Thanks to a number of factors, influencer marketing is on the rise. Anyone with an Internet connection can become a trendsetter or expert and build a following. Brands are taking notice and are eager to receive an influencer's seal of approval.
Many marketers already have influencer marketing on their radar because it also offers an alternative to display ads that are being increasingly obstructed by ad blockers. Approximately 35 percent of social media professionals polled last year considered their use of influencer marketing to be at a mature stage, and only 14 percent didn't plan to include it in their social strategy, according to Altimeter Group's "State of Social Business" study. But 75 percent of marketers said finding the right influencers was their most significant challenge, reports Augure, a PR and influencer marketing software provider.
Look for Fit before Numbers
Marketers are more likely to find the right influencer for their brand if they focus on "fit" before numbers, advises Brendan Lattrell, founder and CEO of Grapevine. Grapevine operates a platform where marketers upload a description of the type of video content they're looking for and can search a database of video creators/influencers by audience, viewer age range, and product affinity.
"Marketers often get enamored with big numbers, but just because an influencer has a million followers, that doesn't necessarily mean that person's work fits your brand," Lattrell says. "Does your brand story and image align with the influencer's content? That's much more important than a person's reach."
Trust the Influencer
It's also important to give influencers enough creative room to create the content, says Shashi Charles who writes about healthy living on her blog, Runnin Srilankan, where each post gets at least 40 comments. Charles also has more than 6,000 followers on Instagram and 2,600 followers on Pinterest.
Through Collective Bias, a marketing platform that connects brands with influencers, Charles says she only works with brands whose products can be "weaved into" a story authentically. "I always let my readers know when I partnered with a brand on a post," Charles says. "But the product has to be something that I would want to try anyway, and then I'll figure out how to best use it in a recipe."
Indeed, the highest performing sponsored posts "strike a balance between what the brand wants and what the creator wants," notes Holly Pavlika, senior vice president of marketing and content atCollective Bias. "Influencers know their audiences best and so a list of talking points could be helpful, but giving them as much freedom as possible will produce better results."
Use Meaningful Metrics
Of course, sponsored content is meaningless if it can't be tied to results, such as conversion rates and sales. WhiteWave Foods, the parent company of brands like Silk and Earthbound Farm Organic, partnered with tech firms TapInfluence and Nielsen Catalina Solutions (NCS) to measure the in-store sales impact of influencer marketing campaigns.
Using TapInfluence's cost per engagement and audience data, WhiteWave Foods selected 258 fitness and food influencers whose audiences matched the brand's target customers. The influencers created content (and informed readers the content was sponsored) around the brand's products, such as recipes that include Silk Almond Milk for meatless Mondays.
The content was also shared across the influencers' social networks and NCS tracking pixels were automatically inserted into every sponsored post. When a reader clicked over to the post from social media, the tracking pixel cookie was activated and NCS matched the cookie data with similar loyalty card and household data.
NCS and TapInfluence tracked the purchases of the consumers who were exposed to the sponsored content from September to November last year. In the test results, the "exposed consumers" bought 10 percent more Silk products than the control group and generated $285 in incremental sales (per 1,000 pageviews).*
For brands that don't have the same resources as WhiteWave Foods, there are other ways to track performance, such as by giving influencers a coupon code to include in the content or even conducting a reader survey. The important thing is to remember that "if you can't measure something, you can't improve it," notes TapInfluence CEO Rustin Banks. "So it's critical for companies to understand the impact their campaigns are having."
Create Sustainable Impact
Instead of a one-time partnership, developing a relationship with influencers is far more beneficial. Headphone maker Sol Republic is one such brand that set out to build a community of brand advocates. In 2011, the California-based company created a platform for engaging advocates with help from Stellar Loyalty, a consumer relationship software provider.
Sol Republic refers to its celebrity fans like athletes and musicians as "Saviors of Sound" and its consumer advocates as "Soldiers of Sound." To date, the six-year-old company's customer-based community includes more than 30,000 members who create YouTube videos and Instagram posts about the brand.
Fans access the community through an app where they can earn points for activities like posting a selfie or creating a video with a Sol Republic product to earn merchandise and access to events. "Our advocacy program is still a work in progress, but what's worked well is authentically engaging with our consumer base," says Kevin Lee, co-founder and CEO of Sol Republic. "We wanted to build a community of music lovers, not just customers, so we'll do things like provide buses at a musical festival to help people get around and have surprise DJs jump on the bus too."
Lee says he's not overly concerned with tracking the impact of all the content that his company's brand advocates are producing. "We know our brand awareness in the marketplace is much higher than the touchpoints that we can track," Lee says. "And our belief is that as long as we do well by our fans, our brand will resonate."
There continues to be a debate on whether brands should pay influencers to endorse their product. "What we've learned is the people who want to be paid for a recommendation aren't the right people," maintains Tom Stockham, CEO at Experticity, a company that connects brands and influencers. "True influencers balk at being paid, and just want to endorse the products they really like."
On the other hand, some influencers operate like a business and depend on monetary compensation. Regardless of the compensation arrangement, the Federal Trade Commission is bearing down on brands that fail to disclose payments to influencers.
Last year, the FTC settled charges against retailer Lord & Taylor for failing to disclose that it had paid fashion bloggers to post photos of themselves on Instagram wearing a dress for a campaign. Lord & Taylor was also dinged for an online article that appeared in the fashion publication Nylon that wasn't initially labeled as a paid promotion. Also last year, the FTC settled charges against a YouTube-based gaming network called Machinima for not disclosing payments to influencers in connection with an Xbox promotion.
Although the settlement agreements did not include a fine, brands and influencers who fail to disclose payments face other risks. The attention that follows a non-disclosure announcement can hurt a brand's relationship with customers, especially in today's hyper-connected world. Companies may not face a monetary fine but the damage to brand trust could have long lasting effects.
Influencer marketing also comes with drawbacksit's difficult to scale and niche so companies may struggle to find the right influencersbut if used correctly, it can be a powerful customer engagement tool.
*Editor's Note: An earlier version of this article described incremental sales based on 1,000 impressions, but has since been corrected to read 1,000 pageviews.