US advertisers are so enamoured with influencer marketing that a full 75% of their companies currently employ the discipline and almost half (43%) are planning to increase their spending on it in the next 12 months.
Those are the findings of a new survey from the ANA (Association of National Advertisers) on how ANA members are using influencer marketing, which also revealed that of those respondents not currently using influencer marketing, 27% indicated they plan to do so in the next 12 months.
For survey purposes, the term influencer marketing was cited from eMarketer and defined as “marketing that identifies and activates individuals who can sway the brand preferences, buying decisions, and loyalty of the broader population.” The report also said on social platforms, the term typically describes “the process in which companies compensate celebrities, social media ‘stars,’ or industry experts to create content on behalf of brands or provide endorsements for brands.”
The survey found that Facebook (86%) and Instagram (84%) were the overall top social media channels for influencer marketing, with Instagram ranking as the single most important channel (36%) followed by Facebook at 20%.
“It’s clear that the popularity of influencer marketing has increased among marketers in recent years, largely due to the growth and evolution of social media,” said ANA CEO Bob Liodice. “We’ve found that a growing number of marketers are turning to influencers to help them combat ad blocking, leverage creative content in an authentic way, drive engagement, and reach millennial and gen Z audiences who avidly follow and genuinely trust social media celebrities.”
The study pointed out that brands hire influencers with audience followings ranging from as few as 50 followers to over 100,000. For the purposes of the report, influencers were defined as micro (50 to 25,000 followers), mid-level (25,001 to 100,000), and macro (over 100,000).
• Influencer Marketing Objectives: The great majority of respondents (86 %) stated that general brand awareness was an objective for engaging in influencer marketing. More than two-thirds (69 %) said they utilize influencer marketing for content creation and distribution, and over half conduct influencer marketing to improve brand perception and drive purchase (56 % and 51 %, respectively).
• Mid-Level Influencers Most Popular: More than half of brands using influencer marketing (66 %) use mid-level influencers; 59 % use micro-influencers and 44 % use macro-influencers.
• Influencer Compensation: Almost two-thirds of brands (62 %) compensate influencers monetarily, while over one-third of companies (35 %) provide free product in exchange for influencer services. Thirty % provide monetary compensation for each individual post. Among respondents with knowledge of how much compensation their brands’ influencers receive, 62 % said they spend under $100,000 annually and 38 % spend over $100,000.
• Marketer Satisfaction and Effectiveness: A majority of respondents (54 %) were either satisfied or very satisfied with the performance of their influencer marketing. However, 39 % of respondents felt neutral about their influencer marketing performance, as they have not been involved in influencer marketing long enough to judge their performance and/or are engaging in small-scale testing. Forty-four % of respondents stated they were neutral about the effectiveness of their influencer marketing, 36 % feel their influencer marketing is effective, and 19 % said it was ineffective.
• Legal Disclosures: Thirty-eight % use #sponsored and 35 % use #ad to convey that an influencer post has been paid for and sponsored by a brand. According to FTC guidance, ambiguous disclosures like #thanks, #collab, #sp, #spon, or #ambassador are not sufficient to disclose the material connection between the influencer and the brand, despite their prevalence in influencer marketing.
• Set Objectives and KPIs to Gauge Influencer Effectiveness: Develop an understanding of not just influencers and their content but the makeup of their followers to ensure alignment with pre-determined objectives. Know what tracking measures and KPIs an influencer can provide and deliver on before entering into an agreement.
• More Followers Don’t Always Equal Better Results: An influencer with a large following may result in extensive exposure but fewer sales conversions if those followers do not trust the influencer recommendation. Also, many influencers may share similar followings, meaning that when a marketer works with two accounts that have 10 million followers each, the message doesn’t necessarily reach 20 million people.
• Be Aware of and Comply with FTC Guidelines: FTC guidelines require disclosure if there’s a connection between an influencer and the marketer that consumers would not expect based on the endorsement. Don’t assume that using a platform’s disclosure tool is sufficient. It is important to realize that many followers are accepting of sponsored content, but are offended by disingenuous or inauthentic content.
The survey was conducted in November 2017 among a total of 158 client-side marketers. Respondents had a median of 20 years of experience in marketing. About half (53 %) focused their marketing on business-to-consumer efforts, 11 % on business-to-business marketing, and 36 % on both business-to-business and business-to-consumer. A total of 72 % of respondents worked at companies with annual U.S. media budgets under $100 million, and 28 % worked at companies with media budgets of $100 million and more.