Money: Influencer Partnerships & Sponsorships:
Since the dawn of the internet, we’ve seen rapid and drastic changes in the marketing style of virtually every major company; though as with everything else, some have been quicker to adapt than others. A relatively recent development is what has been termed ‘The Influencer Marketing Revolution’.
While the concept of influencer partnerships and sponsorships is hardly novel in itself, we’ve seen a relatively major shift in recent years. Traditionally, major companies would always use high-level A-list celebrities to sponsor and push their products, think Nike’s Air Jordan line, and the George Foreman grill.
While this is still true today, and there’s no end in sight for celebrity footballer sponsored underwear brands, certain industries have begun to focus more on B-list celebrities, or even more so, on people who aren’t celebrities at all, but have some kind of online media presence and following, and ergo, influence. These “average joe” influencers usually present themselves as industry experts, bloggers, or niche market personalities, and often have a propensity to reach large audiences in a more direct and “real” way than out of touch millionaire celebrities ever could.
One space where this has been particularly noticeable is the tech industry. Thousands of youtube videos and affiliate blog posts are written on a daily basis comparing the best smartphones, laptops, tablets, TVs, home appliances, you name it. This clear move in the opposite direction of the “George Foreman” approach, and seems to make a lot of sense on both sides of the equation. For starters, consumers’ needs, and more importantly, budgets, are more likely to match those of an independent product reviewer, then they are a star athlete or artist. Secondly, these individuals tend to come across as a lot more credible and knowledgeable about the products they’re promoting, even if it is clear as day that they are getting paid to promote or review the products they’re speaking about. One reason for this is that people would tend to assume they are getting paid a reasonable amount of money from several different companies, and can therefore weigh out their integrity and future credibility against the relatively small temptation to push a particular product. This is opposed to the general (educated) assumption that star athletes and celebrities are paid exorbitant sums to pose for an advert for a given product and often say very little about it, which is of course another story entirely.
In reality, this is quite a natural projection when one considers the shift to sponsorship and influencer marketing coming about due to the lack of perceived credibility behind regular adverts. This becomes very clear when referencing marketing statistics such as studies which found that 90% of trust peer recommendations but only 33% trust traditional ads (Nielsen); while 88% of customers trust online reviews by strangers as much as they would a recommendation by a friend (BrightLocal). Even more interesting is the blog post which claims that up to 49% of consumers actively depend on influencer recommendations (Twitter). Even if these findings are taken with a pinch of salt, the reality that influencer partnerships and sponsorships have all but taken over the marketing industry remains undeniable.
On the other side of the coin, we have the company’s perspective. While I don’t see Nike dropping Michael Jordan’s lifetime sponsorship contract anytime soon, we can definitely see why Samsung or Apple would rather have Marquez Brownlee (A well renowned tech-influencer and product reviewer branded as MKBHD) review their products than Tiger Woods.
Aside from the credibility and reachability factor as discussed previously, we can only assume that the price tags for either sponsorship aren’t even close to being in the same ballpark. In fact, many product reviewers insist that they aren’t paid to review the items on their channels, though many admit that they do receive them for free from the product manufacturers.
Hence, it seems that influencer and sponsorship marketing, in this sense, is a win win for consumers and manufacturers alike, let alone the influencers themselves. With up to 94% of marketers finding influencer marketing to be effective (AdWeek), the numbers really do speak for themselves.
It may, however, also be interesting to look at what companies seek in an influencer. Of course, the ultimate decision will be case specific. But, it’s no secret that the sheer number of followers one has on social media tends to be quite indicative of their position as influencers, as well as the amount of sway they may or may not have when negotiating with companies seeking to push their goods or services.
However, this number can be misleading, and this isn’t just due to the existence of click-farms and fake profiles. In reality, companies need to look at the quality, or demographics of the followers an influencer has. As we said, influencers tend to work in specific niches. While celebrities may have the freedom to go well outside of what they are known for (this will be the last George Foreman reference for this post, I promise!), influencers are rarely as flexible in this regard. The reason being, that the people who follow them, do so for a specific reason. They aren’t necessarily a fan of the influencer (though this is sometimes the case), more often, they simply subscribe to the person’s knowledge of a particular area or industry, such as fashion or tech-products. So while it may not pay for a tech-company to opt for a self- proclaimed fashionista and instagram model to push their products, that influencer may also quickly start to lose followers when leaving their area of expertise.
At the end of the day, one can easily arrive at many conclusions to explain why influencer and sponsorship marketing has become the phenomenon we know today, but the underlying universal reason which no one can deny is simply that it works! Fortune 500 companies wouldn’t be doing it otherwise and the results really do speak for themselves.
If you want to find out more, take a look at Rachel Davids (CEO of a Marketing Agency) Ted Talk, named ‘How Influencers have transformed modern marketing’.
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[Written by: Jessica — This blog is a project for Study Unit MCS3953, University of Malta.]
References:
- How Influencers Have Transformed Modern Marketing | Rachel David | TEDxVancouver. (2019, March 18). [Video]. YouTube. https://www.youtube.com/watch?v=gbbEXnRG9d8
- Lee, S., & Kim, E. (2020). Influencer marketing on Instagram: How sponsorship disclosure, influencer credibility, and brand credibility impact the effectiveness of Instagram promotional post. Journal of Global Fashion Marketing, 11(3), 232–249. https://doi.org/10.1080/20932685.2020.1752766
- Marchant, R. (2020, December 7). Local Consumer Review Survey 2014. BrightLocal. https://www.brightlocal.com/research/local-consumer-review-survey-2014/
- Newberry, C. (2020, July 23). Influencer Marketing in 2019: How to Work With Social Media Influencers. Social Media Marketing & Management Dashboard. https://blog.hootsuite.com/influencer-marketing/
- Team, S. G. (2020, November 10). Ultimate Guide to Growing Your Business with Influencer Marketing. Single Grain. https://www.singlegrain.com/content-marketing-strategy-2/guide-influencer-marketing/
- The Influencer Marketing Revolution (Infographic) | One Productions. (n.d.). Video Marketing & Production Company Dublin Ireland | One Productions. https://www.oneproductions.com/influencer-marketing/
- New research: The value of influencers on Twitter. (2016, May 10). Twitter. https://blog.twitter.com/en_us/a/2016/new-research-the-value-of-influencers-on-twitter.html
- Recommendations From Friends Remain Most Credible Form of Advertising Among Consumers; Branded Websites Are the Second-Highest-Rated Form. (2015, September 28). Nielsen. https://www.nielsen.com/eu/en/press-releases/2015/recommendations-from-friends-remain-most-credible-form-of-advertising/
