Influencer Marketplaces: The new startup trend
From the original Silicon Valley, to Asia’s Silicon Valley (Singapore); from the Silicon Roundabout to the Silicon Cape; and all the digital cities in between; startups continue to lure the Converse and hoodie set to their largely hipster offices (or more realistically, their favourite coffee haunts!).
The ever increasing number of start-ups is largely down to technological advancements, chiefly that technology makes it easier for entrepreneurs to connect with angel investors and crowd funding. Ironic then that the current wave of start-ups are focusing on making connections between brands and influencers, influencers who may not be able to sustain their video careers without some injection of cash. Much like start-ups in their initial phase…
A quick search of AngelList shows that there are currently 109 influencer marketplaces listed, with 936 investors at an average valuation of $6.1 million. These ‘marketplaces’ are predominantly based in the USA, though there are a scattering of European start-ups in the mix. The common goal of all these start-ups is to allow influencers an opportunity to connect with brands looking to boost their presence on social media. Generally the product placements and/or mentions are subtle, with the influencer simply incorporating the product into their usual style of content. It is claimed that this adds a level of authenticity that traditional advertising sometimes lacks.
One of the most well-known of these marketplaces is FameBit who claim to have “21,000 creators in its influencer network which reach over 1 billion people all over the world.” That’s 1 billion people that may not have been reached through more traditional advertising methods, as audiences move from television to YouTube. Marketers have been quick to jump on board this trend, with social media marketing spending tipped to have doubled in 2015.
The larger impact of this change in viewing habits is that the new generation no long fawn over television and movie stars, but align themselves with their YouTube favourites. Variety put this down to the fact that current YouTube stars are “genuine and relatable”, though additionally there is the fact that audiences can often engage and communicate directly with the influencers through their YouTube pages. As Hubspot stresses, brands that wish to improve their communication strategy should aspire to be authentic, to show their personality and to converse with their fan base… just as influencers do!
In practice, it has been observed by Lewis Shields of N2N and Fuel Communications that:
“Influencers generate an even higher rate of conversion, directly driving 30 per cent or more of the overall ‘end-action’ on a brand’s website by recommending it to their engaged network. Digital and social analytics mean that the impact of influencers is entirely measurably, and we’ve seen the ROI to be significantly higher than traditional digital channels.”
For the system to work properly though, it is essential that influencers receive something in return. And it is for this reason that in developing SushiVid, I have ensured that payments to our YouTube influencers are guaranteed. There will be no brands absconding with pay cheques in our shoal! Beyond ensuring that our community of influencers will always have sushi on the table, I believe that this will help to ensure that a high quality of Asian content will find its way to YouTube, so we can continue to enjoy what our influencers produce.
Given that influencers are uniquely poised to promote brands in an authentic and organic way, we need to ensure their longevity. And, with their positive impact on conversion and sales, it’s hardly surprising that influencer marketplaces have become the latest start-up trend.
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