Innovating Influencer Marketing to Drive Growth

Sep 14, 2023
Innovating Influencer Marketing to Drive Growth

Today, the average time spent on social platforms has increased to more than 2.5 hours per day, according to market research firm GWI, while social media holds an ever-greater share of total time spent online, accounting for 38 percent globally.

With that consumer time and attention spent online comes significant opportunity for both brands and retailers. Sixteen to 34-year-olds are currently more likely to discover new products and services via social media ads than they are to learn about them through search engines.

As a result, the scale and quality of content output needed to cut through the noise, court consumers and facilitate a frictionless path-to-purchase, has grown exponentially. Often, brands and retailers must look outside their organisations for influential collaborators for support in creative content development and proper measurement of results.

Influencers have long been a critical partner for many fashion, beauty and lifestyle advertisers, with the influencer marketing industry set to grow to more than $21.1 billion in 2023, according to The State of Influencer Marketing 2023: Benchmark Report. In part, this is because customer acquisition costs are increasing. In 2022, brands spent more than three times the amount to acquire each customer than they did ten years prior, as reported in BoF and McKinsey’s State of Fashion 2023.

To justify that spend today, brands and businesses must be laser focused on the path to purchase, collaborating with the right talent and leaning into the aesthetics and audience dynamics of different channels to truly build winning social commerce strategies.

Since its inception in 2015, MagicLinks has worked to power social commerce — benefitting both brand and talent — through a marketplace for video influencers and businesses. Connecting more than 35,000 influencers — with a reach of over 3.1 billion annually — to more than 5,000 leading brands, MagicLinks helps to formalise collaboration, providing brands with data-backed campaign solutions, creator investment data and, critically, a return on advertising spend. To date, it has generated an estimated $5.45 billion in sales for its partners, with a reach of more than 56 billion unique viewers.

Now, BoF sits down with Jennifer Piña, MagicLinks’ vice president of strategic partnerships, to discuss how the influencer marketing space is evolving, the core competencies of a successful strategy, and why new channels and dynamics make investment in this space so timely.

How has the influencer industry, and its impact on brand marketing, evolved in recent years?

The creators themselves have long dictated where brands spend their money. Back in 2015, when Youtube and Instagram were the dominating platforms, we saw the rise of multi-channel networks. Groups of influencers were the first to power pricing methodology in the space. While brands knew they had to start investing in influencers, there was no guidance around measurement outside of social metrics which, in turn, created a lot of confusion.

By 2018, internal teams had evolved to reflect the importance of influencers, with roles specifically carved out to manage brand and creator relationships. Not only did this put pressure on teams to take tangible results back to their chief marketing officers, it also increased demand for technology to help quantify this investment and connect press and publicity to conversion rates.

Post-Covid, brands are investing heavily into the partnerships and technologies that help them measure their efforts in the influencer economy. It’s critical today for brands to understand — if they are investing 25 percent of their marketing spend into influencers — how that helps to drive their business. They should know how specific campaigns are tracking and what new metrics they should consider.

What are the key success metrics brands should measure for influencer marketing?

Today, brands must consider full funnel impact, from onboarding and activating influencers to creating a campaign around them, to everything from impressions to engagement, [dwell] time and conversion rates. Different talents are often suited for different parts of the client journey. Someone like Bretman Rock can inspire an entirely new audience for a brand; creating conversations with far reaching impact – he might sell out a collection, but it doesn’t necessarily stop there. He’s influencing influencers, changing the face and perception of the brand. So the ROI view should account for the full picture, and with a longer runway. On the other hand, a first-time paid activation with a micro or mid-sized creator should be more closely aligned with immediate impact, and with proper tracking for revenue, new customers etc.

Brands should be laser focused on how they can make their spend more efficient and travel further. For example, leaning into influencers to build an ongoing stream of content for owned channels and paid media, negating the need for big agencies to create more content.

Middle funnel metrics — how the brand community is engaging, what is the audience sentiment after a post or a video goes live — are also important measurements. And then, the sales metrics are also key. Often, this is the most challenging due to the rapid proliferation of channels. From in-store purchases to big box retail and direct-to-consumer channels, there are so many paths to purchase through influencer marketing. How the brand tracks these different journeys is a key focus for us at MagicLinks. Even the lifetime value of that acquired customer is considered — we are working to measure and quantify all of these different facets on behalf of the brand.

How can brands and retailers gauge which talent is best placed to carry their social commerce strategies forward?

