The influencer marketing industry is projected to reach nearly $14 billion this year, up from 1.7 billion in 2016. That momentum is only intensifying, as evidenced by the rate at which social media companies like Instagram, YouTube and TikTok are launching new creator-focused tools. Instagram announced a native affiliate program, YouTube started a $100 million Shorts Fund to encourage creators to use its short-form camera Shorts and TikTok is now letting creators add programs and services to their videos via a new third-party integration feature called ‘Jumps.’
All this to say, with the accelerated shift to ecommerce in the past year, brands are realizing the need to engage consumers where they’re spending most of their time: on social media watching influencers. According to AspireIQ’s “State of Influencer Marketing 2021” report, released in January, 76 percent of marketers plan to increase their influencer marketing budget.
Research shows millennials and Gen Z want to be socially and politically engaged, as well as empowered, by brands. It’s no surprise then that AspireIQ found 68 percent of brands worked with influencers and other brand fans to help speak on matters such as the pandemic, racial justice and the elections.
With a larger spotlight on brands, consumers are placing greater importance on authenticity, which is why when a brand takes a stand on an issue, 65 percent of consumers research the company’s authenticity, according to AspireIQ.
Creators are also looking to brands to have an opinion on social matters. Fifty-two percent of influencers said that it’s important for brands to speak and act on real-world events. What’s more, 74 percent of influencers said that alignment with their personal brands is the most crucial factor for deciding to collaborate with a brand. As AspireIQ notes, today that means working with brands that take a stand on the social causes they care about.
It’s also important that brands establish a personal connection upfront as 20 percent note that personalization in a brand’s outreach is the top deciding factor on whether to work with a brand. The third factor, as noted by 4 percent of influencers, is monetary compensation.
On that same note, nearly all (96 percent) of influencers are craving a deeper connection with brands, namely they want to work with brands beyond posting on social media. When asked how they’d like to engage with brands, 92 percent of influencers said they want to produce content for marketing and 91 percent said they’d like to become a long-term brand ambassador. Other ways they want to be involved with brands include co-creating products (63 percent) and co-creating events and panels (51 percent).
Marketers already see the value in tapping influencers as brand ambassadors as AspireIQ found that 73 percent of marketers have a brand ambassador program or plan to launch one in the near future. Ambassadorships afford a brand multiple benefits: exclusivity, diverse audiences, evergreen content, better rates and authentic endorsements.
Brand ambassadors often agree to form an exclusive partnership with a brand, which means the brands can monopolize the ad space on their ambassador’s social media feed. Another perk that comes with recruiting ambassadors? They create evergreen content and thereby eliminate the need for annual studio shoots.
A longer-term partnership also means securing a brand ambassador for less, given brands can lock in rates with them upfront. Lastly, investing in brand ambassadors comes with authentic endorsements. When an ambassador genuinely likes a brand, they’ll post about it several times, sometimes organically.
Last year, AspireIQ found that micro-influencers, creators who have between 10,000 and 60,000 followers, achieve 42 percent higher engagement rates than their macro-influencer counterparts, creators who have more than 200,000 followers. Hence why 60 percent of marketers today are working with nano- and micro-influencers, according to AspireIQ.
As brands begin their search for the perfect influencers, AspireIQ suggests focusing less on finding influencers with a massive following size and focusing more on creating lasting partnerships with passionate brand enthusiasts. More brands seem to be doing this already as 93 percent told AspireIQ they worked with other community members in addition to traditional influencers.
Based on AspireIQ’s analysis of thousands of social media posts, influencers see the highest engagement rate on YouTube (18 percent) and TikTok (16 percent), compared to just 3 percent on Instagram.
Still, 85 percent of brands said they plan to increase their presence on Instagram this year, followed by 49 percent who said the same about YouTube and 47 percent for TikTok. The last figure represents a huge jump from last year, when just 12 percent of marketers told AspireIQ they’d grow their presence on TikTok.
Thirty-five percent of brands plan to cut back on Twitter, 32 percent plan to do the same on Snapchat and 31 percent will decrease their presence on Facebook.
As the influencer marketing landscape becomes more sophisticated, influencers have become more expensive when measured on a cost-per-engagement (CPE) basis. Based on market trends, AspireIQ estimates the current average CPE is $0.32, a 23 percent year-over-year increase from last year, when average the CPE was $0.26.
Amid economic downturn, fewer opportunities for influencer collaborations have impacted influencers’ pay rates, with 60 percent of influencers saying they’re willing to accept lower rates due to the effects of COVID-19. Another 87 percent of influencers told AspireIQ they’re willing to work with their favorite brands in exchange for free products, as long as they love the brand or the product value is high.
Though the pandemic threw a wrench in content production, one upside is that brands were able to reduce content creation costs significantly through user-generated content (UGC). On average, brands have reduced their content spend by 52 percent by leveraging UGC, reports AspireIQ. The advantages to UGC are endless: it’s quick and cost-effective to source, it’s authentic, enables for diverse subjects and locations and it adds social proof.