Hi. Welcome to expert talks at InsightsNow. In this video, we will talk about the growing prominence of influencer marketing and what are some of the approaches to analyze and build a great influencer marketing strategy.
Many surveys have shown that the ROI on influencer marketing is around ten to eleven times of any of the marketing spend. And this is also evidenced by the fact that this year alone the global spend on influencer marketing is around $16 billion and it is estimated that it will grow at a CAGR of around 30% year on year for the next ten years or so.
Also, platforms like Instagram, YouTube, and Facebook seem to be more given to influencer marketing compared to others. But then there is again no right or wrong answer. It depends upon the industry and the products in which the company operates and the type of social media consumption habits of its end consumers. But the most important part of a great influencer marketing strategy is actually arriving at the set of influencers there are three factors one needs to consider.
One is to reach the number of people that the influencer is able to reach directly and indirectly. Number two is relevance is the influencer and authority in the space in which the company operates and does her beliefs align with that of the companies? Number three is resonance, What is the level of engagement rates that the influencer enjoys with his or her followers or network of connects?
So let’s understand reach first. So if you see in the slide influencer A seems to have 6 connects and influencer B has 10 connects. So one would say that influencer B has a greater reach compared to influencer A.
Now let’s understand this a little more. In this slide, we compare influencer B who has got 10 connects with influencer C who also has 10 connects. However, the 10 connects of influencer C in turn have a few more connects. So the ability of influencer C to indirectly influence a few more people is higher compared to B. So when you look at this slide you would say that influencer C seems to have a better reach than influencer B.
Now let’s look at this slide where you’re comparing influencer C and influencer D. Both of them have the same level of direct and indirect connects. However, some of the direct connects of influencer D are micro-influencers and hence the ability of influencer D to send out stronger signals is that much more compared to influencer C.
Now, this particular measure is measured as an analytical term called Eigenvector. You don’t need to worry about it. There are tools like node, excel, and unecet which you can use to identify the eigenvector score of various influencers, and obviously the one who has got a higher score has got a higher reach.
The second factor is relevance. By mining the type of content that the influencer has been posting one could understand his or her authority in the space that the company operates in, it will also be able to understand his or her interests and beliefs and if they are aligned with that of the company.
So for example, if the company operates in the value fashion space there is no point in having an influencer who is an authority in luxury fashion or for that matter if the influencer is very high on sustainability and the company does not have sufficient number of sustainability products then there’s no point in using the influencer. Again, there are tools like IBM Watson, Text Analytics and Semantria which can be used to mind content and understand the alignment and the authority of influencers and if they are in sync with that of the company.
The third one is resonance which is measured as the percentage of followers of a particular influencer who engage by way of likes, retweets, reposts, downloads, shares, etc. And in this particular slide, you would see that influencer D seems to have a higher level of resonance compared to others. But then again, as the reach or the network of a particular influencer increases his or her engagement or response rates tend to decrease.
So micro-influencers who typically have around 5000 to 7000 or followers typically see a higher level of response rates or engagement rates compared to mega-influencers who are possibly millions of followers.
So a company could decide possibly on a brand awareness metrics which is number of responses or engagement for every dollar spent on influencer marketing and then it can create its list of influencers based on a combination of their reach, relevance, and resonance.
So in summary for a great influencer marketing strategy firstly the company has to be clear on its business objectives. Is it brand awareness creation? Is it lead generation or sales? Number two it has to understand the social media consumption habits of its end consumers and which are the social media platforms where they have a higher share. And number three they need to pick the influencers who have the greatest reach and resonance on those platforms. I hope you found this video interesting. Please do follow us at insightsnow.Cloud. Thank you.