During my recent trip to Toronto, I had the chance to participate in a couple of events organized by the good folks from Buffer Festival. I met a lot of smart creators who work with brands on a daily basis. They create awesome content for these brands, but are dealing with an ever-growing challenge of bridging the gap from storytelling to finding out how their work impacted brands’ goals.
We also discussed current influencer marketing trends, problems, and future perspectives. Almost all of our discussions ended on the same note: influencer marketing has great potential and is already living up to some of it, but there is a bigger opportunity on the horizon. That opportunity involves shifting huge TV and programmatic ad budgets over to influencer-based marketing; maturing from experimental marketing to a core part of a brand’s marketing mix.
Everyone who I talked to agrees that our industry’s biggest problem is standardized measurement. It’s a problem for brands who need to justify their investments with verified data, but it’s also rapidly becoming a problem for creators, who find it difficult to secure more mutually beneficial long-term brand deals.
When Third-Party Measurement Is Established, Brand Investments Follow
I’ve been reading that we can expect an uptick of branded posts in the coming years. Some figures show that their number will be close to $35 million by the end of 2019. In fact, the influencer ad market is now worth $1 billion and, with projected increase in posts, that number will only grow.
That sounds like a lot, right?
To put that into context, brands are spending around $71 billion on TV ads and around $83 billion on digital advertising per year (2016 was the first year in which digital surpassed TV). In addition to that, the video marketing industry is expected to break $135 billion in the US alone this year. That’s a total of $289 billion dollars being spent on three different (and broad) marketing channels. Projected influencer marketing spend (those $1 billion) in 2017 is exactly 0.34 % of those astronomical budgets!
We can all agree that TV would not see that level of ad spend if Nielsen ratings (standardized measurement) didn’t allow marketers to effectively gauge what they are getting in return.
Now, imagine the same type of standardized measurement serving as a driving force for influencer marketing. Once marketers have the same degree of confidence in the ROI of influencer marketing, and can benchmark it against TV ads and programmatic (those video ads you see all over the web), it’s going to bring with it marketing budgets the creator community has never seen before. Just picture what the landscape would look like if 20-30% of TV ad budgets are reallocated and made available for creators? The industry would explode – more work for creators, better returns for brands, more incentives for platforms to further develop their features – and that’s just the beginning!
We have an opportunity to do just this. If we can offer actionable numbers to marketers, they will choose creators – not TV, not billboards, not programmatic – and there’s no doubt about that. They just need to see that their investment is working, in black and white, from an independent third party.
This is part one of a two-part series on how standardized measurement will help both creators and brands move the influencer marketing space forward. Stay tuned for part two which demonstrates why influencer marketing is a team sport.
Photo credit: Pixabay