Influencer marketing has exploded in the past few years, with a Business Insider report estimating $15 billion in influencer marketing spend by 2020. There’s a reason why influencer spending has skyrocketed—it can generate 11x as much ROI as banner ads. A lot has been written about the space, mostly from people trying to generate clickbait and rack up some views.
Unfortunately, this means that there’s not much informative material out there about one of the fastest growing marketing channels. That’s why we’ve worked hard to assemble the ultimate guide to influencer marketing that will tell you everything you need to know.
Who Is An Influencer?
Let’s start with the basics—what and who qualify as influencers, and what are the different types of influencers?
Influencers are social media users with an established audience who post branded content about specific products. Influencers have built their audience by becoming a recognized authority in a specific niche, like makeup, food and beverages, or travel.
By recognized authority, we don’t mean that influencers have a PhD in what they’re posting about. Rather, we mean that their passion, commitment to producing high-quality content, and attentiveness to the audience have made them a resource people trust and rely on for inspiration and information.
It’s a common misconception that an influencer needs to have a massive audience of millions; however, nothing could be further from the truth. Influencers are a diverse group of individuals who come with all sizes of followings, and massive accounts with millions of followers form only a tiny part of the ecosystem.
There are three broad categories of influencers:
- Nano/Micro Influencers: As the name implies, these accounts have a relatively small following, starting at a couple thousand. Despite their small size, they are increasingly popular to work with because of their authenticity and the intimate relationship with the audience that their size makes it possible to have. For instance, you probably already follow a niche account that has a few thousand followers.
- Power Middle: These mid-sized accounts span from the tens of thousands to the low hundreds of thousands. They’re the most popular accounts to work with because they have a larger reach, but still retain authenticity.
- Celebrity Influencers: These accounts reach into the millions of followers, and are the ones most people think about when it comes to influencer marketing. For certain use cases, their massive reach and ability to generate viral content can be incredibly helpful. However, they’re also the most expensive to work with, and somes accounts can come across as highly commercialized, minimizing the authenticity and genuine interactions that are so important to successful influencer marketing.
Regardless of the category, all influencers share a common foundation: high-quality content and an engaged, interested audience.
Building upon that foundation, successful partnerships between brands and influencers are based on ensuring that both parties share a similar vision/aesthetic and fostering a long-term relationship. One-off posts that do not align seem fake and transactional and will only hurt your brand—for example, a vegan food blogger posting about leather goods would be counterproductive at best.
The Influencer Industry
Influencer marketing is a relatively new branch of social media marketing, but it is growing by leaps and bounds. The industry has tripled in three years, jumping from $1.7B in 2016 to $6.5B in 2019. Similarly, Google searches for the phrase “influencer marketing” have skyrocketed 1500% in the same three years.
The industry is only expected to grow further as more brands discover the value that can be generated via this channel. Last year, 63% of brands planned to increase their influencer marketing budget in the coming years.
Why all this growth? Because influencer marketing works. People follow influencers because they trust their opinions and want to emulate their lifestyle. So when they recommended products or services, people listen.
As has been mentioned, authenticity and trust is one of the main values of influencer marketing, and there is tremendous value in this. Indeed, trust is as important as price to consumers when making purchasing decisions.
Influencers play an essential role in bridging the gap between consumers and brands, and can be considered the best of both worlds. They are approachable and have a close relationship with their audience, which builds trust. At the same time, they are respected in their niche and embody an aspirational lifestyle that makes followers more likely to pay attention and act upon their recommendations.
How to Find influencers
So, how do you find influencers to partner with? There are quite a few options.
This is the simplest and most direct way to begin working with influencers. You can find specific accounts by searching for specific hashtags, keywords, or even just going through the followers of popular accounts that align with your brand. The more specific the hashtag or account you’re searching through, the higher the chances of finding an account that aligns well with your brand.
Once you’ve found your dream account, you need to get their attention. You can achieve this by shooting them a DM and leaving comments on their posts briefly introducing yourself and explaining that you would like to work with them.
We recommend reaching out from your mobile phone—influencers will almost always have their account set up as a business or creator page, meaning that their email will be easily accessible if you’re viewing the profile from mobile. Needless to say, also reaching out via email improves your chances of getting a response.
While this approach is simple and direct, it can also become very time-intensive and have poor returns. It can take a lot of time to sift through the millions of accounts on Instagram to find the ones that align, and once you reach out there is no guarantee that they will respond. This is especially true if they’re not following your account—your DM will not go straight to their inbox but rather a “request” folder, where it may languish for days or weeks.
A more sophisticated approach is using an influencer database. This allows you to cut through the noise by using filters to quickly find a batch of accounts that meet your criteria, like location, age, or gender (many databases also have more narrow filters than these). Some databases also come with an analytics tool that allows you to quickly see an influencer’s stats, such as amount of followers or their engagement.
