Many perspectives have been shared on influencer marketing, but very few from the brands themselves. What are its business imperatives and ROI?
In the heart of Sandton, Africa’s richest square mile, is Brittany Preece, a social media manager at Investec Bank.
As part of the Private Banking marketing team, Preece and her team have managed to successfully implement disruptive digital strategies to meet the growth objectives of the bank.
Traditionally, the role of marketing has been to support business objectives. Yet when companies experience financial difficulty, more often than not, marketing is seen to be the first in line on the chopping block. As a way of adapting to this reality, most marketing managers have had to look at cost-effective, yet creative, ways of achieving business impact.
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Social and digital media have given room for new ways businesses can engage and sell to their customers.
Increasingly gaining traction in South Africa is influencer marketing, an entirely new branch of the sales and marketing funnel which has seen brands leverage popular personalities on social media to promote their products and services online. Globally, the influencer marketing industry is forecast to be worth $5 billion to $10 billion by 2020, according to a study by Mediakix.
For Investec, attracting and diversifying into new markets has informed their decision to leverage influencers as part of their marketing strategy.
“Since 2015, we as Investec, have predominantly used influencer marketing to reach the young professional audience,” Preece says.
“We (Investec Private Bank) have recently evolved our qualifying criteria. We’re no longer just the preferred banking partner for accountants, engineers, lawyers, doctors and actuaries. We’re positioned to be the bank of choice for those who are under the age of 30, consistently earning more than R600,000 ($42,582)a year, with a university degree and working in their area of expertise.”
Seated in front of a glass wall which looks out to a view of a bustling and upbeat office environment, she elaborates that to effectively reach the young professionals’ target market, it is important to identify individuals that can speak to that audience.
“What influencer marketing gives you, that a lot of the other marketing channels can’t, is great reach and engagement with your target audience. Using [influencers] brings a lot of authenticity to the brand, where Investec Private Banking was seen as unattainable to a lot of young professionals,” Preece says.
In the digital universe, content is king. Authenticity is paramount. A study conducted by the Mobile Marketing Association reported that most consumers have banner blindness and suffer from advertising fatigue. They cannot recall the last digital banner ad that they saw.
Ad-blocking continues to be a growing phenomenon, further demonstrating the shift in consumer behavior. Consumers simply don’t want to be marketed to. To this effect, influencers assist brands to reach their customers through content that is more relevant to those consumers.
According to Business Insider’s 2018 Influencer Marketing Report: Research, Strategy & Platforms for Leveraging Social Media Influencers, the average social media engagement rate from influencer marketing averages 5.7% per post.
This is a feat compared to content generated by brands which fluctuates around 2% – 3% per post.
With this in mind, it’s even more essential for brands to involve influencers upfront to co-create an envisioned campaign.
“You want your influencer to buy into what you stand for as a brand. It shouldn’t be a hard sell – consumers see through that. If not done properly, it can look very fake and [we] never want to make it feel like an ad,” Preece says.
Brands and agencies measure awareness and engagement by analyzing a few parameters, including, inter alia, number of likes, comments, shares and followers. Proponents of this theory believe an increase in these parameters lead to brand success.
Detractors of the theory believe awareness and engagement alone are not sufficient indicators of brand success. “Likes and follows are unimpressive without an increase in the bottom line,” says Sinesipho Maninjwa, a financial analyst and commentator.
But technology has its limitations. Dianne Joseph, the Commercial Director of Digital at Nielsen, a leading global information, data and measurement company, elaborates that there are real challenges in measuring sales attribution as a result of influencer marketing.
“The influencer models are difficult to measure because most influencers use their own personal pages to post, and these organic posts don’t offer us the opportunity to implement a tag (for tracking purposes) and, therefore, we aren’t able to track the outcomes,” Joseph says.
The ability to measure what is happening on and off digital platforms, or across social media platforms, is a challenge that most digital marketers face. Different platforms such as Facebook and Twitter have their own unique methods of tracking and storing data. The link between these platforms is, therefore, a lot more tenuous.
But in support of influencer marketing, a number of global studies have come out and shown that influencer marketing does yield a positive return on investment (ROI).
Pierre Cassuto, of social media influencer platform Humanz, who recently set up shop in South Africa from Tel Aviv in Israel, believes that the use of influencers can lead to increased sales. “In the US market, there is about a four times ROI on money spent in the influencer marketing space for retailers, cosmetics and FMCG brands,” he adds.
Cassuto agrees that engagement on its own doesn’t yield conversion. For influencer marketing to yield conversion, the message being broadcast by influencers has to be well thought out and carefully constructed to achieve that objective.
