrity or athlete to be an influencer, regular people who are….

passionate about creating content can quickly become online celebrities with strongly engaged social media followers

Over the past few years, influencer marketing has skyrocketed, so much so that it’s now….

considered a staple for many brands’ marketing mix today

In 2023 the spending on influencer marketing increased

roughly 3.5 times faster than traditional social advertising spending

What Makes a Good Influencer

• Reach

• Engagement

• Credibility

• Relevance

• Authenticity

• Activity

• Interaction

The number of people to whom an influencer can deliver a message

Reach

Common misconception on social media influencers is that they need to have millions of followers to be an influencer. Reach alone is not a requirement of being an influencer. Many….

nano and micro-influencers who have fewer followers but have tapped into a highly credible niche audience

1,000-10,000 followers. Typically, among the average social media user who can use their power to influence their close-knit followers like family and friends

Nano-Influencers

10,000-50,000 followers. Hold a smaller reach with very high levels of influencer engagement among their followers

Micro-Influencers

50,000-500,000 followers. Are between a micro and macro influencer, and are industry experts in their niche category

Mid-tier Influencers

500,000-1,000,000 followers. Have an extensive reach and use their influencer status to generate significant income. Macro influencers often warrant representation from a talent manager

Macro-Influencers

1,000,000+ followers. Typically. celebrity influencers with a very large following. They often collaborate with brands on a paid-per-post basis.

Mega-Influencers

Today, 39% of brands chose nano-influencers as their most likely partners, followed by 30% opting for micro-influencers, with…..

19% opting for macro-influencers, and 12% mega/celebrity influencers.

A measure of all interactions with social media content, is seen as more valuable than reach

Engagement

In fact, nano and micro-influencers consistently exhibit higher ______ _____across all platforms. Collaborating with these influencers not only tends to be more budget-friendly but also aligns well with many brands as they often cater to specific, niche audiences of followers

Engagement Rates

Average Engagement Rate by Follower Count

• Nano - 4.39%

• Micro - 2.59%

• Mid-tier - 1.71%

• Macro - 1.44%

Considered more important than reach. Influencers must have the ability to explain things clearly and convincingly to an audience so that the influencer is perceived as trustworthy

Credibility

Ensures resonance with target audiences

Relevance

Good influencers believe in the brand they are promoting and what it stands for, if they are not sincere, they risk alienating their audiences. A shift toward genuine engagement can involve conducting Q&A sessions about the sponsored brand or product or creating videos showcasing the user experience

Authenticity

Peyton Manning received backlash for plugging in……

Budweiser in his post-game speech

Scott Disick received backlash for pasting……

the whole caption for Bootea shake on Instagram

Influencers must be active on social media, publishing content daily or weekly to their platforms. The best social media influencers are often publishing content to stay fresh in their followers’ minds

Activity

Social media is not a one-way street. Influencers must engage with their followers. When followers mention the influencer or ask questions, it’s essential to acknowledge followers by liking or commenting back

Interaction

Combined following of over 200 million on TikTok

The D’Amelio Sisters

_____ rose to stardom in late 2019  as one of the app’s initial major stars. She became the first person to hit 100 million followers on TikTok. ______ boasts a massive following primarily focused on music. The sisters have their own show which renewed for its third season on Hulu named “The D’Amelio Show”. They also host their own competition show on Snapchat called “Charlie Versus Dixie”. It is estimated that each sister gets paid up to $100,000 per episode, the sister who successfully wins the most challenges throughout the season earns a prize of $50,000 which is then donated to their charity of their choosing.

Charlie, Dixie

In 2021, at the age of 18, Charli earned a staggering $17.5 million in branding and endorsement deals, making her the world’s higher paid TikTok start. Dixie, not that far behind, earned….

$10 million.

Amazon, Hollister, Dunkin, and Prada compensate the family approximately….

$250,000 for each post they make

The family have taken a further step in capitalizing on their fame through their own brands, a groundbreaking….

venture in the industry

The sisters attribute their success to a unique strategy characterized by spontaneity and authenticity. They posted when……

inspiration struck rather than on a strict calendar.

