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A recent report by Launchmetrics has highlighted an unexpected trend in brand-influencer relationships. It might seem obvious to assume that the more followers an influencer has the more desirable they are as a brand promotor. Apparently not so. The report suggests that brands are bypassing mega-influencers, those described as having between 501,000 and 1.5million followers, and instead opting for micro-influencers with smaller followings of 10,000 to 100,000. Coming second in the desirability ratings to the micro-influencers, are the macro-influencers with followings of 101,000 to 500,000.
The report shared the reasons behind the trend suggesting follower-count is one of the least significant factors for brands choosing an influencer to work with, and that quality of content and engagement figures rank highest on the list.
Social media platforms such as Instagram have been an intrinsic part of an increasing number of marketing campaigns for quite some time. It is now a mainstream practice for Instagram influencers to promote new fashion lines, test new beauty products, or even attend product launch nights. Yet, it’s not just those with hundreds of thousands or millions of followers who are benefiting.
The recent Launchmetrics study of 600 fashion brands throughout Europe and the US found that 78% of online brands opted for influencer-led marketing campaigns; a massive 65% increase on 2016 figures. Brands also raised their budgets for their influencer marketing campaigns by up to 6% last year with over $2 billion spent on influencer campaigns overall. 40% of the brands and professionals surveyed were within the fashion and beauty industry, most of which used product launches and events as a popular marketing tactic.
With the rise of the Instagram influencer, those statistics should come as no surprise. Nearly half of the professionals surveyed indicated that they would prefer to work with micro influencers with a following size of between 10,000 and 100,000 followers, rather than those with hundreds of thousands or even millions of followers.
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While it may seem a counter-intuitive to move away from influencers with world-stage presence in favour of those with smaller followings, the shift has been rationalized as recognizing the power of the niche. Although micro-influencers reach and connect with a smaller audience, their followers are much more likely to purchase products from the brands which they endorse. This makes micro-influencers ideal for addressing niche markets.
Instagram still holds the top spot as the most popular platform for marketers with features such as Instagram stories, with 36% of companies surveyed indicating Instagram was their preferred campaign platform. Coming in second was Facebook with only 16% of respondents opting to choose an influencer with a Facebook audience. Lagging in third place was Snapchat which has suffered a decline in user growth and engagement on the platform in the last 18 months largely due to strong competition from Instagram and Facebook.
What’s In It For The Influencers?
The majority of micro-influencers are still happy to promote a brand just by being offered free product. Only 41% of the brands surveyed reported that they pay their influencers either infrequently or on a retainer basis while a similar percentage reported that they never, or rarely, pay their influencers monetarily.
The reluctance to reward micro-influencers for their contribution to return-on-investment (ROI) may appear as exploitative, considering that the Launchmetrics study suggests that 80% of the influencers surveyed reported that sponsored content was their main source of income, as opposed to ads and affiliate links. Furthermore, only one third of brands sign contracts with influencers. 2018 may see further increases in influencer marketing budgets as influencers begin to recognize their worth to brands and strive to take advantage of their position of power.
” The maturity of this growing market is quite low, which is crazy, because the sums of money we’re talking about can be quite huge,” – Michael Jaïs, Launchmetrics’ chief executive.
And this, in spite of the fact that influencer marketing models are relatively new to the marketing world.
The Decline Of The Mega-Influencer
As mega-influencers expect to work with brands that will offer them five-figure contracts, and two-thirds of brands are unwilling to sign contracts, it seems inevitable that there will be a further shift in favour of collaborating with micro-influencers.
Additionally there is growing skepticism around phenomenally high follower-counts with sources suggesting that some may be artificially inflated. Consequently, while numbers of followers may be high, rates of engagement with the promoted products may not reflect this.
Mega-influencers may see their opportunities narrowing if their following-size falls into the wrong bracket. Only 9% of brands are now opting to work with influencers with a following size of between 501,000 and 1.5 million, even though ‘celebrity-influencers’ are now only the preferred choice for 11% of brands.
When it comes to brands contemplating how to distribute their marketing budget, it would seem that bigger is not always better when sourcing an influencer to collaborate with. Whilst billions of dollars get poured into social media marketing through influencer sponsorship, it shouldn’t be assumed that this is all reaching the pockets of the mega-influencers or celebrity bloggers – good news for the micro-influencers.