With many newly introduced privacy regulations and requirements governing personal data in Europe and the US (and likely in other parts of the world soon), programmatic advertising is increasingly challenged. Processes like behavioral targeting and retargeting with granular user segmentation and unrestricted use of third-party data is no longer possible – unless explicit user consent is given.
The situation has prompted advertisers to steadily shift towards new, more direct ways of reaching their audiences – methods that don’t involve the use of third-party cookies and minimize the need for consent collection. This explains an increasing interest in social media marketing – Facebook, Instagram and Snapchat and, by extension, influencer marketing.
Why Influencer Marketing Matters
Influencers are currently one of the fastest-growing marketing channels. According to MarketingHub, as many as 86% of marketers are dedicating part of their budget to influencer marketing in 2019. At the same time, 80% consider influencer marketing effective.
Advertising products through celebrities is on the decline – we’ve written about the evolution of influencer marketing in another post on our blog. Working with long-tail, niche influencers is becoming increasingly popular and carries undeniable benefits. It offers extremely precise targeting and drives high-quality traffic to your website. According to a Mediakix study, 71% of the surveyed marketers considered traffic from social media influencers superior to other traffic sources. At the same time, influencer marketing was found to offer better ROI than other channels. Influencer campaigns are modern-day word-of-mouth marketing, and it is proven that 92% of people trust recommendations from individuals – even if they don’t know them – over brands.
While influencer marketing is in its heyday, it is also becoming more fragmented and complex. The success of a campaign is contingent on finding the person most relevant to your niche. This necessitates the use of proper tools to support brands in discovering and managing influencers, and evaluating the results of campaigns.
What Is an Influencer Marketing Platform?
An influencer marketing platform (aka influencer marketing marketplace) is a platform to discover influencers for a specific campaign and connect with, hire and pay them from a single place. This is an invaluable tool for brands wanting to manage multiple influencers within a single campaign. The platform automates some processes associated with managing influencers working on a campaign.
There are dozens of influencer marketing platforms and the most popular include TapInfluence, AspireIQ, FameBit, Heartbeat and Grapevine. However, many of them share the same growing pains and universal problems. This only shows that there is still space for improvement.
The Challenges of Influencer Marketing Platforms
There is no “one size fits all” platform. Many platforms focus on specific social media channels and offer unique features, but it’s difficult to find one that manages all channels equally well. Similarly, some platforms require an opt-in from influencers, while others proactively reach out to them. Also, while each platform offers a database of influencers, only a combination of a few platforms can give a full view of the influencer marketing market, which can ramp up the total fees.
Difficulty reaching big-name influencers. Some of the most successful industry experts, YouTubers, or bloggers (i.e. so-called macro- and mega-influencers like Gary Vee, Oleg Vishnepolsky or Tim Ferriss) may not even be found through the search engine of a platform. Instead, they are often accessed through talent managers.
No human touch. While platforms offer the benefit of automation for marketers, they often (but not always!) lack proper mechanisms for ensuring the content produced by influencers meets certain standards and is safe for the brand. No matter how advanced a platform, human labor is still indispensable in many ways.
Problems finding good fits. Even with these platforms making it much easier, it is still hard for some marketers to identify the best influencers for specific campaigns. The challenge is confirmed by 61% of marketers.
Many of the growing pains of influencer marketing platforms stem from the fact that this technology is relatively new and still evolving.
What Are the Key Features of an Influencer Marketing Platform?
Most influencer marketing platforms share a number of key, essential features, but many leading platforms are trying to differentiate by offering something unique. Let’s do a quick rundown of the most important features an influencer platform should offer.
1. Search and Discovery Engine
Popular vloggers and bloggers come in all shapes and sizes, from game streamers, mobile phone reviewers, makeup vloggers, fitness gurus, expert foodies, etc. The leading platforms offer big databases of influencers – Upfluence alone boasts a whopping 2.7 million profiles. There really is a niche for almost every conceivable product out there, but the challenge is to know which influencer to pick for a campaign.
Platforms like Grapevine or TAKUMI offer access to their network of human-vetted influencers, which gives marketers additional quality assurance beyond numbers in the analytics panel. The payoff, naturally, is the size of the database.
A search and discovery engine is one of the core functionalities of an influencer marketing platform and helps marketers find the most relevant influencers for their product. This typically involves a searchable database of potential influencers and automated suggestions for the most relevant people in a specific campaign.
Searches are based on criteria that characterize both the influencer and their audience. There may be filters for various pieces of information from the influencers’ profiles like performance metrics, rating, historical engagement, post frequency, recommended price, audience overview and demographics.
The results page should provide contact information for each influencer, allowing brands to communicate with them directly, negotiate the deal and hire them for a specific campaign. Some platforms offer draft contracts and handling of various regulatory compliance matters. More on that later.
