Influencer marketing is becoming increasingly complex for brands.
Gone are the days when founders could easily cold DM influencers and get them to post about their brand in exchange for free products. Now, as more people realize how lucrative the influencer field can be, creators are raising their fees and becoming more likely to work with dedicated talent agencies to help negotiate bigger deals. There is. The average campaign revenue earned by Instagram creators increased from $3,653 in 2021 to $5,111 in 2022, according to a 2023 report from Hashtag Pay Me, a sponsored post-price network.
Meanwhile, young brands are having to find witty ways to connect with influencers while facing pressure from agencies that spend large sums of money to work with them. Some small brands have found success by gifting products directly to influencers in exchange for reviews, but acknowledge that as their business grows, this tactic becomes harder to scale. At some point, big brands often find themselves having to rely on talent agencies to match them with the type of influencers that will be most effective based on the brand's needs. While this process can help streamline influencer relationships and campaigns, it also comes with longer schedules and higher monthly fees.
Tina Sim, vice president of marketing for skincare brand Euphoria, said her three-year-old company is minimizing paid influencer campaigns because they don't guarantee sales and cost thousands of dollars. he said. “There are some models and creators that I've worked with in the past, but now they have agents and can't pay them,” Sim said.
said Lisa Guerrera, co-founder of skincare brand Experiment. [influencer marketing] On the brand side, it has become difficult, especially for brands that have outsourced their programs. “Many influencers also don't really understand ROI,'' she said, which can lead to mismatched expectations.
Guerrera has an advantage in that she is also a TikTok creator herself. Guerrera has 61,000 followers and 2 million likes on TikTok, where she primarily posts educational content about beauty ingredients. The experiment began test operations in 2020, before officially launching in 2022. To increase awareness, Guerrera said he is personally working on producing organic content with a select group of creators in exchange for free products. Some of them are her friends.
“For a small brand like us that's just starting out, gifts still make the most sense to build relationships,” Guerrera said. Gifts, also known as product seeding, are not guaranteed to be successful for every brand. This practice involves submitting products to influencers in the hopes that they will post or review them on social media. But often, it takes a high-value viral product for an influencer to get excited about promoting it. In a 2023 Traackr survey of marketers, 61% of respondents said less than half of influencers who offer gift products post about them on social media. I answered.
Guerrera said that while this one-to-one approach takes much longer to scale, “we ended up finding a much better return on investment.” So far, the company has consistently used this strategy to achieve product sales. For example, the brand's Super Saturating Serum sold out twice last year.
Teresa Bischoff, head of brand marketing for wellness brand Apothecary, said that from her experience, the company finds micro-influencer and macro-influencer partnerships successful. Last year, the company built a network of over 600 influencers. Apothecary launched in 2020 but rebranded last year. As such, Apothekary wanted to invest more in influencer marketing to better educate people on how to use the product.
“We've learned that authenticity trumps beauty,” Bischoff said. For example, Apothekary initially created his recipe videos for sophisticated mocktails using wine substitutes, but soon realized that viewers preferred to see tinctures used in realistic, everyday content. I realized that. Moving to scrappier, more raw video has proven to be a successful conversion. In recent months, the company has given mixologist influencers the freedom to concoct their own mocktails using Apothecary's tinctures. Previously, the company worked with creators on professionally shot, polished clips.
But now, “we've given them creative freedom instead of obsessing over the details,” Bischoff said. Another factor that contributed to his improved ROI at Apothekary was the promotion of special offers. “A typical 'click the link below' call to action didn't work for us,” Bischoff said. However, offering influencers limited-time offers, such as “no minimum purchase for today only,” is much more appealing to their followers.
Still, Bischoff said challenges persist for influencer marketing. Specifically, “ambiguity in KPIs can make it difficult for an influencer to measure the impact of his campaigns.”
That's why brands like Apothekary are increasingly looking to measure the performance of influencer campaigns in the same way they measure digital advertising. Testing different tactics has become as important as finding authentic voices to work with.
Agencies also recognize that brands need better measurement and that they need to make sure all parts of an influencer campaign are working toward the same end goal.
Alisha Birch, founder of branding and design firm Square Root Creative, whose clients include Nestlé and Hasbro, says that today's influencers have intermediaries, agents and talent management, and that “they have no real engagement at all.” “We are calculating the absorption rate based on the total number of follow-ups without taking this into account.” However, the problem is that views and mentions don't necessarily translate into sales or revenue.
Birch said that Square Root has tried to use industry-specific influencers in its clients' marketing campaigns in the past, but has seen “little to no ROI returned to the brand in the form of sales or web traffic.” “It was,” he said.
Birch said Square Root has found success by leveraging local and regional “brand advocates” who have fewer total followers than professional influencers. “communication [with this type of talent] There are no brokers out there that are proving to be much better and jacking up prices,” Birch said.
Shana Davis-Ross, founder of influencer management agency Ponte Firm, said when working with brands, it's important that both the agency and talent have a clear understanding of the company's goals. This can range from building broad public awareness to launching a new product. Also, the agency, company, and influencer should all align on whether there are specific sales figures the brand is trying to achieve.
“Our creators know what content performs best on their channels,” says Davis-Ross, but it’s important to test different creatives to get noticed. “When something doesn't work, we often ask our talent to give us more creative freedom with the content they're creating on behalf of our brand.”
Youthforia's Shim said one of the benefits of working with an agency is that it streamlines the process of working with many influencers and helps standardize fees. However, there are also some drawbacks. First, more political parties will receive a share of the total tax rate, leading to longer timelines and sharper interest rates. “For him to get $25,000 requests for one TikTok post is not possible for us at this point,” Sim said. “I may love this talent, but I'm only three years old and I can't do that.”
Youthforia has only had two rounds of paid influencer campaigns so far, and started working with paid influencers about a year ago. “The results have been good in terms of enjoying working with these creators, but the conversion results have been mixed,” Sim said.
As a result, the brand still mostly relies on product gifting to generate word-of-mouth buzz. To support the brand's influencer program, Euphoria introduced an ambassador program a month ago that included a dedicated segment for university students, and so far around 600 people have signed up. Ambassadors receive free products and special discounts in exchange for posting about Euphoria products.
Experiment's Guerrera says that even though the influencer model is becoming more structured, “I don't think a cookie-cutter growth strategy is the way to build a trusted brand that people love for the long term. ” he said.
With so many brands competing for attention, influencers ultimately have to love the product, Guerrera said. “If your product is useful, [influencers] You get the views they post about it, whether paid or free. ”
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