Benefits of Influencer Marketing with Social Media

• Increased Exposure

• Brand Awareness

• Improved Search Ranking

• More Credibility

• Effectively Reach a Target Market

• New Leads

• Conversions

When companies or brands partner with influencers, they increase their brands’ exposure to the influencers’ larger audiences

Increased Exposure

Increased exposure and reach ultimately boosts visibility, leading to increased brand awareness. Social media followers will start to recognize and know more about brands and the products and solutions they have to offer

Brand Awareness

Google ranks high-quality organic links higher in search rankings. Incorporating company page URLs into influencer blogs, and social media posts will help drive traffic and improve search engine ranking

Improved Search Ranking

Great influencers have earned the trust of their follower base. Partnering with an influencer to promote a product or brand favorable will provide the brand with an instant credibility with the influencer’s audience

More Credibility

Social media analytics allow an influencer to provide detailed information to brands about follower demographics and interests. With the right influencer, a brand’s content is placed in front of the desired target market already interested in the brand’s niche

Effectively Reach a Target Market

Brands can generate more relevant, high-quality business leads if a brands products are directly related to an influencers’ target market

New Leads

Social influencer marketing also drives conversions. In order to do so, businesses must include a call to action in an influencer’s post. Providing a discount code or giveaway is an excellent way to increase conversions.

Conversions

Businesses generate on average, $6.50 for every….

$1 invested in influencer marketing.

Creating a Social Media Influencer Marketing Strategy

• Establish Goals

• Determine Target Market & Social Media Channels

• Identify and Find Influencers

• Set Up Monitoring and Listening Streams

• Discuss the Partnership and Payment Model

Before engaging with influencers establish your influencer marketing strategy goals. These should be tied to the objectives set in your social media marketing strategies and should always be tied to the business’ goals. It is essential to establish specific KPI’s for each goal to measure the success of the strategy.

Establish Goals

Once goals and KPI’s are established, next step is to identify the right social media channels to reach and engage with the target audience. Conduct research to determine social media use by the target market

Determine Target Market & Social Media Channels

The target audience must trust and respect the influencer’s opinion in order for it to be successful. YouTube stars demonstrate more influence over teenagers when compared to mainstream celebrities. Data from X shows that people aged 45 and up prefer celebrities as influencers.

Identify and Find Influencers

If business goal is for a brand message to reach the largest audience possible then a big celebrity may….

be a good fit, but they are very costly

A study found analyzing 800,000 Instagram users that as an influencers total following rises, their…

engagement decreases

Users with less than 1,000 followers generally receive likes on their posts 8% of the time, while users with 10+ million followers only receive likes….

1.6% of the time

Influencers in the 10k-100k follower range offer the best combination of engagement and broad reach, exceeding….

influencers with higher followers

Before reaching out, set up monitoring and listening streams to track what the influencer is saying and decide how to best engage with them. Brands should engage and interact with a target influencers on social media to develop a relationship before reaching out directly.

Set Up Monitoring and Listening Streams

Influencers derive value from partnering with brands and vice versa, brands derive value from partnering with influencers. Brands need to define the specific benefits of working with influencers

Discuss the Partnership and Payment Model

Benefits to Influencers working with brands

• Financial Compensation

• Free Products or Services

• Free Products or Services to Give Away to His or Her Audience

• A Sponsorship

• Exposure to The Brands Audience or Senior Executives

• Increased Exposure to a Broader Community Including Other Influencers

• Exclusive or Early Access to Products or Content

• Access to Brand Events

As of 2023, majority of brands (41.6%) stated that they pay money to influences, compared to 29.5% who give them free products, 17.7% providing product discounts, and…

11.2% entered their influencers in a giveaway.

The 3 most prevalent payment models for influencers are

• Flat Fee Model

• Commission/Performance-Based Model

• Hybrid Model

Influencers receive a fixed payment amount for their services

Flat Fee Model

Compensation is linked to the influencers’ ability to drive conversions or achieve specific performance targets

Commission/Performance-Based Model

A combination of the flat fee and commission-based approaches, offering influencers a mix of guaranteed payment and performance-driven incentives

Hybrid Model

Creators have become more aware of their worth, with 58% now…

requesting a hybrid model when collaborating with a new brand for the first time

Several metrics marketers can use to determine influencer pricing

• Cost-Per-Engagement (CPE)

• Cost-Per-Mile (CPM)

• Cost-Per-Impression (CPI)

Pricing metric to determine how much they’re paying for each user interaction on a piece of content, such as likes, comments, or shares.

