In many cases of popular consumer brands, sales were doing amazing in the '90s and early 2000s, without much proactive effort on their part. Most were flying high, but then trends changed, demand waned, e-commerce caught on, other smaller indie companies started creating their own versions of the same product and started eroding market share. Sound familiar?
Without naming anyone in particular, think fashion, TV, cosmetics and it's the exact same story. If it hasn't been obvious enough, brands need to be proactive with their marketing. And the fastest way to do so is through influencer marketing.
Why influencer marketing?
Many brands have various target audience age groups, but to create a halo effect and grow interest, it is a must to go after a younger audience – Males and Females aged 15 to 25. It is an audience that looks to their friends and to entertainers to influence what they're going to buy.
With that in mind, it necessarily points to Instagram. There is a large and engaged user base on the Instagram platform – with an estimated 0.5 billion monthly active users globally.
Locally, 25 percent of all Singaporean Internet users (1.35 million out of 5.35 million in 2015) have monthly active Instagram accounts. The same source also states 37 percent of Instagram users were between 16 and 24 years old, Facebook is only at 25%. Furthermore, a lot of these users are already posting images of themselves with consumer brands there – so it is already a common practice.
So how does one execute influencer marketing strategy on Instagram?
Early this year, Instagram launched Stories, a feature that enables users to create stories–a feed of photos and videos that can be customised with your own scribbles, subtitles, and stickers, and displayed for 24 hours only. Sound familiar? This is a blatant copy of SnapChat – it will not be able to replace the original but it will keep users even more engaged than ever.
Influencers can now provide a behind-the-scenes look into the lives of content creators. They can share direct access into their lives with their current fan bases–fans who have been with them throughout their Instagram journey; fans who enjoy their more curated photo and video content.
Real fans of a brand already capture content for them and talk about how much they love it. It is natural to see someone rave online about their favorite restaurant or sneakers, even without endorsements. What any brand needs to do is harness that and utilise it to speak to the core audience in a way that feels genuine and authentic. That's easier said than done.
How to identify high-value influencers?
First, in any given year, a brand should work with influencer marketing platform to tap into the reach of a maximum of three major stars (more than that and it will look forced). All influencers have to be natural everyday users of a brand's product and service, so everything else is just giving them an extra push. It is essentially to have them talk about the brand in an organic way.
Second, brand managers need to be honest with themselves. They can do so by looking at their brand objectives, not just the influencer objectives. The goal is to want to be wherever the core audience is and be a relevant brand in their lives.
Third, make sure that the people contracted as influencers share the brand's values. In terms of KPIs [key performance indicators], do not look for a sale immediately after someone watches a video. But look at the number of views and view duration. Brands should want people to feel good about the brand so that when it's time to make a purchase, they won't pick anything else but yours.
How cost-effective is influencer marketing?
It is probably the best tool in the market right now and it can only get better – with credible studies saying that influencer marketing pays $6.50 for every dollar spent (Instagram being top of the pile when it comes to return-on-investment).
It's an efficient way for brands to reach their target audience because the eyeballs that are bought from a digital marketing ad buy are less valuable than the ones gotten through a genuine influencer who speaks clearly and actively about the brand.
Brands from all industries and sizes are planning to increase spending on influencer marketing. It does look like this tool is on to something great and embracing it in 2017 will pay off well.
The views expressed in this column are the author's own and do not necessarily reflect this publication's view, and this article is not edited by Singapore Business Review. The author was not remunerated for this article.
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Andrea Olivato is Head of Operations at Popular Chips, a worldwide social media advertising agency based in Singapore. He co-founded Digital Marketing Agency Redation SRL, and managed it as CTO and MOB until its acquisition by Softec Spa.