Influencer marketing is booming – it has doubled in size to $13.8 billion in just three years. Influencers add value to brands by enabling marketers to connect with audiences in authentic, engaging ways that consumers respond to.
However, as the industry matures, we continue to hear concerns about measurement and defining success in relation to influencer marketing campaigns. Marketers frequently inquire, “What does return on investment really mean when working with influencers?”
The reality is that there is no single answer.
One of the reasons influencer marketing is such a powerful strategy is its ability to achieve a broad range of marketing objectives – from brand discovery and awareness to conversions and lifelong loyalty. To understand what a successful influencer marketing campaign looks like for your brand, you must first define your marketing objectives. Once you’ve established a specific objective, you can develop KPIs that accurately measure your success.
Building brand recognition
If a marketer wishes to work with influencers to increase brand awareness, they should begin by establishing relationships with well-established influencers with large followings. Working with influencers whose passions and values align with a brand’s message and purpose is critical to a successful brand awareness campaign.
However, once you’ve identified the appropriate influencers for your brand awareness campaign, how do you determine whether your strategy was effective?
Social engagement is a critical metric to track. If influencer posts receive a high level of engagement, this indicates that your brand message is being effectively communicated to the influencer’s audience. Additionally, social mentions and campaign hashtag usage can be used to gauge brand awareness. If an influencer strategy is successful, people will take an active role in branded campaigns by sharing relevant hashtags or directly tagging the company’s corporate handle. Similarly, you should anticipate an increase in your following as more people become aware of your brand.
Bear in mind that marketers who invest in brand awareness campaigns at the start of their influencer journey frequently experience what we refer to as the influencer “halo effect.” This is the influencer’s extended value beyond a single campaign – established influencers frequently inspire both their peers and up-and-coming influencers to engage with a brand. This broadens the reach of the audience in novel and exciting ways and attracts new customers.
Fueling the bottom line
After establishing a brand’s online presence through brand awareness campaigns, opportunities for lower-funnel growth become more important. Influencers can assist brands in driving direct sales in a variety of ways, but one of the most effective is through the use of affiliate links. Affiliate links enable influencers to promote brands’ products and services that align with their audience’s values and passions proactively. And influencers are then rewarded for driving sales by earning commission on each purchase made via a follower clicking on their posted affiliate link.
Measuring the return on investment for influencer marketing strategies that are intended to increase conversions is a bit more straightforward. Examining the click-through rate for influencer affiliate links is an excellent way to determine how much time people spend on product-specific content. Marketers should take note if their click through rates are high but their conversion rates are not increasing in lockstep. Other variables on the merchant’s end could be causing people to abandon their shopping carts – for example, pricing, stock limitations, and so on.
Setting benchmarks is key
Whatever your influencer marketing campaign’s objectives, one thing remains constant: the requirement for aspirational yet attainable success metrics. To calculate the return on investment on any investment, marketers must first define what success looks like and, when multiple objectives are at stake, prioritize objectives for each campaign.
Setting objectives for increasing brand awareness or driving sales is critical for determining whether an influencer marketing campaign succeeded in achieving the initiative’s overall goal.
Therefore, if you’re a marketer considering incorporating influencers into your marketing mix, consider what you hope to accomplish through collaboration with influencers, how you’ll measure success, and then develop an influencer marketing strategy that assists you in meeting those specific campaign milestones.