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The rise of the influencer

The rise of the influencer

Much like social media, influencer marketing was once disregarded as a gimmick. Today, influencers are changing the way that companies communicate with potential and existing clients. In a world that is increasingly dominated by digital activities, the impact of influencer marketing is becoming harder to ignore.

HolaSoyGerman is the YouTube Channel of Germán Alejandro Garmendia Aranis, a 27-year-old Chilean. He is a comedian, musician, and singer – and his channel has more than 30 million subscribers, making him the second most popular YouTuber in the world. His other YouTube channel ranks a mere 16th, with more than 17 million subscribers – or roughly the population of his native Chile.

The world’s number one YouTuber is PewDiePie, a Swede who has an extraordinary 53 million subscribers for his English language channel. If you are over 35, you may actually have heard of PewDiePie (real name Felix Kjellberg) because he was recently dropped by Disney (he worked with Maker Studios, a subsidiary company) over a series of offensive jokes he made (Kjellberg claimed he had been misconstrued).

Both HolaSoyGerman and PewDiePie are very high-profile examples of what are known as influencers. These are effectively self-made celebrities who have used platforms like YouTube, Twitter, and Instagram to build the kind of followings that many traditional celebrities can only dream of. Indeed, it is notable that Justin Bieber is the highest-ranking ‘real’ celebrity on YouTube. He sits at number three and has roughly half as many subscribers as PewDiePie.

THE FUTURE OF ADVERTISING

You might think that YouTube stars, no matter how popular, have little or nothing to do with the world of business. But a lot of people are starting to wonder if these influencers could be the future of advertising. Big brands such as Gap and Apple are starting to see influencer marketing as an important part of their advertising strategy. Influencers, some are whispering, might be the next big thing – like social media was back in 2009.

Nic Yeeles, co-founder and CEO of Peg.co, a business that connects YouTube stars and brands, says: “VidCon is the biggest conference for this space. When I started going a few years back, it was mostly YouTube stars who were speaking. Now you see a lot of big players from traditional media businesses. The world is waking up to influencers.”

This is interesting because, while the Internet has savaged newspapers, it has not had as great a negative effect on television as many people thought it would. The US media commentator Michael Wolff went as far as to write a book called ‘Why Television Is the New Television’, which declared that “the closer the new media future gets, the further victory appears”. But maybe now things are starting to turn, says Yeeles: “Ultimately, TV is funded by advertisers and the advertising world is waking up to the fact that influencers deliver more views and a bigger return on investment. The TV industry is trying very hard to get into this space.”

REACHING MAINSTREAM PROMINENCE

If there was a moment the world first realised that influencers might be more than kids playing around on YouTube, it was when Zoella landed a book deal. Zoella (real name Zoe Sugg) is a British beauty blogger who shot to mainstream prominence in 2014, when she signed a book deal for a reported advance of GBP 100,000 with Simon & Schuster. The novel, imaginatively entitled ‘Girl Online’, was the fastest-selling book of 2014 in the UK, despite being ghostwritten – a testament to this particular influencer’s influence.

Interestingly, Zoella did not need the money. For her, the advance, beyond the dreams of most first-time novelists, was a drop in the ocean. In 2016, she told the Sunday Times that, working with brands like Asos and WHSmith, she was earning GBP 50,000 a month. For those of us who grew up on a few TV channels and newspapers, Zoella seems shockingly banal. In one video, she spends 21 minutes removing items from a shopping bag – and that is pretty much all she does.

However, the enduring appeal of influencers like Zoella says a lot about how millennials and Generation Z consume media. They love influencers and, crucially, they trust them – and consumer brands and advertisers are noticing just how powerful influencers’ hold over their future customers has become.

Moreover, when it comes to the digital sphere, this is a well-documented process that happened with both the Internet and social media. The first people to colonise a new area are the geeks. Then come the kids who love anything new. Next, consumer brands start to take notice because the new area is cool and stylish and filling up with their customers. Finally, what might be termed serious, grown-up businesses start to see that these changes affect the way they communicate too.

Yeeles points out three reasons for the rise of the influencer. The first is the decline in traditional media. The second is that people do not trust advertising any more, and the third is the explosion in ad-blockers on devices. “The last one is probably the most important.” The question, he says, becomes how do you reach people, “and influencers are the answer to all this”.

A HUGE GROWTH MARKET

Harry Hugo, co-founder of the Goat Agency, an influencer marketing company, explains: “It’s a huge growth market and people can see this – but they go all in without thinking and it’s a very fickle world.” The trick, he says, is to identify people who are very well known in their communities and hold sway there. “If we were doing a football campaign, we might look through dozens of fan communities and find the top five people.” Similarly, he adds: “We worked with Apple for the grime artist Skepta’s live gig. We had to find the influential members of the grime community.”

