In this guide we’ll cover our latest influencer marketing findings conducted in partnership with research firms while also providing some of the industry’s leading statistics.
20 min read
The history of influencer marketing reveals one indisputable fact: this innovative marketing technique gets results. As more people tune out traditional advertising and turn to people they trust for recommendations on where to go and what to buy, influencer marketing has stepped in to fill the void.
In early 2018 AdWeek published an article predicting that influencer marketing would be a $10 billion industry this year, Forbes reported that it could be worth up to $16 billion or more. Brands and businesses of all sizes have stood up and took notice, with nearly two-thirds of marketers increasing their spending from 2018 to 2019. As these statistics suggest, the tide is rising and there doesn’t seem to be a slowdown anytime in the near future.
Influencer marketing results fuel its growth and seemingly secure its place in savvy marketers’ toolboxes. But if you’re new to practice, you might be unsure of what to expect. In this guide you’ll find important industry statistics and monthly insights from our findings conducted in partnership with research firms, The Right Brain Consumer Consulting (study design, analysis, and management), and Kantar (survey fieldwork and data processing).
National online survey fielded in September of 2019
- The Right Brain Consumer Consulting (study design, analysis, and management)
- Kantar (survey fieldwork and data processing)
- 250 Influencer and Content Marketers aged 22-69
- Final sample was 61% female and 39% male
- All respondents required to have professional experience with Influencer and/or Content Marketing
- Final sample included 193 Influencer Marketers (77% of sample) and 242 Content Marketers (97% of sample)
- All were communications/media agency or client-side marketers
- Spanned spectrum of organizational titles/levels
Top 5 Findings of September 2019 Report:
- Experienced marketers say Influencer and Content Marketing is the most effective method of marketing compared to traditional forms of marketing.
- Only ¼ of marketers believe TV is the most effective advertising medium today, with nearly 2/3 believing it is less effective than in the past and it receives too much advertising investment.
- Financially, both Influencer and Content Marketing are perceived by the majority of experienced practitioners as having superior ROI to all specific alternative marketing approaches measured.
- Brand Marketers now turn to both agencies and influencers to produce their content — and the majority perceive Influence Marketing content to be a better value than agency-created content.
- While Influencer Marketing is regarded as effective and a good value, celebrity influencers are perceived by most marketers to not be a good value for the money.
Other Facts Worth Highlighting
- Get ready for 2020! Over 2 in 5 Marketers plan to invest more resources and budget to Influencer Marketing in 2020 vs. 2019 Only 5-6% anticipate investing less next year.
- Two out of three marketers would give up some of their traditional media budgets (TV, radio, magazines, newspapers) to spend more on Influencer and/or Content Marketing)
- Over half of Marketers believe that their companies are spending too little on Influencer Marketing
- Influencer Marketing Wins the Head-to-Head ROI Battle!
- According to Marketers, Influencer Marketing is seen as superior in ROI…
- To print advertising by about a 4 to 1 margin
- To radio by an over 3 to 1 margin
- To online banner ads by nearly 2 to 1 margin
- According to Marketers, Influencer Marketing is seen as superior in ROI…
1.Generate a Positive ROI
In a study done by Nielsen Catalina Solutions, influencer marketing content delivers 11X higher ROI than traditional forms of digital marketing and according to a Tomson study, businesses earn $6.50 for each dollar spent on influencers with the top 13% earning $20 or even more. That said, many businesses and marketers find calculating ROI challenging.
Pro Tip – Measuring the ROI of your own campaigns:
- In addition to measuring the campaign’s performance, measure the influencers by providing each with custom URLs to track traffic and influencer-specific discount codes. This makes it easy to track the effects of each influencer
- Set goals and key performance indicators (KPI) for each influencer (impressions, clicks, engagement and conversions for example) to best understand the contribution each individual is making to the campaign
- Choose an influencer marketing platform that can help you track performance and ROI
2. Increase Brand Awareness
The best influencers – and this is true of big names and microinfluencers with smaller followings – develop strong relationships with their followers. In turn, this builds trust. So, when an influencer promotes your products, services and businesses to the people who look up to them, it increases your reach exponentially. It helps connect you with new audiences and your target audience alike. Some of the statistics from the Digital Marketing Institute underscore this:
- 86 percent of women and nearly three-quarters of all buyers use social media for advice on what to buy
- Nearly half of consumers depend heavily on influencer recommendations
- Six out of 10 teenagers trust influencer recommendations more than traditional celebrities
Influencers connect you with wide swaths of your target audience beyond the people already familiar with you. It boosts your brand’s credibility and leverages the power of word-of-mouth marketing. Keep an eye on KPI like social reach, engagement, mentions in the media, press and website traffic to watch brand awareness grow.