While this allows you to find potential partners in less time, you still have to reach out to them, and there’s still no guarantee they will respond.
It’s also worth noting that the quality of databases can vary greatly, since many of them have simply scrapped the data from Instagram, meaning there’s no curation or quality control. For instance, it’s not uncommon in a database to be searching for a certain type of influencer, like “foodie,” and end up with hundreds of less-than-useful results like Olive Garden.
This approach inverts the search process by having influencers come to you!
In an ambassador program, influencers receive free products and exclusive deals in exchange for recurring posts over a period of time.
An affiliate program is more formalized, and allows influencers to earn a commission on sales they drive for your brand through posts and stories. This is commonly measured by providing each of your influencer affiliates with a unique referral code and tracking how often it’s activated.
Needless to say, the more attractive you make your program, the more interest it will receive. Higher commissions will result in more applications. Over time, word will spread, and you’ll start to receive inquiries from influencers who are hoping to partner with you.
Perhaps the best overall solution to finding influencers is a curated network. Influencer networks act as a marketplace where brands are able to set up a campaign and influencers apply to join, which saves time and effort for all parties.
Networks are closed, meaning that not just any brand and not just any influencer can join. Instead, influencers must request / receive an invitation to join, which is provided only once an account has been vetted to ensure it has real followers and consistently produces high-quality content.
Due to their exclusivity and careful management, networks are able to provide several additional benefits to brands:
- There is no price negotiation with the influencers. Rather, rates are set at the very beginning, and influencers who apply are agreeing to that rate. This dramatically speeds up campaign turnaround while also keeping costs down.
- You’re protected and have a right to use the content created. Many brands repurpose content without first contacting the influencer and obtaining consent. This violates Instagram’s ToS, and the influencer has the right to sue. With a closed network, influencers explicitly consent to let their content be used, and it’s all legally binding in the ToS. Even better, most networks allow you to directly download the content as opposed to having to reach out to influencers and asking them to email a JPEG.
- They also function as a mini social- network / CRM tool. This makes managing your influencer campaigns a breeze. No need to manually keep track of everything on spreadsheets or waste time tracking down their shipping information—it’s all stored on the platform.
- If you encounter a problem, you’re not alone. There’s a dedicated account manager to work with you every step of the way and ensure that your campaigns are a success. Influencer networks are there to support and help you.
How Much Do Influencers Cost?
So, how much does this all cost? Well, it depends—different influencer marketing solutions have different price points.
At the lower end, you can receive basic access to a bare bones database for as little at $99 a month. However, they’ll then start to nickel and dime you, which can quickly raise costs even more. Many times you’ll need to pay to unlock a certain amount of influencers, or to add an additional user to your company’s plan. And of course, you will also need to set aside budget for each influencer you want to work with.
As the industry becomes more established, even micro-influencers have begun to charge around $500 a post. Working at scale can become very expensive, very quickly.
On the opposite end, premium managed services charge a minimum of $25,000 per quarter. This can seem expensive, but it’s a premium service where everything is taken care of for you. When you factor in the costs of searching for influencers, communicating with them, coordinating logistics, ensuring they post, paying them, and figuring out how to repurpose the content, it can be worth going this route if your budget allows.
Of course, there are also several middle-of-the-road options that allow you to work with a certain number of influencers for a flat fee per month.
At the very least, if a brand wants to do influencer marketing right (i.e, the only way to do it), they should be setting aside around $5,000 per month to cover all the components of running a campaign.
Best Practices For Influencer Marketing
Set Up Clear Guidelines
The first and most important thing to do when running an influencer campaign is to establish clear, concise guidelines. To ensure a successful campaign, it’s important that everyone is on the same page.
This means communicating what you’re looking for from the very beginning and not changing it once the campaign is underway. Before entering a partnership with an influencer, make sure you have clearly explained the campaign to them. This includes the big picture (campaign goals, the type of images you’re looking for, the product they will be receiving) and the details (required hashtags, key points to mention in their caption, ensuring that they receive their affiliate link).
Work At Scale
Instagram has over a billion users. To achieve meaningful results, your influencer marketing campaign should be activating dozens of influencers at a time. Running sporadic, one-off campaigns with just a handful or influencers will lead to a disjointed, small-scale campaign that never achieves liftoff and is never able to start generating results.
Basically, if you’re going to commit to influencer marketing, go big or go home.
More specifically, depending on your specific goals and products, your pool of influencers should maximize breadth or depth.
- Breadth: If your product has mass-appeal, you should be working with dozens of influencers across age/gender/racial demographics to maximize exposure and sales.