Often, sponsorships become big, convoluted spheres and can muddle decision-making for influencers because, of course, every creator wants to make money. The key for brands is to establish real relationships with creators — or partner with a network that has a deep connection to, and understanding of, influencers themselves.

Brands should be laser focused on how they can make their spend more efficient and travel further.

Brands often need guidance. When we are activating a brand, we’ll start with a larger pool of maybe 60 creators, advised by our sales data, to ultimately land at 20 upon closer examination of fit for the campaign. For instance, a clean skincare brand that operates with a certain level of care and with a certain level of care and ethical consideration will require a thoughtful approach.

Important factors for selecting a creator to partner with includes an assessment of values, past collaborators, whether the influencer drives accessible or luxury tier engagement, the type of products they share, and how their audience takes action. It should all be informed by data points that span how the influencer operates and what their community is gravitating towards. The goal is to bring a brand and a potential brand partner to a natural meeting point. This is also the beauty of offering rewards based on performance.

What role could micro-influencers play in the future of influencer marketing?

The micro-influencer space is the fastest-growing and can carry the most impact for brands. They are an incredibly attractive group as they tend to drive the highest conversion rates, at higher price points. They also cost less, so drive greater ROI. The tricky part is how to reach scale with micro influencers. Strong creator networks are important as they can provide a brand access to a group that’s already been vetted, making it easier than a brand sifting through thousands of creators and dealing with that level of outreach by itself.

Of course, it’s all deeply connected to the type of brand you are, the spaces that you show up in and the ways in which you make yourself both visible and available to your potential customers. As long as the correct measurement vehicles are in place when brands are implementing a content strategy and paying an influencer, nano and micro-influencers have the potential to drive considerable impact in near-term iterations of influencer marketing. Media value can come from these communities — but knowing what metrics to place against them is key.

How has influencer content strategy evolved to create more impact?

A focus on the associated experience of a brand or product is re-emerging as an effective strategy for brands — we are seeing a resurgence of organic integration of products into influencer marketing. TikTok creators have led the charge here, where heavily branded or sponsored content is not overtly successful.

If a brand finds it difficult to relinquish control or trust influencers to create content on their behalf, I would encourage them to simply lean into what the data tells us.

Instead, some influencers might share what they are inspired by in conversation, linking it in their bio or perhaps mentioning a product or brand in the comments without a call to action. It encourages the audience to research the brand and discover the products themselves. It’s almost an underground invitation from the influencer to discover more about their world and for the audience to work a little harder to find things. I think it holds a lot of promise for product discoverability — even if it does open a can of worms when it comes to measurement.

Should brands be experimenting with new platforms such as Meta’s Threads, ByteDance’s Lemon8, or Twitter’s evolution into ‘X’?

There’s always going to be brands that want to be seen taking the first step across the new platforms and mechanisms that pop up. While it’s great to see the experimentation, it all goes back to investing in the right creators and truly building and knowing your audience.

What works and resonates with your community may not feel right within a specific platform or format. Instead, brands should be trusting the influencer who knows their audience, knows where they’re spending time, and trusting them to do the very best work regardless of the platform. It’s important to be cognisant of new platforms — but as we’ve seen previously, many simply don’t stick. Prioritise connecting with your community.

How can brands and retailers confidently give creators the freedom for authentic content creation?

If a brand finds it difficult to relinquish control or trust influencers to create content on their behalf, I would encourage them to simply lean into what the data tells us. The more that brands have impactful measurement vehicles in place, the easier it will be to relinquish control.

Working within a brand, you will naturally have a narrower lens on what works for you. The key is to lean into the data available across the entire space, and set aside budget to test collaborations with creators where the data indicates a powerful partnership. Often, this can mean experimenting with creators who may not fit a brand’s typical brief but have a clear track record of driving success among similar brands with audiences the brand considers aspirational. These types of surprise successes are always our favourite educational experiences with clients.

What technological advancements in generative AI are you anticipating might impact and evolve the influencer space?

With generative AI, we can hyper-personalise product recommendations within shopping experiences, which can be more flawlessly integrated into influencer marketing and lead to higher conversion rates.

Influencers will be much more adept at personalising content — users will receive products that are much more tailored to their preferences and shopping history. For example, if an influencer posts something today that includes a Nike shoe — and that post gains traction and starts converting at a high rate — then tomorrow, we can serve their cohort with related product recommendations, making that experience more meaningful for everyone.

We expect the coming years to bring significant innovation, changing the way consumers connect and shop with brands. Connected commerce will power a stronger link between brands and creators — I am extremely optimistic about the future of the space.