3. Boost Sales
Developing brand awareness is great, but using marketing tactics of any kind is designed to boost the bottom line, right? Influencer marketing results include driving sales and attract higher-quality customers to your business. They’re effective in all phases of the buying process.
During the consumer research phase, influencers provide trusted content that generates leads. It also lets followers know why to choose your product while helping to answer questions or concerns they may have. They also establish brand credibility by providing a second perspective outside of your own self-promotion. Once consumers are ready to buy, influencers provide the reassurance they need to ease buyer’s remorse.
The key to maximizing this benefit – and any benefit from influencer marketing, really – is choosing the right influencers. To do that, follow these three tips:
- Choose On-Brand Influencers: Look for influencers with a message that resonates well with your target audience. After all, when they create content to represent your brand, you want it to be aligned with your brand values and of interest to your potential consumers. You also want it to be high-quality content that represents you well.
- Value Engagement Over Reach: The number of followers an influencer has isn’t the most important factor you should consider. Microinfluencers have a relatively small reach but a very targeted audience. The engagement rate measures the number of comments, views, shares, likes and reactions an influencer gets on any of the available content platforms. It’s a key indicator of how the content resonates with their audience and prompts them to take action.
- Don’t Forget the Budget: One of the best things about influencer platforms is the ability to filter results by budget, which lets you choose influencers that are within your price range. If you’re just starting out, consider working with microinfluencers. They typically don’t have agents who charge additional fees.
As social media has moved from a “shiny new thing” to an integral element of everyday life, influencer marketing has maintained its chart-topping strength as an effective form of marketing messaging in the minds of marketers and consumers alike. These and other industry-relevant findings have been revealed in IZEA’s 2018 “State of the Creator Economy” report, commissioned by IZEA and conducted in partnership with research firms The Right Brain Consumer Consulting, Lightspeed GMI, and Research Now.
The study, previously known as “The State of Sponsored Social,” is the industry-leading independent view of both the influencer and content marketing categories from the vantage points of creators, consumers, and marketers.
The 2018 study shed light on the impact of the maturation of social media as a part of contemporary culture and the seeming societal impact of widely-discussed topical issues related to media and privacy.
“This year’s learning must be interpreted through both a broad cultural lens and a narrow marketing-specific lens,” says Jana O’Brien, principal at The Right Brain and chief consultant on the study. “We identified three broad trends that likely shaped the 2018 findings: social media maturation, natural selection, and cultural scrutinization. Social media has clearly matured and become an integral part of everyday life rather than a ‘new thing.’ As a result, consumers seem to be naturally selecting their preferred platforms, picking and choosing which social media best fit into their lives and focusing more on those. And third, in the wake of some shaken trust in all media sources, consumers are scrutinizing all marketing messages more than in any previous wave of our study.”
Influencer Marketing Approaches Used
Platforms with rapid-timeline-decay (Instagram Stories, Snapchat) are gaining popularity.span style=”font-family:g-bold;”> The use of sponsored videos is rising, up 22% in 2014 to 50% in 2018.
Factors of Importance
Marketers are mostly concerned with the quality of content when it comes to Influencer Marketing — great content can have an advantage over raw traffic. In the past decade, Influencer Marketing as an industry has grown, and Influencers nowadays understand better what type of content brands are looking for.
Marker objectives for Influencer Marketing
Overall, brands are interested in building engagement when using Influencer Marketing. The approach seems to be making sure to stay in the awareness of consumers. Though it should also be noted that 1 in 3 consumers said that Influencers specifically drove them to a purchase decision.
Companies Engaged In Influencer Marketing
70% of the companies surveyed utilized Influencer Marketing, with 73% of those also saying they have a standalone budget just for it — this means around 51% of all companies surveyed have a dedicated Influencer Marketing budget.