- Depth: If your product has a specific niche, work with dozens of influencers who focus on that niche to ensure that you’re reaching the right people.
Create A Compelling CTA
As with all marketing, influencer posts should have a compelling call to action (CTA) to drive results. Common CTAs include taking advantage of time-sensitive promotions, swipe ups on stories to learn more/shop now, enter now to be part of our giveaway contest, etc.
Compensate Influencers Fairly
Some brands try to rely on product exchange for all their influencer marketing, but this is rarely successful in the long term. For this reason, it is important to fairly compensate influencers.
Influencers are providing a service to your brand by promoting your product, as well as putting in the time and effort to craft high-quality content for you. To ensure best results, compensate influencers in a timely manner after they have posted to their feed.
These days, most influencers will not enter into a partnership without monetary compensation. They will likely have a media kit that specifies their rates and services, but these rates are not set in stone. There is usually a negotiation process, and many times influencers are willing to lower rates for products or brands that they truly would like to work with.
Additionally, feel free to shop around—the industry is still new and settling on standards, meaning that it’s common for influencers with the same following to charge different rates.
Ensure Partnerships Are Transparent
As a paid, sponsored post, influencers should include #ad, #paidpartnership, #paidcollaboration or a similar hashtag that clearly indicates the post was coordinated with a brand. This is an FTC requirement, and while it’s ultimately up to the influencer to use the hashtag, brands should do their part by emphasizing transparency and reminding influencers to disclose the partnerships.
It may seem strange, but using a hashtag like #ad does not harm an influencer’s authenticity—rather, the audience knows they are working with brands and appreciate the transparency.
Additionally, one of the reasons influences have a large following in the first place is because their audience wants to emulate their lifestyle, including learning about and buying the products they’re using. For example, makeup influencers have the following they do because the audience trusts them to do the research and recommend the perfect line of makeup for a certain look.
In other words, influencers’ audiences know they’ll see sponsored posts and actually want to see them. If the influencer they follow is passionate enough about a product to do a sponsored post for it, followers will want to check it out.
On a practical level, running an influencer marketing campaign provides brands with 4 main benefits: Content, awareness, traffic, and sales.
Simply put, it takes a tremendous amount of time, money, and effort to generate quality content at scale. Despite these challenges, brands that want to stay ahead of the curve can’t slack off.
Content is the lifeblood of social media and the key to creating—and maintaining—an engaged audience. If you’re not posting, people aren’t listening.
Influencer marketing allows you to essentially outsource this, but at a fraction of the cost of hiring an agency. Instead, you’ll have dozens of talented influencers creating high-quality user-generated content (UGC) that you can repurpose. Not only is it more cost-effective, but by working with dozens of accounts, you obtain a diverse, varied stack of creative as they all incorporate their unique aesthetic into the content.
And it gets even better! Not all content is created equally. For instance, UGC is much more valuable than stock photos or in-house content because it is widely considered to be more honest and authentic. 86% of millennials say that UGC is a good indicator of the quality of a brand, and 93% of consumers find UGC to be helpful when making a purchasing decision.
Think about all the times you’ve been searching for a restaurant to go to. Sure, you check out the restaurant’s website, but you also browse and place more emphasis on the tagged pictures and reviews to see what real people’s experiences were like.
On the opposite end of the spectrum, brands like Fashion Nova have heavily leveraged influencer marketing on Instagram to reach half a billion dollars in yearly revenue.
What do we mean by heavily leveraged? Successful brands like Fashion Nova are posting up to 30 times a day, 7 days a week. That’s about 10,000 pieces of content needed in a year. It would be insanely expensive and time consuming to coordinate that, whether you have an agency do it or coordinate it all in-house. With influencer marketing, they’re able to quickly and efficiently meet their content creation needs.
As influencers generate content for your brand, they’re also posting it to their feed, which results in another key benefit: awareness.
These days, everyone goes online to do research on a product before deciding to purchase. One place they go to do research is social media. More specifically, 60% of Instagram users seek out and discover new products on Instagram, and 62 % say they have become more interested in a brand after seeing it on Instagram.
Regardless of the industry, new brands that have managed to make it big—be it Casper, Dollar Shave Club, Glossier, etc.—have all heavily relied on nurturing brand awareness through an active, dynamic presence on social media, accomplished largely via influencer marketing.
Content and awareness are the foundation to successful influencer marketing. Once you have that in place, you can start channeling influencer marketing into actionable items, like driving traffic to your site and growing your audience.
Getting people to visit your website allows you to enter them into your sales funnel. You can get them to sign up for your newsletter, offer a discount on first time orders, and much more.
