Will influencer marketing translate into sales?
In the marketing arena, the influencer industry is all the rage. This is a marketing channel for companies to connect with consumers and be part of a conversation which will hopefully result in sales or brand lift. The problem is that the channel is complex and a variety of staff, processes and vendors are required to make an impact at scale. There is little doubt that the mar-tech industry will capitalize on the chaos. Sales will trend upward if the marketer can realize that it’s all about the followers with discretionary income AND the content they create that resonates.
There is little doubt that the mar-tech industry will capitalize on the chaos.
There is some good insight into mar-tech and digital media found here, from Luma Partners. https://www.slideshare.net/tkawaja/state-of-digital-media-2017
The report is delivered through the eyes of an investment banking lens, so keep that in mind as you read.
What excites me about the space
This was shocking to me: Gen X (ages 35 to 49) spends 7 hours per week on social media, according to Neilson. This is more time than millennials spend! Check out the report:
The people spending time on social media are Gen X adults with credit cards. It’s no longer a bunch of kids with no discretionary income. However, there are still undesirable followers of influencer’s who marketers do not want to reach.
There are two main issues at play for marketers who wish to better understand an influencer’s impact:
- Audience size and quality
- Content quality
Audience size is the most obvious but the composition of that audience is even more important. You have to ensure an influencer can prove their worth (i.e. — did they drive sales and can I attribute the sales to them?). Tracking and attribution are still the Wild West in the influencer space. I’ve enjoyed trying tools like SocialEdge, TapInfluence and many others but they are still a “black box” as far as how they arrive at the scoring methods they utilize. When will the Neilson or Comscore of influencers take the stage and help sort out independent tracking and attribution?
Content quality is more subjective. Good storytelling through videos, photo and text is often arbitrary. Vine/ YouTube sensations Jake Paul and Logan Paul remind me of MTV’s Jackass and Punk’d from years ago. It also reminds me what my mentor, Don Ohlmeyer the former NBC President, used to say: “MTV is mostly hype and no ratings. Marketers buy them for hype and for the niche, youth demographic they reach.” My concern is that they do not have staying power, and their audience is so young without income that they can’t achieve high average order value’s (AOV’s) for ecommerce marketers. In the branding world, this audience is so ADD that they won’t sit through preroll ads, resulting in low ad completion rates.
Some of the most unsuspecting (sometimes boring) content subjects may have the fewest followers, but those followers drive results for marketers and make the influencers very rich. Take arts/ crafts for example. A seemingly dull space is full of multi-millionaires (Ipsy, Bando, Inked Brands, Brit + Co, Create and Cultivate, BeautyCon, etc.). These content verticals have staying power by virtue of the type of content they focus on now.
Both types of marketers, brand and direct marketers, are going to have many challenges and successes as they utilize this influencer channel.