Marrying technical rigidity with unrestrained creativity? Due to its ability to transform brand engagement with creators on social media, programmatic influencer marketing is here to stay.
Millennial consumers have been abandoning traditional media channels and instead becoming increasingly invested in social media. However, with an overwhelming amount of programmatic advertised content, marketers may find that PPC ads may not reach the desired performance levels.
As eliminating digital noise basically is becoming the new lifestyle trend, there is an urgent need to refocus marketing efforts in 2019. Luckily, marketers may find a new lifeline in the growing appetite for creative content produced by social media influencers.
Exposing products and services in front of an audience with an authentic voice can work wonders. Some studies show that influencer marketing can return US$6.50 for every $1 spent. Clearly, there is a consensus across social media: Influencer marketing represents an opportunity to promote a brand in an extremely cost-effective way.
The biggest pain point for marketers always has been where to allocate their budgets most efficiently. Influencer marketing presents an equation with too many variables, and companies may find themselves in a dilemma when considering which specific content creator to contract.
Scaling is practically impossible, and even with budgets that exceed $100,000 for a single campaign, results are not guaranteed. Perhaps that’s about to change. There is an emerging phenomenon of programmatic influencer marketing that brings quantifiable metrics.
A Game Changer?
In the era of digital disruption, the nature of marketing has changed dramatically. As the Internet approximated advertising to practically anyone, the abundance of ads has diluted marketing efforts. Being overwhelmed with commercial content has made consumers increasingly resistant to click-on ads and affiliate marketing links, while ad blocker tools have made it more difficult for marketers to reach their audiences.
To overcome these new challenges, advertisers have been exploring how to engage with consumers in a more creative and genuine way. A growing number of brands have been establishing their presence on social media to engage with their audiences.
However, social media platforms give consumers basically unlimited freedom and choice over the content they wish to consume, which has made it increasingly difficult to reach them. Targeting audiences right where they are without seeming disingenuous requires a peer-to-peer approach. We are witnessing a shift toward direct engagement with consumers.
The influencer marketing sector has been making its way to the forefront. In recent years, it has been developing rapidly, and the volume of the industry is estimated to reach $6.5 billion in 2019. Audiences crave creative content, even when it’s promotional: Many paid social advertisements are viewed from the beginning to end.
Demographics suggest that influencer marketing will become even more relevant. As millennials grow older and switch priorities, Generation Z gradually will take over social media. The Gen-Z demographic is more globalized, more focused on individuality, and has higher expectations, making millennials ideal participants in the influencer-follower trend.
The Risks of Betting on the Wrong Brand
As brands delegate more time and funds to influencer collaborations and sponsorships, it’s necessary to assess the prospects of these ventures. The price of promoting one’s content by an Instagram influencer is $1,000 dollars per 100,000 followers, according to an industry expert. On YouTube, prices reach $100 per 1,000 views. With billions of dollars at risk, brands need to be careful about not betting on the wrong horse.
That uncertainty is the main reason some brands are still reluctant to plunge into the world of influencer marketing, as there have been prominent scandals and issues in the past. For example, it can be challenging to determine whether the influencer is really influential. Apparently, more than 10 percent of influencers in the UK bought fake followers in the first half of 2018. In an era when 94 percent of marketers think that transparency and authenticity are key to influencer marketing success, it’s curious that there are no established rules for influencer marketing.
However, an important discussion has been going on about how to measure influencer performance in sponsored posts. There have been attempts to develop elaborate indicators to assess results, but none of them have proven completely reliable.
The classic key performance indicators (KPIs) are not always sufficient; therefore, influencer campaigns usually are assessed over time through increased sales or other indicators. The measurement of the return on investment (ROI) of influencer marketing remains a major challenge, even though the majority of marketers believe that this benchmark is critical for the future success of influencer marketing.
A New Phenomenon: Programmatic Influencer Marketing
The pressure for standardization has introduced a new solution: programmatic influencer marketing. By developing a clear set of measures to evaluate influencers and their performance via analytics, this marketing method provides a layer of transparency.
There are platforms on the market that assume the intermediary position between a brand and an influencer. Many offer technological tools that enable the whole process, from influencer selection up to result assessment, while monitoring each stage of the process. Bringing a systematic approach to addressing chaos has various advantages for both influencers and brands.
Automatizing influencer marketing allows for mass scaling and better outreach. Brands can engage effortlessly with any number of influencers to reach their goals and know exactly how much they are paying to do it. This is because programmatic platforms enable tracking and prediction of influencer performance, allowing users to calculate the exact costs of their influencer ads (per view, click or conversion).
This is great news for experts who have been campaigning for clarity and fairness in influencer marketing in the past. Also, it presents a significant step toward securing ROI, because even if a collaboration with one influencer fails, the platform redirects the strategy to another one, avoiding financial loss.
Ensuring security is another key aspect. As the platforms operate a pool of influencers, any particular influencer who becomes discredited due to dubious practices — such as collecting fake followers, for example — can be eliminated from collaborations. This brings an unprecedented level of fairness to the whole industry.
The benefits for brands are straightforward, but why should influencers subject their activities to scrutiny? Actually, signing up for a programmatic platform can provide them with many long-term benefits as well — undeniably, access to new opportunities. This is particularly important for micro-influencers. As many marketers agree, influencers with “only” tens of thousands of followers may be a better fit to subtly but effectively increase brand awareness. These personas often have niche audiences and are particularly passionate about choosing the branded content that fits their overall image. For them, these platforms represent an important networking space.
Apart from securing more contracts, the intermediary can simplify the communication with brands. As many influencers are adolescents, they may not be aware of their market value, or of the ways to reach out and launch a collaboration. In a way, the intermediary can substitute for the role of an agency. Perhaps more importantly, if the industry develops in the right direction, working with a platform could become a certificate of an influencer’s quality in the future.
Technology as the Enabler
How do programmatic platforms secure these benefits to both sides? The answer is simple: through a complex interplay of various emerging technologies.
For example, the smart matching between a brand and a social influencer is enabled via artificial intelligence that assesses both parties, based on the type of industry, target audience, content type and performance. The tool then scans hundreds of thousands of influencers to pick the perfect fit. When it comes to analytics, sophisticated machine learning algorithms come into play. These engines predict an influencer’s performance based on past endeavors in order to calculate the market price.
In upcoming years, programmatic platforms likely will adopt practices that are common in other branches of marketing, such as bidding on an advertising opportunity — or an influencer, in this case. From a marketing point of view, each YouTube channel can be seen as a television: If you want to get your message on a particular channel, you may need to pay more than another brand.
However, the application of technology in influencer marketing isn’t limitless. The content published by the influencer still has to be reviewed manually, and there always will need to be a human element to ensure that every piece of video and every photograph follows specific content and brand guidelines, is not explicit, and does not violate the rules of the specific social media network.
Programmatic influencer marketing still may be in its infancy, but it has a bright future. Brands can abandon estimates and guesses and fully embrace a data-driven approach, helping them to optimize their marketing strategy and aim their focus exactly where it is needed.