A more straightforward business case is that of HP, which asked Yeeles’ company to find people who were making videos about using AutoCAD drafting software. Members of the public would be unlikely to have any idea who these influencers are (or that this community even exists), but in AutoCAD-using circles they are important people whose voices are listened to.

Having identified influencers, the companies with something to sell then ‘collaborate’ with them. This is often something of a delicate balance. If you have an influencer suddenly aggressively pushing a brand, it does not work because they sound like a paid shill. Instead, the influencers will usually be paid to post or make videos using the product or service. An obvious example might be a food vlogger using a particular brand of sauce to cook with.

A TARGETED APPROACH

Unlike more traditional ways of advertising, which are scattershot, influencers get straight to the consumers you want to reach. The return on investment is better for this reason, and because consumers trust the influencers and do not filter them out. As for the idea that the influencers themselves might be selling their soul, the line they take tends to be that they only work with brands they believe in.

People tend to be coy about rates influencers are paid. But what we can say is that they vary enormously. For someone with 5,000 followers in a fairly niche community you might pay GBP 20 a tweet. You could just give them merchandise as payment in kind. For a big star, you might pay something like GBP 50,000 for a video post. The very best-paid influencers can make GBP 25,000 a day.

Although influencers feel exciting and new, in some ways they are just the oldest form of marketing re-imagined for the digital age. Mark Borkowski, a PR consultant, notes: “It’s quite an old-fashioned word. It’s the power of word of mouth.” However, Borkowski adds, what is new is the power of niches: “Social media has made these much more valuable.”

The relationship companies have with influencers is not as straightforward as traditional marketing relationships, though. The company does not control the influencer in the way that it might control a TV advertising campaign. To take an obvious example, an influencer might put your post up on Instagram but then, shortly afterwards, might post something else rather off-message because it’s their channel, not yours.

On the one hand, the problem of influencers going rogue is just a modern twist on a high-profile spokesman saying something outrageous. But on the other, it is different. The relationship with the influencer is far looser – it’s a collaboration. Indeed, the influencers may well have got where they are by saying outrageous things and by not being bound by traditional media norms.

Therefore, the expectations that you as a brand have should not be the same. You are paying them to be who they are and you do not have much comeback if you subsequently discover that they are not who you thought they were. The trouble is, many traditional companies pay for an influencer and then expect a compliant celebrity who stays permanently on-message.

A BRAVE NEW WORLD

This brave new world can be a very frightening place for brands. “The influencers on social media exist as a portal into a world that businesses feel they should be in but don’t really understand,” says Phillip Graves, the author of ‘Consumer.Ology’. “It’s a minefield for many of these companies and sitting behind the desire to make inroads into this place there is often a desperation of sorts.”

What, then, can businesses do? Rather than engaging influencers to sell for them, they can simply pay attention to them. Influencers also have strong predictive power and, by looking at what they are doing, businesses can engage in trend forecasting. If you are, say, working in food and you notice that food vloggers are posting heavily about recipes involving pistachio nuts, you might reasonably conclude that, six months down the line, their influence would have filtered through to the mass market and pistachio nuts will be a very popular ingredient.

When it comes to business influencers, they tend to be most prevalent in areas like software and technology. However, an interesting area where we are starting to see the growth of influencing professionals is law. There are now lawyers on social media who have considerable followings. One notable example is David Allen Green, who blogs and tweets – and was one of the first people to identify the importance of Article 50 in the UK’s Brexit process. As a result of being what he jokingly refers to as “the Article 50 hipster”, Green now has a pretty impressive Twitter following and writes for the Financial Times.

It is also worth noting that brands can become influencers themselves. Companies ranging from Taco Bell to the UK florist Arena Flowers are celebrated for their witty Twitter feeds, which give them an audience far bigger than they might normally have. Similarly, you often see small businesses build huge social media followings. “If you are a niche fashion boutique,” says Borkowski, “it can be very, very effective.”

INFLUENCERS EVERYWHERE

However, just because social media influencers are enjoying a moment in the sun, we should not let this blind us to the other influencers who are offline or wield influence in more traditional ways. The person who has written a book that every CEO reads is an influencer. The man who presidents consult about policy is an influencer. “Some influencers are not easily found,” says Borkowski. “They may work in salons and in private networks.” Moreover, he adds, a number of influencers have feet in several different camps.

All this uncertainty about influencers points to the Age of the Influencer still being very young – perhaps where social media marketing was back in, say, 2011. Over the coming years, says Yeeles, “Influencer marketing will become a standard form of marketing and will no longer be seen as a gimmick. Like social media, it will be viewed as a serious business.” He adds that one sign of this is that both the influencers and their audiences are growing up, literally. Whereas once they were all in their teens, now they are in their 20s and even early 30s.

Moreover, the videos that influencers make are finding an older audience. “My mum has no idea what I do, but my dad totally gets it,” explains Yeeles. The reason? He got into woodwork and the place he learnt about it was YouTube, via videos posted by a carpentry influencer.

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