Have you ever ordered the Charli drink from Dunkin Doughnuts? Dunkin Doughnuts partnered with Charli D’Amelio, a famous influencer with a whopping 144.3 million followers on TikTok, to create a drink for her audience to increase the brand’s sales and reach. If you have ever ordered a medium cold brew with whole milk and three pumps of caramel swirl, you may have just been influenced.
Between the rise of social media and the COVID-19 lockdown, influencers and collaborations have skyrocketed. Brands like Dunkin Doughnuts, Chipotle, Oreo, and Hello Fresh have all created influencer campaigns on social media platforms within the past few years.
But what are the logistics of an influencer marketing campaign? Do the risks outweigh the rewards for food and beverage companies? In this ever-changing world of technology, algorithms, and saturated markets, it can be hard to decide if influencer marketing is best for your business.
The Risks of Hiring an Influencer:
The Risk of Fake Followers
Anyone can buy bot followers on the internet. You may think that an influencer has ten thousand followers, but if five thousand of those were bought, it is not a real audience. According to PR Week, at least 55% of Instagram influencers have engaged in follower fraud and influencers with fake accounts will cost advertisers 1.3 billion dollars this year. To decipher if an influencer has a genuine audience, make sure their engagement rate reflects the number of followers they have, check to see if they have any spam comments, or use a Chrome plugin like Upfluence.
The Risk of an Influencer’s Power
With great power, there is a great responsibility. When hiring an influencer, you need to make sure that the product you send is in pristine condition. Daily Harvest, a meal delivery service, made a fatal mistake when they sent influencers lentil crumbles that caused gastrointestinal distress, hospitalizations, and organ damage. While a good review can elevate your brand, a bad review can destroy it.
The Risk of Choice
In this day of age, anyone can hide behind a screen. As a brand, this makes it hard to tell who influencers truly are and if they are right for your campaign. In 2017, Pepsi and Kendall Jenner collaborated together to create a commercial surrounding the Black Lives Matter Movement and police brutality. While the original idea was to promote peace and community, Kendall Jenner, a white woman born into a prestigious family, has probably never experienced her rights or privileges being taken away. As a result, the audience Pepsi was targeting could not relate to the glamorous influencer. To ensure the influencer aligns with your brand and values, make sure you understand their audience and character.
The Risk of Authenticity
Because of the saturation of the influencer industry, influencer ads can seem fake or untrustworthy. It is hard for users to determine if their favorite social media page really likes that product or if they are just promoting it because they got paid. If the influencer has a solid audience this is less likely to occur. No matter how many products a true influencer posts a dedicated follower will listen. Make sure that the influencer you hire is authentic with their audience and true to their own personal brand.
Risk of Competitors
A full-time influencer that works independently is likely to work with multiple brands at one time, which means your influencer might be promoting your competitors’ products. While you can try to convince them to sign a non-compete, this is unlikely. Full-time influencers rely on a steady flow of income and won’t limit themselves to one brand for their niche. If an influencer’s feed becomes too saturated with other collaborations, your brand may not reach much brand awareness as you would like it to.
Risk of Type of Influencer
There are many different types of influencers you can choose from depending on how large their audience is. Micro-influencers have influencers ranging from 10k-100k followers, while macro-influencers have followers ranging 100k-1M and above. Your choice can affect whether your campaign will succeed or fail. Micro-influencers commonly have less experience as an influencer and their posts have a small reach and brand awareness compared to macro influencers. However, they could come across as more authentic and your budget could stretch to more influencers if you go the micro route. Macro-influencers on the other hand are usually expensive and have lower engagement rates. Depending on what your goals are will determine what influencer to use.
The Risk of Rule Breaking
As influencer marketing has grown over the years, the Federal Trade Commission has authorized rules and regulations for sponsored ads from influencers. If not complied by the influencer you hire, your brand could be in trouble. In 2020, Teami, a herbal tea business, was sued for 1 million dollars by the FTC for improper influencer practices. The FTC sued on the basis that Teami partnered with well-known influencers who did not disclose to the public that they were paid to endorse Teami products. To avoid this issue and find reliable influencers, check out influencer marketing agencies like Peersway, #paid, or Creator IQ that will match you with creators based on your niche.
There is always another side of the story. While there are risks to influencer marketing, there are also benefits.
Pros of Influencer Marketing
Reaching your audience on a personal level
When executed properly, influencer marketing can help you reach your customer on a very personal level. Unlike celebrities, influencers have a trusting audience because of the user’s realistic and genuine aura. A study done by the Digital Marketing Institute says that 49% of consumers rely on influencers when making purchasing decisions.
Repurposing influencer content
A benefit of hiring an influencer can be repurposing their content on your own brand’s media pages. This will not only save you time from investing money for internal social media posts, but people might recognize the influencer and follow your brand’s page.
Achieving a more flexible marketing budget
Traditional marketing can cost brands thousands. However, with the flexibility of influencer marketing, you can adjust your budget depending on the influencer’s following. Additionally, according to the Influencer Marketing Hub, influencer marketing has a greater return on investment than traditional marketing, with every $1 spent creating a $5.81 profit.
Utilizing Macro and Micro-Influencers
When you do pick the right type of influencer, it can go extremely well for your brand. Macro-influencers are experienced in the industry and are great for incredible reach and brand awareness. Micro-influencers on the other hand can give your brand immense engagement for a reasonable price while remaining authentic and genuine.
Increased Reach and Visibility
By using an influencer, you can increase your reach and visibility by showcasing your brand in front of thousands of your ideal customers. For one of Chipotle’s influencer marketing campaigns, they created the #GuacDance video for their partnership with influencer Loren Gray. According to Kolsquare, the video generated 706k likes and 5k comments, and then evolved into a viral trend. The trend resulted in 500M views and resulted in the highest performing brand challenge in the United States. With an influencer’s concentrated audience, you will more than likely able to reach consumers quickly and easily.
Does it Work?
So with all this information being said, what is the reality of this type of advertising? With how saturated the influencer industry is, this type of marketing still works and is consistently growing. According to a report done by Mediakix, 71% of marketers agree that the customers and traffic received from influencers are of superior quality and according to GRIN, a creator management platform, 59% of marketers plan to increase their budget to accommodate for more influencers.
Do your research and do not worry about the risks of influencer marketing. Find a content creator that aligns with your brand and reach out to them. You never know how big it will positively impact your business.