How Virtual Influencers Can Mean Real Sales

Aug 06, 2023
How Virtual Influencers Can Mean Real Sales

Moving every few years as a child taught me to connect. Public relations and investor relations for Juwai IQI and consulting clients.

The billions-of-dollars influencer marketing industry is about to be shaken up. What it will look like in three years is anyone’s guess. That’s because new virtual influencers are proving to have many of the same advantages as human influencers—but none of the disadvantages.

What happens to influencer marketing is vitally important because the category will be worth $21.1 billion in 2023. That means it accounts for 6.4% of the total U.S. advertising market.

The best human influencers epitomize the potential of the category. They can even become fully fledged businesses themselves.

Jimmy Donaldson, aka MrBeast, is the most subscribed individual on YouTube and has parlayed that success into an estimated $110 million of total revenue in 2022. His ventures include a rapidly growing international virtual restaurant chain called MrBeast Burger, the Feastables chocolate and snack brand that is sold in Walmart and merchandise like $28 T-shirts.

Marketers are used to carefully controlling their brand messages, but when dealing with successful influencers like MrBeast, they have had to give up some of that control.

Powerful influencers can tell marketers what they’re willing and not willing to say and do to promote a brand. Because they control the audience, brand marketers just have to live with it.

But marketers are practical, and they keep going back. A 2019 study found that 92% of marketers believe influencer marketing is effective.

Just as we were all getting used to the rules of successful influencer marketing, something new is changing the game: Human-like characters can pose, sing and dance.

The pitch for virtual influencers is that they enable marketers to keep more control in their own hands while benefiting from all the value that influencers can create. Virtual influencers have no ego, can be more cost-efficient and will never get caught up in a scandal.

To be fair, virtual influencers have been around for years, but thanks to new technologies, lower costs and greater consumer acceptance, they are only now becoming fully mainstream.

Since she launched in 2016, sweet-faced but provocative Lil Miquela has amassed 2.8 million Instagram followers, major brand deals and estimated annual earnings of more than $11 million.

If you prefer a less wholesome aesthetic, the virtual influencer known as Guggimon is a “horror bunny.” Guggimon has appeared in Fortnite as a skin, partnered with Gucci and Paris Hilton, and sold out multiple NFT drops. Guggimon’s Amazon show is in development and the design studio that created him, Superplastic, has raised $58 million in funding.

There are also less expensive virtual influencers out there. Baidu charges businesses only up to about $14,300 per year for virtual people projects. Their production costs have fallen by 80%, and Baidu expects the business to grow by 50% annually.

Virtual influencers are becoming so powerful that human stars want to win their blessings. Rapper Timbaland said he would like to have Lil Miquela appear in his next music video. Today, fake people can have more brand equity than real ones.

Brands don’t have to rely on independent virtual influencers. They can create their own.

This is what Prada did with Candy, the virtual face of its youth-oriented perfume of the same name. Creating Candy was “probably the closest I’ll ever get to giving birth,” Candy’s creator, Danish director Nicolas Winding Refn, said.

Using a virtual person instead of the human influencer gives Prada absolute freedom to determine her values, personality and appearance. Prada hopes Candy will communicate fearlessness, curiosity, charisma and beauty.

How To Succeed With Virtual Influencers

New brands are as good at building relationships with their customers as influencers are. When working with human influencers, brands have to give up some control. And that’s usually a good thing because product managers would otherwise be likely to stifle the creativity and authenticity that gives influencers their persuasiveness.

When brands create their own virtual influencers, they may misuse their control and defeat their own goals. So far, Prada has been discrete with Candy, but not every brand will be so successful.

Brands that want to experiment with virtual influencers must pay even more attention to execution. Focus not just on pixels but on good storytelling. Ensure your target audience will find the influencer relatable and align your content to the influencer’s personality and values rather than the other way around.

A virtual influencer campaign can be more cost-effective, but don’t do it on the cheap. Because virtual influencers do not age, you may continue to work with them for years, even decades. Invest as much as necessary upfront to create a successful personality.

Source: forbes