There are many tactics that can be implemented to accomplish this goal. Influencers that you work with can create a swipe up via Instagram’s Stories feature that lead to your website or a unique landing page. Introducing a sense of urgency via time-sensitive offers (“first 20 to sign up will get a free copy”) furthers adds to these efforts.
Giveaways and other types of content are also very effective in sending people your way, as people participate in a chance to win free product from you. To do so, they usually need to follow your Instagram account and tag their friends in a caption, which has a compounding effect as more and more people enter.
This is perhaps the most common reason brands utilize influencer marketing. That said, successfully generating sales via influencer marketing is a gradual process in which the other three elements mentioned need to be in place. Once everything is in place, though, the benefits can be huge—you’ve opened an entirely new sales channel!
Even more encouraging, Instagram (and social media in general) continues to make a push into becoming a shoppable experience where you can easily browse, review, and buy products without even leaving the app.
Already, 140 million people a month tap on shoppable posts. These posts have increased traffic to websites by up to 44 percent and revenue by 8 percent. Like we said, influencer marketing works. And like we said, sales on Instagram are expected to increase even more as the platform optimizes the shopping experience. For instance, faster checkout equals more transactions.
Average ROI Of Influencer Campaigns
There are several ways to determine the return on investment generated by influencer marketing, and it partially depends on a brand’s individual goals. These are some of the most common ways.
Influencer marketing generates a fresh stack of creative that you can repurpose for socials, website, newsletter, ads, and more. This frees up time for any in-house creative to focus on more long-term, strategic projects without sacrificing daily activity. It also eliminates the need for expensive, time-consuming product shoots or long-term contracts with agencies, resulting in more money and flexibility.
To run successful ads, you need compelling visuals that resonate. As we’ve mentioned, UGC sourced via influencer marketing will achieve this. The content is more compelling and relatable, which translates to more clicks, conversions, and sales on your ads. It’s not uncommon to see a 4x improvement in ads when in-house content is replaced with UGC.
Most importantly, influencer marketing builds brand awareness and drives people to your website. This allows you to capture new leads at scale, enter them in your funnel (drip campaigns, cookies, etc.) and convert them to customers. Knowing your customers’ lifetime value is key.
Of course, you’ve heard about these metrics before. Another crucial ROI of successful influencer marketing is clarity.
Many brands have started out with influencer marketing using spreadsheets and an army of people sending DMs. This process is clunky and opaque, which robs you of the ability to gather actionable insights and optimize your influencer marketing strategy.
Over time, as brands switch to more sophisticated tools, they are able to predict timelines and results. Once an influencer campaign is established and is being properly managed (via software and platforms, not spreadsheets and databases) brands can begin to make accurate predictions. For instance, a brand can review the data and reports and know that they can expect an average of 20 pieces of content to go live each month, and that on average using that content in ads will lead to a 10 percent increase in clicks.
Having this clarity and ability to make accurate projections is invaluable, and leads to an overall more efficient and profitable business.
On the contrary, if you’re just winging your influencer marketing strategy and lurching from situation to situation, you will never be able to develop a foolproof system, robbing you of the ability to project timelines, budget, and results. In other words, you’re losing time, money, and energy.
Influencer marketing isn’t the future—it’s the present. Entirely new brands have risen to the top of their industry by perfecting this strategy, and legacy brands that don’t incorporate influencer marketing risk falling behind and becoming irrelevant.
The good news is that there are several different services and platforms to help you quickly and efficiently leverage influencer marketing for your brand.
Manual outreach and databases are a solid start, but if you’re serious and plan on working at scale, you should seriously consider full-service, high-touch options. Over time, going this route will save you vast amounts of time, money, and effort, and is absolutely worth it.
A solid starting point would be Trend, which is an invite-only network of influencers where brands can sign up and add their campaign to the marketplace. This offers several key benefits:
- Influencers are screened to ensure authentic audiences and high-quality content, which gives you peace of mind and saves you the time it would take to go vet this all yourself.
- Once a campaign is created, influencers apply within minutes. Trend has done most of the vetting for you, so all you really have to do is select the influencers that you want.
- Oh, and did we mention that there’s no price negotiation? That’s right—all you have to do is pick your influencers and send them products. Super quick, super simple, super great.
- Every brand is also assigned a dedicated account manager who goes through a detailed onboarding process with you and provides direct support at any point in the campaign.
- Finally, Trend also provides you with rights to the content generated. You can download directly from the platform and layer the creative into ads, paid social, websites, and more—all while being compliant with everyone’s ToS.
Need a little extra help? Another great option is Studio, Volusion’s in-house marketing agency specializing in digital marketing and design services for ecommerce merchants. Their social media marketing specialists have created successful influencer marketing campaigns for many of their clients and can be a great asset if your team does not have the time to manage influencers on their own.