Cost-Per-Engagement (CPE)

Cost-Per-Engagement (CPE) Formula

Price per post = Recent average engagements x CPE channel metric listed below

Cost an advertiser pays for one thousand views or impressions on an influencers post

Cost-Per-Mile (CPM)

Cost an advertiser pays for each impression or view on an influencer’s post.

Cost-Per-Impression (CPI)

Brands are realizing that ___ is not always the best way to measure value, especially for micro-influencers, so they are turning to ___.

CPM, CPI

Cost-Per-Impression (CPI) Formula

Total cost of the campaign (i.e. creator fees) / Total Impressions of the campaign

If a brand requires exclusivity from influencers, like they cannot promote or be associated with any other advertiser for a period of time, creators will…

expect to be paid more as compensation.

Creators may charge additional fees based on the amount of effort required to create the requested content, whether it’s a…

dedicated video or a larger content package

Many creators today expect additional compensation if they want brand ownership of their content. Pricing will generally depend on the duration of time for which the brand wants to repurpose the content and…

where it will be repurposed

Creators may charge higher fees in niche industries like food and travel where…

professional quality is expected from brands

The experience of a content creator on a social media platform can impact their pricing on other platforms. Example - some creators with small audience on one platform may charge a higher rate because they have a….

large following on another platform

Brands that have worked with an influencer for a long time have more….

opportunities to negotiate with them

Pros of Offering Financial Compensation for Influencers

• Makes a more significant impact

• Delivers results quickly

• Greater reach by partnering with influencers with more followers

• Control over messaging - By compensating influencers, brands may have more control over the messaging and content that is being shared with the influencer’s audience

• Better Targeting - Brands may attract higher-quality influencers who are more aligned with their target audience and brand values

• Increased Loyalty - Can help build a stronger relationship between the brand and the influencer, leading to long-term partnerships and increased loyalty

Cons of Offering Financial Compensation for Influencers

• Higher costs that may not be sustainable over the long term

• Lack of authenticity - Paying influencers to promote a product may make the endorsement seem less authentic to the audience, which could negatively impact brand perception

• Limited Creativity - May limit the creativity and authenticity of the influencer’s content

• Potential for negative publicity - If an influencer is not perceived as being genuine or authentic, it could lead to negative publicity for the brand

• Legal Issues - There are regulations surrounding influencer compensation and disclosure, which can be complex and lead to potential legal issues for brands

Incorporate Influencer Marketing Into the Social Media Strategy - Once the partnership has been established, it’s time to incorporate influencer marketing into the social media strategy. Brands can utilize influencers to interact with the brand by

• Collaborating with influencers to create original content such as videos, photos, or blog posts

• A social media account takeover to leverage an influencer’s following to build up a company’s own follower base

• Engaging with the influencer’s followers through Q&A sessions or live streams

• Providing influencers with exclusive access to events or products to generate excitement and anticipation among their followers

• Offering affiliate marketing programs where influencers can earn a commission for promoting the brand’s products or services

• Using influenced as brand ambassadors to represent the company at trade shows, conferences, or other events

• Partnering with influencers to run social media contests or giveaways

• Hosting events or experiences featuring influencers to promote the brand and engage with customers

• Enlisting influencers to provide feedback and input on new products or marketing campaigns

• Offering exclusive discounts or promotions to the influencers’ followers to drive sales and increases brand awareness

In addition to measuring engagements, impressions, and followers, its essential to track specific KPIs and goals set pre-campaign, during the campaign, and post-campaign. The success of the influencer program can be measured by both quantitative and qualitative results.

Measurement

There are many tools that companies can use to identify influencers with engaged networks within a defined market. Some companies can help discover and map the most influential influencers, listen to what influencers are saying, interact with and develop relationships with influencer targets, and provide detailed reporting and ROI.

Influencer Marketing Tools

Dove partnered with indaHash to leverage influencers to drive awareness for its nourishing body wash and generate more engagement and reach among consumers in….

Malaysia

Promoted their all-electric vehicle the IONIQ 6 by partnering with a TikTok creator for branded content and engaged in a branded duet with another TikTok creators. The duet featured the original branded TikTok and involved two TikTokers known to have a relationship

Hyundai

Branded TikTok 1 - Hyundai collaborated with TikTok chocolatier Amaury Guichon who has 22 million followers to transform the car into a life-sized creation of chocolate. The content gained over 35 million views

Branded TikTok 2 - Hyundai collaborated with ChefReactions who critiques food with a duet to the original chocolate video.