There has to be a reason for someone to do something now as opposed to anytime. That can be around creating urgency around something specific, it can be around creating a limited time availability offer.
Essentially, brands can become creative and purposeful in how they design their entire campaign to track conversion from the ground up. “The way we suggest measuring conversion is by making sure that the influencers have a way that [brands] can track the relationship between the influencers post and the actual conversion,” Cassuto says.
The first looks at providing the influencer a coupon code that they can distribute and share. In doing so, the specific brands will know that the people who redeemed the coupon code came from the influencers. The second options measures sell over time related to increase in traffic due to influencer marketing towards a landing page that the brand is driving to. With this, Cassuto states that brands can do A/B testing to see the impact on days influencers are posting and days when they’re not.
With all the advantages of influencer marketing, should brands solely invest in this sales channel?
Preece firmly holds the view that influencer marketing on its own isn’t the be all and end all. “I do believe that it should be a mix. I believe that an integrated marketing plan that uses out-of-home, billboards, TV and digital is where you see the most results.”
“Things can go wrong with influencer marketing. You are putting faith and trust into a human being who is imperfect. We have a saying: A tweet can tank an economy,” Preece says.
With consumers becoming increasingly selective about what they consume, influencer marketing continues to grow as an attractive sales channel. It is imperative that brands place the necessary care and due diligence before partnering with any influencer.
The perfect fit between an influencer and the brand will determine the overall ROI. After all, effective influencer marketing is the online equivalent of the highly valuable word-of-mouth advertising that marketers have always coveted.
Surge Of Smartphone Apps Promise Coronavirus Tracking, But Raise Privacy Concerns
Topline: A pan-European team of researchers announced Wednesday their plan to release a smartphone app that would notify users if they’ve been exposed to someone infected with coronavirus, the latest example of tech-driven coronavirus solutions that have also raised concerns about user privacy.
- A European project called Pan-European Privacy Preserving Proximity Tracing is working toward releasing a coronavirus tracing app in the next week that would use anonymous Bluetooth technology to track when a smartphone comes in close range with another, so if a user were to test positive for coronavirus those at risk of infection could be notified.
- Contact tracing, or determining people who may have been exposed to someone with a virus, is an established aspect of pandemic control and was used effectively to tackle coronavirus in countries like China, Singapore and South Korea in the form of smartphone tracking.
- University of Oxford researchers and the U.K. government are working on a similar project— but unlike other smartphone tracking systems, the British version in development would be based on voluntary participation and bet on citizens inputting their information out of a sense of civic duty.
- The U.S. government is in talks with companies like Facebook FB and Google GOOGL and other tech companies about tracking if users are social distancing using large amounts of anonymous, aggregated location data— this information is less precise, and more likely to anticipate outbreaks rather than pinpoint individuals who have been exposed to the virus.
- 1.5 million Israelis have voluntarily downloaded a mobile app that alerts users if they’ve come into contact with someone with coronavirus— but Prime Minister Benjamin Netanyahu has still ordered that potential coronavirus carriers have their phones monitored, a controversial move the government says is necessary, as the 17% of the population using the app is not enough to fight off the pandemic.
- Moscow , on a city-wide lockdown since Monday, announced Wednesday that a new phone app that will officials to track the movements of people diagnosed with coronavirus in the capital city would be launched on Thursday, saying the government will lend a smartphone to anyone unable to download the app.
Crucial quote: “We’re exploring ways that aggregated anonymized location information could help in the fight against [coronavirus]. One example could be helping health authorities determine the impact of social distancing, similar to the way we show popular restaurant times and traffic patterns in Google Maps ,” Google spokesman Johnny Luu told the The Washington Post. He made sure to note it “would not involve sharing data about any individual’s location, movement, or contacts.”
Key background: Private and public entities alike are looking for ways to fight off coronavirus as the pandemic continues. On Wednesday, there were more than 900,000 confirmed cases worldwide and nearly 50,000 deaths.Officials told The New York Times NYT that The National Health Service, Britain’s centralized national health system, is trusted by citizens— and paired with the strong data privacy laws in place, said they think people would agree to join the effort to share their private information to help trace infections. However, American tech firms are reported to still be skeptical about sharing substantial data with the U.S. government ever since Edward Snowden revealed the NSA was collecting information from the firms clandestinely.
Surprising fact: The information tech companies have access to data that sheds light on Americans’ behavior in light of the coronavirus pandemic. According to a Facebook analysis, restaurant visits fell about 80% in Italy and 70% in Spain— while Americans only stopped eating out at a rate of 31%.
Apple Is Donating 9 Million Masks To Combat The Coronavirus
Topline: Apple will donate 9 million N95 protective masks to combat the coronavirus, Vice President Mike Pence said on Tuesday, making Apple one of several California tech companies pitching in as hospitals across the country report a shortage of protective gear.