2. Contact and Relationship Management
An influencer marketing platform should automate all the tedious tasks like messaging influencers, signing contracts, price negotiations, and payments – and support the marketer in keeping track of the relationship.
Automated invitation emails (with email templates to choose from) streamline the process of establishing collaboration with an influencer. Some platforms come with customized email drip campaigns, improving their response rate.
When a relationship with an influencer has been established, a marketing platform works much like a CRM. It groups every relationship automatically by stage, and guides the marketer through the subsequent stages.
Brands that run campaigns with many influencers will benefit from features like custom groups, tracking contract signatures, mass-messaging and sending automated reminders and messages based on rules.
3. Integration With Channels
While some influencer marketing platforms focus only on a single social media platform, a majority of them integrate with a number of different channels for broader influencer outreach.
An influencer marketing platform should offer seamless integration with various social media platforms through their APIs and SDKs. This allows the platform programmatic access, custom audiences, and reports. With automation of activities connected with the promotion of the content, brands can reinforce the impact generated with influencer content.
On top of social media, the influencer marketing platform can offer non-social or offline channels. Upfluence, for example, has a discovery engine that also includes blogs. Some marketplaces specialize in particular areas of the market (beauty, sports, entertainment, tech, etc.), whereas others have a wider positioning.
4. Campaign Content Management
Features like campaign content management allow users to manage ad text and graphic creatives, hashtags, mentions, campaign duration, deadlines, giveaways and sweepstakes, and other ad campaign features for multiple brands and influencers.
Through the platform, brands can receive creative content from influencers and preview, accept, negotiate or reject it accordingly. Conversely, influencers can receive various assets: images, videos or copy they can use in the campaign.
5. Influencer Compensation
Campaigns typically utilize the cost-per mille (CPM) pricing model, whereby a certain amount is paid for every 1,000 views of an ad. Alternatively, campaigns like affiliate marketing campaigns operate on a cost-per acquisition (CPA) model. Other pricing models include cost-per click (CPC) and a set cost for the campaign.
How much money influencers actually make depends on multiple factors, such as a particular social media platform, follower size, engagement rate, and their audience’s demographic. An influencer marketing platform should also have features in place that allow brands to manage payments to multiple influencers form one place.
Additional features could include escrow payments (a money deposit taken from the brand to pay influencers, but only once the job is done), tax compliance (e.g. varying VAT and other tax rates for international collaborations), and integration of payment systems like PayPal, Google Pay, Apple Pay, or credit card payment gateways.
6. Analytics and Reporting
A good influencer marketing platform should allow brands to analyze the actual impact that an influencer’s ad campaign has created for the product or service and calculate the return on investment (ROI) for the whole campaign.
Such reporting capabilities are not much different from onsite analytics offered by platforms like Google Analytics. They track information like publication confirmation (whether the sponsored content was published), views, reach, engagement, ROI, real-time analytics, and URL tracking through affiliate links.
To more precisely measure the above statistics, some platforms utilize their own custom tracking pixels or shortened affiliate links that influencers can put on their blog when promoting a product.
Should You Build or Rent an Influencer Marketing Platform?
The dilemma of whether to rent or build an influencer marketing platform involves the same considerations as in the case of other MarTech and AdTech platforms. Careful weighing of advantages and disadvantages would allow you to make the decision.
By building your own influencer marketing platform, you gain a number of competitive advantages. We’ll list some of them to give you a fuller picture:
- Save money on fees and commissions. Having your own platform allows you to stop paying regular commissions and fees to third-party platform operators. By operating a platform, you can run an unlimited number of campaigns with zero fees on top of the development cost.
- Control the feature roadmap. You make decisions regarding the feature roadmap and choose functionalities that better fit your business goals. By building a custom platform, you can avoid third-party platforms that only partially meet your needs and offer a number of features that your business will not benefit from.
- Generate more revenue. By developing an influencer marketing platform, you can create a new revenue stream, and can also integrate it with your existing products to offer multi-channel campaigns, drive more revenue to your company and increase your company’s overall market value.
By renting the platform, on the other hand, you can:
- Avoid the development cost. Influencer marketing platforms charge fees, but the cost is still much lower than the development of your own platform or agency fees.
- Test influencer marketing cheaply. Using a platform allows a brand to experiment with influencer marketing and see how effective it is for their campaign management before spending big bucks on development of a full platform.
Influencer marketing is an interesting proposition for brands, especially with regard to programmatic advertising being increasingly challenged by privacy regulations, ad-blocking software and other phenomena like banner blindness. This evolving form of marketing is on its way to become a bona-fide channel, and has already proven to work for all companies regardless of their size.
The benefits behind influencer marketing for brands – granular targeting with very high conversion rates and decent ROI – motivate marketers to allocate increasingly big budgets for campaigns, but the growing confidence in influencers also creates vast opportunities for companies looking to build their own influencer marketing platforms.