Why influencer marketing is eating the cake of traditional advertising budgets
Marketers are constantly adjusting their strategies to pinpoint the best ways to reach consumers through digital channels.
Nowhere has this been more prevalent than the boom in influencer marketing, which has seen a huge surge in popularity in recent times. Let’s face it, Zoella is now a household name to many of us, and she’s not alone.
But simply having a few forward-thinking and technologically-adept millennials making YouTube videos and taking some well-edited pictures hasn’t been the sole driver of this category.
It’s just another key ingredient into the marketing mixing bowl. It is however, one that has completely reset the recipe, to continue the cooking analogy.
The most successful campaigns now combine influencer marketing content boosted by paid social advertising, to result in maximum exposure and brand coherence.
In a world where consumers digest their information across multiple social platforms, websites, apps, print and new media, it’s important for the brand message to be consistent across multiple access points.
Yet where is the bang for buck? Is influencer marketing a savvy place to splash the cash or just another fad, soon to be over-regulated, over-saturated and over-priced? Not according to most.
Is influencer marketing worth it?
A study recently conducted by SocialChorus found that influencer marketing campaigns can capture up to 16 times more engagement than owned or paid media. Influencer platform Tomoson - from a study of top marketers - found that influencer marketing was the most cost-effective digital marketing tool, outpacing display advertising and email.
There should be little surprise that brand marketing budgets heading into the influencer category are growing exponentially
The truth is, production costs are lowering. In fact, the influencer is largely replacing the role of the model and photoshoot for product campaigns.
Influencers have become so advanced in their production skills that brands no longer need to hire professional photographers, models and locations to create beautiful content for their brand as they would with a traditional advertorial shoot.
Influencers include all production costs within their fees, which are impressively lower than a traditional production.
This is coupled with the fact that average CPMs are falling across the board. There are figures all over the internet looking at specifics but, on average social media advertising is three times more expensive than influencer marketing.
As well as lower production costs, influencers also charge a lower amount per view, impression or engagement than you would pay on a Social Media platform.
The real figures
We wanted to check, so we ran the figures though our own proprietary software. Regardless of the platform, the outcome was the same. Taking cost per thousand views as the benchmark.
You Tube stands at around £60 - 80 with paid advertising and drops to £50 - £55 with influencer marketing. Facebook too sees a similar drop off with the average of paid at around £30 - 40, dropping to £10 - £15 with influencers.
Instagram was much closer, although the difference is still quantifiable, with a shift from £8 - £15 down to £7 - £14.
The adblocker issue is also a contributor. There was a quote doing the rounds that you are more likely to die in a plane crash than click on a banner ad. I’m not sure if that’s true, but if it is, it’s great and indicative of the situation the advertising industry finds itself in.
With the rising popularity of adblockers, many paid digital ads are not even seen by consumers.
According to a new report form PageFair and Priori Data, one in five smartphone users - nearly 420 million people worldwide - block advertising when browsing the web on cellphones. That represents a 90% annual increase.
But here's what it comes down to
And finally, we get to the brass tacks. The currency brands value above all else - engagement.
Influencer marketing creates higher engagement than brand posts. The average engagement on a brand post is 0.5% whereas the average for an influencer post is 2%.
Social analytics company, Locowise, found that brand pages’ engagement rates for Instagram are 0.84% and Facebook 0.53%.
The low engagement of branded posts is a result of more brands competing for engagement, the increase of Instagram advertising and the fact that Instagram users now follow more accounts than they did before.
Discerning audiences tire of continuous staged product shots.
With more and more brands working with influencers to create fresh content that feels more real and tells the brand story in creative ways, there should be little surprise that brand marketing budgets heading into the influencer category are growing exponentially.