Growth of influencer marketing creates new markets for special service providers
Around one billion euros – that is the advertising budget expected to be invested in influencer marketing in the German-speaking world in 2020 alone. The doubling of spending in just four years clearly shows how priorities are currently shifting in the advertising world. More and more brands and companies are planning extra budgets and increasingly relying on collaborations with influencers to carve out a position for themselves in an emotive and authentic way that the public can identify with.
The rising interest in influencers as brand ambassadors is at the same time leading to a growing need for technological, procedural and creative support. “While some companies, especially from the D2C sector, are still taking influencer marketing into their own hands, more and more brands are relying to a large extent on external service providers,” observes Philip Papendieck, CEO of the full-service influencer marketing agency Intermate. Several dozen special service providers have established themselves in the German-speaking countries alone, offering a wide range of services from facilitation, strategy development and campaign management to technical support.
Development of influencer marketing in dynamic cycles
The growing field of special service providers benefits first and foremost from the rapid speed at which influencer marketing is evolving. “Looking back, we can see that the overall market has developed in dynamic cycles, depending on the available channels,” explains Jan Homann, CEO of Blogfoster, one of the technology leaders in influencer marketing. “In the beginning, there were only bloggers, but with YouTube, Instagram, Facebook, Twitter and Pinterest, new platforms quickly grew in importance. TikTok and Twitch are currently very much in trend and creating new opportunities,” Homann says.
Successful influencer campaigns: New challenges for brands
The multitude of additional options have in turn given rise to new challenges for companies:
- “Due to the strong sector growth and the new influencer channels, the number of creators has also increased massively, and these can now cover every conceivable topic. However, different channels require very differentiated approaches,” Papendieck points out. “A whole new squad of influencers is currently emerging on TikTok and Twitch. Completely different, channel-specific ‘rules of the game’ apply here, which can quickly make things too complex for brands to grasp.”
- The increasing variety also goes hand in hand with a trend in brand strategies towards tapping the potential of less wide-reaching but thematically more specialized influencers. But collaborating with several brand ambassadors increases the time and effort for communication and coordination. “How can I work with a large number of influencers spread throughout the year without having to ramp up my employee headcount,” says Homann, summarizing the challenge. “Only now, as some technology companies in the market are succeeding in greatly increasing the efficiency per creator, is there any possibility at all for large brands with high budgets to book a larger number of influencers in a structured way and also to check the result at the end,” says Homann.
- In addition, there are new formats and opportunities in social commerce, where experience is often still lacking. “How can social commerce with influencers be set up efficiently? How can I, for example, sell products from a live stream? How do I make the user journey as meaningful as possible with the new opportunities, for example Instagram Shopping,” says Papendieck, describing the associated requirements.
“Only now, as some technology companies in the market are succeeding in greatly increasing the efficiency per creator, is there any possibility at all for large brands with high budgets to book a larger number of influencers in a structured way and also to check the result at the end.”
Complex requirements for collaborating with influencers
In addition to the challenges mentioned above, conducting influencer campaigns is a very labor-intensive process. The to-do list is long, and includes:
- Strategic planning
- Selecting channels
- Finding the right influencers
- Coordinating content
- Creating and implementing content
- Measuring results
- Maintaining contacts
“Contracting and briefing as well as coordinating content are particularly time-consuming, especially when several influencers are involved in one campaign,” emphasizes Papendieck.
The correct “translation” of the content plays a crucial role in the success of influencer campaigns. “Companies must make a creative playground where influencers can grasp the brand, product and service from the authentic world and draw them into their world,” Homann emphasizes. “In addition, campaigns must be continued holistically and extended intelligently from the respective platform. Seamless transitions in the user journey are essential, for example from the channel interface to a landing page,” says Papendieck.
External service providers simplify collaborations with influencers
Along the process chain, there is now an entire industry offering specific services designed to make it much easier for companies to collaborate with influencers. If, for example, you want to find suitable influencers, there are various management or facilitation agencies who market their wide-reaching opinion leaders and take over the coordination of planned campaigns for you. A large selection of often thousands of non-exclusive influencers can also be found on special platforms like reachhero, FAMEBIT or upfluence. Most of these also take on complete campaign management.
“When selecting influencers, however, many companies make the mistake of spending a lot of money on what is in part a poor inventory, in other words influencers with poor performance or many supposedly fake followers,” explains Papendieck. “In most cases, there is a great deal of uncertainty about the results beforehand, i.e. what can I specifically expect for my budget,” Homann explains in this context.
Technical solutions for successful influencer marketing
Special research and reporting tools provide a better understanding of the data and key figures. These offer, for example, data-supported social listening as well as target group and trend analyses and also include the function of influencer relationship management. Various technology providers have also launched software-as-a-service solutions in the market that enable marketers to manage the planning, execution and evaluation of their campaigns.
The booking and control tool eqolot from Blogfoster, for instance, forecasts campaign results in advance based on historical data. “Knowing not only what influencers look like in terms of their key figures, but also how they have actually worked for their customers in the areas in question, gives brands huge advantages when selecting suitable brand ambassadors,” Homann emphasizes.
Full service by specialized influencer marketing agencies
Influencer marketing agencies are also seeing rapid growth in view of the dynamically growing market. Based on their market expertise and resources, these generally offer a comprehensive range of services for collaborating with influencers and, if desired, relieve their customers of much of the time-consuming work. Many agencies work to the full-service principle. This means they support brands in every phase of the process. Services include:
- Developing individual concepts and long-term strategies
- Influencer selection and content creation
- Success measurement and reporting
Some agencies even go beyond pure consulting and management of complex campaigns. For example, Intermate has its own production company, Truemates, which implements complex formats directly in-house for its customers, including Volkswagen, Coca-Cola, Rewe and E.ON.
Beste Schranke ever! Ohne Strom ist alles ziemlich beschränkt. Damit Ben seinen Job als Influencer behalten und weiterhin aufregenden Content produzieren kann, sorgen unsere #Verteilnetze für eine sichere Stromversorgung. #exfluencer #ohnestromnixlos pic.twitter.com/oNfVWY5zkk— E.ON (@EON_de) June 7, 2019