From getting paid too much to being chosen simply based on the recommendation of the CEO’s child, it raised some interesting questions. And as influencer payments continue to grow, some are beginning to question the return on investment of influencer marketing in general.
So are we in some kind of influencer bubble? Are influencers really being paid too much?
Add some zeroes to that figure
“We threw too much money at them and did it too quickly.” Some people may be shocked to learn that influencers can be paid hundreds of thousands of dollars just to “take some photos.” Brands are forking out serious cash to access influencers’ audiences, who may otherwise be resistant to their advertising.
And those payments have continued to rise each year as brands recognize the effectiveness of influencer marketing. In fact according to SocialPR Chat, marketers that implemented influencer marketing campaigns earned an average of $6.85 in media value for every $1 they spent on paid media. And 81 percent of marketers say influencer marketing is effective.
But as the price tag continues to climb, it becomes more and more important to justify the cost.
Metrics matter: The importance of demonstrating ROI
“We paid $300,000 for a few photographs because the CEO’s kid liked someone.” “Too much” is a relative term and impossible to discuss without considering the value influencers bring. Determining that value relies on metrics.
As costs increase, it becomes more important to have reliable metrics. When you are spending $300,000, you want to be able to clearly say, “Yes, this is worth this cost.” Although reach and engagement are effective for measuring influencer campaigns, a more comprehensive approach may be needed to justify big-dollar decisions.
Influencer marketing ROI can be measured by comparing results with additional metrics, such as overall brand sentiment and media mentions. They can also be correlated with spikes in web traffic or higher conversions in concurrent ad campaigns. And as social media channels develop, it is likely to become easier to track purchases from within the platforms themselves.
The better the metrics, the better we will be able to evaluate the success of influencer marketing on a case-by-case basis, and not through sweeping generalizations about the industry as a whole.
Like any other marketing channel, influencer marketing requires strategic planning and ongoing management. It should form part of the marketing mix and contribute to a broader strategy, and not be done simply for the sake of it.
You wouldn’t let the chief marketing officer’s 13-year-old son do your media planning, nor should you let him determine which influencer you work with.
But in addition to measuring ROI to justify the cost, there are a number of other challenges brands face when working with influencers.
It’s hard to hand over the keys
Great influencer marketing gives a lot of creative freedom to the influencers. But brands can have a hard time giving up control of the content. It’s understandable: After all, it takes trust to give a young kid the keys to the Ferrari.
What if they miss the mark completely and crash it into a wall? What can brands do then?
This is an understandable fear and one that needs to be overcome to successfully move forward with influencer marketing.
New influencer marketing platforms are taking steps to help to remedy this problem with clear and consistent briefing functionalities to help achieve that clarity up front. It allows brands to provide the right amount of guidance without getting too prescriptive.