Multinational brands are planning to increase influencer marketing spending in the next 12 months, with 65% aiming to spend more. This is in a bid to boost brand awareness (86%), reach targeted or new audiences (74%) and improve brand advocacy (69%), according to new research from the World Federation of Advertisers (WFA).
The research aims to offer a benchmark for the current state of influencer marketing, and the degree to which big brands have policies and processes in place to manage these new channels.
Despite their willingness to invest more in this space, marketers will only do so where standards on transparency are met. Majority of respondents (96%) cited quality of followers as "absolutely essential" or "very important" by multinational brands. Meanwhile, credibility (93%) and reputation of the influencer (93%) are also critical for the vast majority.
Transparency concerns among marketers also cover the way the relationship between the brand and influencer is declared to consumers.
About 71% of brands say the way the relationship is disclosed to consumers is "absolutely essential" or a "very important" part of the influencer selection process. The brand-influencer relationship is usually announced through hashtags (68%), descriptions in the post/video (63%), a verbal mention (50%) and paid partnership labels (43%).
When engaging an influencer, the main KPIs used by multinational brands to assess influencer activity are reach and views (96%), engagement (80%), traffic generated (44%), other earned media (44%) and research into audience sentiment (40%). There has also been an evolution of payment models for influencer marketing, with the two most used being a flat fee per post/video (66%) or offering free products/services for posts (62%). Other models being used include no payment but free products to test (25%), a fee based on performance (12%) or free products where performance warrants (11%).
Although spending on influencer marketing is expected to increase over the next 12 months, the brands surveyed still have concerns about the risks involved in influencer management. The four key areas that are cited as "very concerning" and "concerning" are consumer trust and blurred lines (64%), reputational risks (64%), legal and financial risks (60%) and brand safety risks (59%).
All the respondents surveyed use Instagram, followed by Facebook (85%), YouTube (67%) and Snapchat (44%). Only 33% of respondents use Twitter, while 19% use WeChat and Pinterest.
WFA added that it will work with members such as Unilever to use the research as the starting point for the creation of best practice guidance, to ensure that brands of all sizes are able to make the most of the influencer space. Last month, Unilever revealed it will not work with influencers who buy followers. Unilever also said that its brands will “never buy followers”, and that it will also prioritise partners that increase transparency and help eradicate bad practices throughout the whole ecosystem.
CEO of WFA, Stephan Loerke, said while influencer marketing is becoming a key channel for many marketers, it will only be effective if consumers can trust the influencers by declaring paid relationships and marketers can trust that they are reaching real people not bots. "This area has evolved rapidly and this research provides a benchmark revealing how marketing teams and their external partners are managing the new channel,” he added.
"This research demonstrates that many across the industry share our concerns. Unilever values the relationships we have with influencers, but we have made it clear we will only work with those who don’t buy followers so we can be confident we are reaching engaged audiences through strong partnerships,” Unilever's chief marketing and communications officer, Keith Weed, said.
WFA's research surveyed 34 companies representing 15 categories and approximately US$59 billion in global media and marketing spending. All respondents use influencers to market their products online, with 54% doing so "only occasionally/in some markets" and 46% using them "very often".
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