What is Influencer marketing?
Influencer marketing is a new form of marketing that literally means working with “influential people”, or influencers. This form uses both innovative and traditional well-proven communication tools for effectively bringing key messages to the target audience. The main idea lies in collaboration between opinion leaders and brands. Usually, those collaborations are online.
The main goals for such campaigns are raising brand awareness and sales. At this moment, influencer marketing is a fast-growing field with year-on-year capitalisation growth. In 2019, according to Marketing Hub, the influencer market volume reached around $6.5 billion (+40% / 2018). In 2022, according to eMarketer, more than 70% of companies already used this tool in their brand promotion strategies.
What makes an influencer?
Oxford dictionary defines an influencer as “a person or thing that influences somebody/something, especially a person with the ability to influence potential buyers of a product or service by recommending it on social media”.
In influencer marketing, we define an influencer as a person (or rather a character because often there is a team of marketing and PR specialists behind an influencer) that is able to influence sales patterns and volume for a specific product thanks to the knowledge, experience, and to being an opinion leader. Influencers usually take a specific niche, in which they actively interact with followers. The influencer’s audience size depends most commonly on the market niche size.
Which type of clients needs influencers most?
All companies need influencer marketing! This might sound pretentious but it is true. To begin with, influencer marketing should become an integral part of any PR strategy. First of all, you need to keep in touch with your target audience. This goal can be professionally reached by opinion leaders. Secondly, you need to sell. In the selling process, you might use various supporting instruments that help to attract customers. For example, it could be referral programs that are advantageous to both clients and influencers of your choice. A referral program is quite a popular promotion method that assumes that the project’s partners get certain benefits, like discounts or sale fees, for their assistance in sales or attracting new clients. New clients often come with special referral links or promo codes.
Let’s dive into the case of collaboration between an international retailer METRO and game bloggers at the streaming platform Twitch. Total campaign coverage reached 4.3 million unique viewers. Over 800 promo codes for METRO delivery services were activated during Twitch live stream. Over 20% of buyers that used the promo code ordered the delivery again. This is a great example of how collaborations with bloggers can lead to sales growth and raise brand awareness in the market.
That is why it is not important whether you launch a startup or lead a major company with a great budget. Any company needs to assert itself, retain the media presence, interact with the target audience and grow sales.
Influencer marketing and media publications: how to mix?
Nowadays, any PR campaign combines traditional and new promotion tools by focusing both on media publications and collaborations with bloggers. A classic promotion campaign splits budgets 50/50 between media publications and opinion leaders. But this model is not always optimal for success. For example, the target audience for NFT and GameFi projects is mostly reachable on social networks. This can hardly surprise anyone because bloggers launch their gaming streams, hold AMA sessions with projects’ founders and run contests to attract the audience.
Symdroid, a Twitter blogger and the head of the CryptoZillaVC marketing agency, shared:
“Twitter is the best platform for the crypto audience. That is why we close here the best campaigns and get a very good conversion for NFT and crypto projects.”
For projects in those fields, promotion in social media and collaborations with opinion leaders are the most effective tools as one needs results “here and now”. During the NFT collection launches, the main focus is usually made on Twitter where many contest mechanics have proven their effectiveness. Media shares no such functionality but it is also a good instrument when the unique selling proposition of the project has to reach a wide audience.
Why is direct pitching to the blogger offering working for free or allocations a bad idea?
Many projects try to minimise advertising budgets this way. This approach to promoting a brand in the market has gotten the name ‘bootstrapping’. The Internet is full of stories about advantages and successful examples of bootstrapping campaigns. One of the most widely quoted cases is the campaign for the producer of mobile cameras GoPro. But the CEO of the company Nick Woodman shared that bootstrapping strongly holds the company’s growth and is applicable in cases when there are no resources for promotion budget at all:
“People think that GoPro is an overnight success, but really it’s been a ten-year slog to get to this point and while at the time maybe I wished that I’d had more money than I did, I see it as really advantageous now because we took a long time to learn our markets and learn our customers.”
In the crypto market when the situation is changing month by month, and new projects have a little less than a decade to make a name, the cost-cutting strategy does not work in the best-case scenario, and leads to negative consequences in the worst-case scenarios. Most commonly, inexperienced teams share one of two mistakes:
- Try to reach bloggers directly;
- Offer barter trade deals (allocations).
Both simply do not work in the crypto field.
During the first contact with a blogger, it is important to understand that he or she has already formed the terms for a potential collaboration, and most commonly, those terms are more favourable to the PR agencies. The PR agent first of all takes responsibility for the management of campaigns with opinion leaders starting from negotiating the best terms. That is why direct contacts in an attempt to cut costs most commonly lead to bloated budgets.
The barter collaboration system, or compensating bloggers with allocations, does not work for three main reasons:
- Barter or allocation can be seen as non-equivalent to the blogger’s efforts. It might be seen as a format of unfair trade when a blogger shares a resource with a project but gets in return a dubious offer to participate in a private sale. Also, most commonly, bloggers take on a neutral position: they will not invest in the project if it is not explicitly stated in the contract!
- Bloggers might think that a project tries to cheat, especially when an unknown project reaches directly. No influencers will agree to dubious prospects somewhere in the future. That is why bloggers always take 100% prepayment for their services.
- Bloggers value their reputation and audience. That is why they trust PR agencies with a successful track record more, especially if they already worked with an agent. New projects will most probably be left unanswered unless their offer comes from a well/known source like an agency.
Some bloggers agree to allocation deals but only when the project has already brought multiple digit profits, has good publication in reputable media sources and has a well-formed community around the project.
Symbroid shares that he would agree to work for allocation only if he is personally “interested in the project” while the collaboration itself is “a long-term play when both the project and the team benefit from this partnership”.
This is why the old saying “miser pays twice” can be applicable here and some attempts to cut budgets lead to its losses. The PR agency guarantees the reliability and quality of the service provided by a blogger. The influencer marketing department seeks bloggers and maintains the blogger database, negotiates terms with special discounts for agencies. Marketing specialists lead the materials preparations and support the ad placement process at each and every step. A good influencer marketing specialist is always in touch with the client, promptly reacts to the requests, and in case one of the bloggers cancels the collaboration, takes on a responsibility to offer a replacement of equal value. Those are the benefits of working with a PR agency.
Are promotion campaigns relevant in the bear market?
When a crisis strikes, many companies reduce advertising costs. However, those companies win that not only keep the budget but also increase it. During a period of complete calm, an excellent opportunity is formed to revise the brand positioning strategy, highlight weaknesses and strengths, and identify a new vector of development. At this time, you have no sales and no customers, but this does not mean that the audience is not following you. All crises have an end when people start to buy again. But who will they buy from? For sure, from a company that was around all the time.
During the crisis period, projects face a fall in audience engagement in social media. It is an absolutely normal reaction because the products might become the least of the followers' priorities. DMT, a popular Twitter blogger and the owner of the marketing agency Cryplistic shares the following opinion:
“In the bear market, everything is different. People are not interested in new projects that are being built for the future. This influences the audience attraction metrics. So yes, the engagement with my audience has changed a lot since the bear period came.”
At the same time, the fall in audience engagement is not enough a reason to halt a PR campaign:
“As an influencer, I believe in the power of the right marketing in any case. Marketing works in the bear market too if the project has something to offer or the project would like to draw attention to upcoming events. So, if you take your project seriously and build it despite the market’s ups and down, your efforts deserve to be seen by the audience.”
The period of the Great Depression is a new opportunity when the advertising budget is not a cost but an investment. Remember that any person is your potential client.