Influencer Marketing Budgets
Nearly 40% of companies surveyed spend between $1M and $5M on Influencer Marketing, with the media being between $500k and $1M. Only 10% of companies had no specified budget for Influencer Marketing, implying that most companies aren’t placing enough attention on this form of marketing to create a dedicated budget.
Expected Price Per Post
Marketers are under the impression that Influencer Marketing is more expensive to do than it actually is — they expected the costs to be 3 to 13 times higher than what Influencers actually charge. They also seem to expect to pay more for visual content, with live streaming and video content having the highest perceived cost.
Sources of Influencer Income
With the rise of short-form and rapid-timeline-decay content, Influencers are finding different ways to earn income. Influencers are moving away from display ads on blogs, with the usage of this type of ad declining from 76% in 2014 to only 60% in 2018.
Creator Platforms Used
Influencers are favoring fast-paced platforms, with Instagram and Facebook being where they post the most content. Longer form content such as blogs and platforms like Linkedin are slowly declining in popularity.
Factors When Working With Brands:
Creators are concerned with more than just compensation when choosing what brands to work with, or even how to go about creating Influencer Marketing Content. Among the highest-ranking factors that Influencers consider, there is the issue of finding brands and products that already fit seamlessly with their voice and previous content, and the ability to more easily screen opportunities for creating content.
Consumer Platform Usage
YouTube and Facebook continue to be the undisputed kings, being used by nearly all consumers — they are the ubiquitous platforms. A strong second category contains Instagram and Twitter, two major players in bite-sized content. The third category includes platforms with “specialty content”, such as Twitch (who specializes in live streaming of gaming.)
Age also plays a factor — this study does not factor in Snapchat, because it has mostly remained popular only with young users in their teens (the majority seems to not continue consistently using Snapchat past their college years.)
Usage Frequency Amongst Consumers
Visual platforms, especially those that are fast-paced with feeds that decay quickly, are gaining popularity. People will wait to read a blog post, but checking out a celebrity’s Snapchat that everyone on Twitter is talking about creates urgency — it might be deleted, or expire, before they see it. This means consumers are more plugged into these platforms.
The “Famous” and the “Regular” People
Consumers seem to prefer different platforms for following celebrities, versus platforms where they follow friends and family. YouTube and Twitter see the biggest increase in people following the famous, while users on platforms like Tumblr and Facebook seem to favor following their actual friends.
Interestingly, Instagram is possibly the most balanced platform, with users following the most balanced mix of celebrities and people they know.
Ad-Blocker Usage Amongst Consumers
With over $100B projected to be spent on digital ads, the question arises of how ad-blocking software affects marketing. Influencer Marketing seems to not be slowing down anytime soon, and part of that is because consumers are now more interested in getting their content without the clutter of display ads. Increasingly, ad-blocking software is being installed on people’s laptops, desktops, and even mobile devices.
Consumer Effectiveness Rating of Marketing Approaches
When consumers rated their perceived effectiveness of marketing approaches, traditional mediums (top graph) saw a decrease in their ratings. Overall, the scores for traditional approaches ranged from 4.9 to 6.5 (out of 10.)
On the other hand, Influencer-focused approaches such as sponsored content, saw scores between 5.6 and 7.5. — with niche platforms such as Twitch and Musical.ly (now TikTok) getting the highest scores.
Variables That Impact Effectiveness
Consumers consider different factors when looking at Influencer Marketing content. With no two Influencers and no two campaigns being the same, consumers report that different factors affect their perceived effectiveness of a campaign. At the top of the list are factors such as the credibility of the Influencer, and whether the Influencer has actually tried the product they are promoting.
It is notable that an Influencer’s popularity and number of followers ranked the lowest, meaning that being well-known as an Influencer does not always translate to credibility.
FTC Guidelines: Awareness & Compliance
A pillar of the Influencer Marketing industry is trust. Following the FTC’s guidelines, and properly disclosing compensation and sponsorship, is important. As more Influencers become aware of these guidelines, it is important to also make sure the brands are familiar with them (the numbers point to up to 60% of companies lacking this knowledge.)
Loss of the consumer’s trust, which can happen with things like undisclosed sponsorships and fake followers, are the biggest threat to the industry thriving.