- Pence thanked Apple for agreeing to donate 9 million N95 respirator masks to healthcare facilities across the country during a press briefing on Tuesday.
- Pence’s remarks come after Apple CEO Tim Cook tweeted over the weekend the company was “working to help source supplies for healthcare providers fighting COVID-19” and “donating millions of masks for health professionals in the US and Europe,” but did not offer more specifics.
- N95 respirators are masks that form a protective seal around a wearer’s mouth, filtering out at least 95% of particles in the air, according to the Centers for Disease Control, which makes them necessary to protect healthcare workers from being exposed to the disease from patients.
- Facebook has also said it is donating its stockpile of 720,000 masks purchased during the California wildfires last year, which degraded the air quality in the San Francisco Bay Area.
- Apple did not immediately respond to a request for comment from Forbes asking if all of the donated masks were stockpiled because of the wildfires or if the company got them from somewhere else.
Chief critic: Teddy Schleifer, a reporter at Recode, wrote that health systems shouldn’t rely on the generosity of big tech companies to make up for the failures of the federal government.
“But there is a risk in relying on corporate philanthropy—rather than the government—in solving this problem. For starters, it depends on the voluntary generosity of these companies to deal with an unprecedented emergency, an altruism that could vanish at any time,” he wrote.
Crucial quote: “And I spoke today, and the president spoke last week, with Tim Cook of Apple. And at this moment in time Apple went to their store houses and is donating 9 million N95 masks to healthcare facilities all across the country and to the national stockpile,” Pence said.
Key background: Apple is one of several California tech companies to give away N95 masks. In addition to Facebook, Salesforce, Tesla and IBM have also announced mask donations.
News peg: Doctors and nurses are sounding the alarm that they don’t have enough masks to protect healthcare workers. Not only does inadequate protective gear put important frontline health workers at risk, public health experts say, any situation endangering medical personnel may only further depletes the U.S. health system which already doesn’t have enough capacity to handle a surge in cases. State officials in New York and Illinois have criticized President Donald Trump for not stepping in to force companies to manufacture masks or allocate masks from private companies to ensure that states don’t outbid each other for the same supplies.
–Rachel Sandler, Forbes Staff, Breaking News
Video Games Are Being Played At Record Levels As The Coronavirus Keeps People Indoors
Topline: With school closures, mandatory work-from-home policies and lockdowns taking place in the U.S. as a result of the Covid-19 coronavirus pandemic, gaming has seen higher engagement, especially over this past weekend.
- Steam, the most popular digital PC gaming marketplace, reached new heights Sunday, drawing a record 20,313,451 concurrent users to the 16-year-old service, according to third-party database SteamDB.
- Counter-Strike: Global Offensive, released by Steam-owner Valve in 2012, seems to be the top beneficiary of the increased engagement, breaking it’s all-time peak on Sunday with 1,023,2290 concurrent players, topping its previous peak last month by a million, which itself beat the record set in April 2016.
- Like other esports, CS:GO has had to cancel events due to the virus, particularly the Intel Extreme Masters in Katowice earlier this month, though its peak viewership reached over a million, making it one of the most watched tournaments in the esports’ history.
- Activision Blizzard’s new free-to-play battle royale spinoff Call of Duty: Warzone, launched March 10 on PC, Xbox One and PlayStation 4, is also likely benefiting, drawing in a staggering 15 million in three days, besting the record 10 million in three days by last year’s battle royale sensation Apex Legends.
- These new heights follows similar effects of the virus on China and Italy: Telecom Italia’s CEO told Bloomberg it saw a 70% increase in traffic over its landline network, with Fortnite playing a significant part, while Chinese live-streaming service Douyu experienced increased viewership of the country’s most popular games, according to market analyst Niko Partners.
- While gaming was considered “recession proof” during the 2008 market crash, stocks aren’t immune to the current historic drops: software developers like Activision Blizzard are facing a 9% decrease in price year-to-date, while hardware companies that rely on Chinese manufacturing like Nintendo are seeing bigger drops of 24%.
What To Watch For: If these records keep rising as the closings and lockdowns continue. Arriving this week is Nintendo’s long-awaited Animal Crossing: New Horizons for the Switch console, a relaxing “life-simulator” that’s set to have a big day with many fans not-so-jokingly asking Nintendo to launch early.
Surprising Fact: Plague Inc., a game that tasks players in creating a virus that wipes out humanity, surged in popularity late January, becoming the top-paid game on the Chinese app store at one point, but the game has now been removed in China at the direction of the government.
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