Branded TikTok 3 - ChefReactions met Amaury to bring the chocolate car back to Hyundai HQ.

Hyundai Branded TikToks

Released a limited-edition salad dressing in collaboration with influencer Christina Najjar also known as Tinx. They also partnered with Chipotle to provide complimentary entrée vouchers to the initial 10,000 purchasers of dressing on Amazon. The company’s primary success metric was measuring engagement.

Tabasco

In 2022 to promote the new _______, they invited 42 creators to their event with an all expenses paid trip to create content however they want to. They also have a program that allows creators to submit content year-round for a chance to be rewarded with cash or gear with over $50,000 in prizes.

GoPro

Partnered in 2022 with former Bachelorette contestants to launch a campaign to promote their latest rug line. Featured 14 former contestants posing for pictures alongside the new shag rugs with the hashtag #softerside. Campaign doubled its engagement-rate goal, with over 100,000 likes and comments on the influencers’ Instagram posts.

Ruggable

Known as the next generation fashion retailer for millennials, drives nearly 70% of all of their sales through influencer marketing.

Revolve

The reason behind Revolve’s success

• They know its target audience

• They meet the target audience where they are

• Selective, long-term partnerships

• Compensation

• Beyond Social Media

• Ambassador Program

They know that millennials gravitate toward brands that resonate closely with their interests. Social media influencers build emotional connections with followers, and as a result, followers trust their opinions

They know its target audience (Revolve)

this company realizes that their target audience no longer relies on magazines for fashion inspiration. With most of their target audience of buyers on social media, they looked to these platforms to promote their product

They meet the target audience where they are (Revolve)

Revolve just doesn’t work with any and all influencers. They are strategic in the influencers they select to work with each year and have a strategy to ensure each is adequately managed. Some influencers are invited to single events while other long-term influencers serve as the exclusive face of particular clothing lines

Selective, long-term partnerships (Revolve)

Revolve influencers are offered free clothing, travel, monetary compensation, or a combination of the three in exchange for promotion. Revolve has the luxury to work with thousands of influencers for little to no cost because working with Revolve elevates the personal brands of influencers.

Compensation (Revolve)

Revolve engages their audiences beyond just social media posts through various music festivals and events like “Revolve Festival”, a concert and pool party headlined by top artists. In 2019, Revolve provided clothes to more than 750 influencers during Revolve Festival and gained 130,000 Instagram followers and $2.5 million in sponsorship dollars

Beyond Social Media (Revolve)

In 2022, Revolve launched. Anew brand ambassador program to create community-driven marketing opportunities. The program allows Revolve users to apply to be brand ambassadors, where they will operate as influencers and have the chance to win rewards, commissions, early access to new brands, and the opportunity to participate in events. As part of the program, ambassadors create customized storefronts, where they can add their favorite Revolve products and generate earnings from sales. The first soft-launch of the program onboarded more than 3,000 members and attracted a waiting list of 10,000 applicants.

Ambassador Program (Revolve)

Collaborated with David Dobrik to celebrate National Burrito Day. Dobrik took to TikTok to challenge viewers to create videos show themselves flipping burrito bowls with the #ChipotleLidFlip challenge. Campaign received 110,000 submissions within 6 days and over 230 million views in one month

Chipotle

Challenge was so successful that on National Avocado Day in 2019, Chipotle launched another TikTok challenge #GuacDance generating 430 million video starts and 250,000 submissions in 6 days, becoming TikTok’s best performing branded challenge in the U.S. The Guacamole campaign also drove a record day of sales for guacamole with over 802,000 sides served, using 420,000 pounds of avocados to meet the demand.

Aftermath Chipotle

Influencer marketing has proved to be a powerful tool for brands and marketers in the recent years as studies indicate that is has a significant impact on consumers’ purchasing decisions. With increasing competition in the influencer marketing space, it is important for brands to stay up to date with industry trends and constantly innovate their influencer strategies to stand out in the market. As the creator economy continues to grow, the power of influencers is only going to increase, making it essential for brands to understand how to effectively leverage influencer partnerships.

Conclusion