Brian Mechem is COO and Co-Founder of Grin , a software solution for companies who run influencer marketing programs. Grin's software powers some of the best influencer programs in the world, providing insights on ROI and adding efficiency to the influencer marketing process
Importance of influencer marketing has risen, but have anyone count the ROI of time and money behind this concept?
These days, the moment “digital marketing” or “social media marketing” gets uttered, we can’t help but include influencer marketing. Many marketers swear by influencer marketing because it’s effective on younger audiences who don’t believe in advertising.
However, marketers agree that it gives them a hard time to calculate the ROI of their influencer marketing campaigns.
Let’s see what we can gain from influencer marketing campaigns.
1. It Increases Sales
Did you know that 53% of companies use influencer marketing strategies to increase their sales? The feedback and reviews from influencers are completely genuine. Such authenticity helps brands win the trust of their customers and encourages them to make more purchases.
70% of millennials are influenced by social recommendations while making a purchase decision. Therefore, recommendations by influencers can definitely increase your sales.
2. Generates Great Content
Influencers know their audience and therefore create the right kind of content that works for them. The added benefit is you can always repurpose the content for other marketing communications.
3. Establishes Your Thought Leadership
Consumers can associate an influencer’s thought leadership with your brand. Therefore, if your influencer is an expert in a particular field, it adds value to your brand by strengthening your authority in the field.
4. Gets You More Engagement
Authentic and engaging content from influencers is what attracts their audiences towards them. It encourages their followers to engage with such content too. Many influencers believe that their sense of humor and honesty are the reasons for their high engagement rates.
According to Linqia, 89% of companies use influencer marketing to share authentic stories about their brand. Due to such authenticity, followers continue to engage with an influencer’s branded content. And in this way, audiences are effortlessly transformed into becoming paying customers for brands.
5. Multiplies Your Reach and Access to New Markets
Influencers can help brands tap into and explore new markets and expand their reach. Many people largely depend on the recommendations of influencers. So, this helps brands access new potential customers and win their trust.
6. Improves Search Engine Ranking
Did you know that 47% of marketers use influencer marketing to boost traffic to their websites? Using influencer marketing, you can also improve your search engine rankings.
You need to ask influencers to write and share their honest reviews about your products or services on their blogs. This can help you get the attention of your prospects and gain valuable backlinks that can help to improve your rankings on search engines.
The ROI of Influencer Marketing
A study by RhythmOne found that you can generate massive ROI in earned media value using influencer marketing. Influencer marketing has helped companies generate $11.69 for every $1 they’ve invested.
In addition, 76% of marketers agree that influencer marketing has helped them build brand awareness on social media. Almost 71% of companies have agreed that it helps them reach more targeted audiences.
When calculating the ROI of your influencer marketing, you should also keep the following points in mind:
1. Influencers’ Cost
No matter how you are paying your influencers - cash, kind, event tickets or any free service - it would incur you some cost. Obviously, the bigger the project, the higher the cost would be. You can also opt for an affiliate model where you give a percentage of sales to the influencer.
2. Time Invested
A lot of your time will be invested in planning and executing your influencer marketing campaign. You’ll have to especially invest your time into communicating with influencers and helping them understand your goal and the brand personality.
3. Cost of Hiring an Agency or Buying a Software
For bigger projects, marketers might need to hire agencies to kickstart their influencer marketing program. You might need to too. If you’re among the businesses that require the help of an agency, make sure you consider the agency cost. And if you’re investing in an influencer marketing platform, consider the cost of that.
Check out the infographic below to further discover more factors to consider when calculating influencer marketing ROI.
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