Not getting the ROI you want from your influencer marketing activity? Take a note from the affiliate playbook. In this session, hear from leaders in influencer marketing on how to drive meaningful outcomes from campaigns and the trends you should know.
What your influencer program can learn from partnership marketing
Hi everybody. Thank you for joining us and welcome to the next session for the Global Partnership Day and we will speak today about your influencer program and how you can learn from partnership marketing.
And today we will speak about measurement, performance models, and success in the channel, and the lessons learned. My name is Saskia Keller and I'm a customer success manager at Partnerize.
I joined Partnerize last year and in my previous roles I also have been working in the influencer channel. I'm very excited to host this panel today.
I'm delighted to be joined actually by the two panelists who are responsible for driving the success in the influencer channel. They both worked for amazing leading brands in this region and globally.
And with that in mind, I would like to introduce you to our panelists, starting with Valeria Bondar. And for the past few years, Valeria has been looking after the affiliate and partnership channels at FARFETCH for greater China.
And her key focus and her role is leveraging the power of influencer compensation, partnerships, tech innovation and to support a company business goals in the region for China.
Hello. Thank you for the intro.
And we are also joined by Annabel Gray, who is associate director in Australia at Silverbean, and Silverbean is a service agency specializing in affiliate and partnership channel and they launched the APAC region only two years ago, but already made a huge difference across landscape with our value based approach for partnerships.
Thank you. Thanks for inviting to me to be part of it. Looking forward to it.
Yeah, so thank you as well and very excited to start this discussion. So let's kick off with the first question actually. So Annabel, there's so much hype about influencer marketing, but for some affiliate marketing it's still actually navigating in this channel.
So what do you actually think that opportunity is here?
Well, I think there's a huge opportunity and I think for performance marketers that don't get involved, it represents a huge missed opportunity. I'll put some numbers to it.
So most recent figures have forecast the influencer industry globally to be worth around about 13 billion Aussie dollars. And to put some context in terms of the growth, it was estimated it was worth just 2.2 billion in 2016.
So that's growth of nearly 500% in less than five years, which is pretty incredible and it's not showing any signs of stopping. Those forecasts have estimated by the end of 2021, it's going to be worth around about 18 billion dollars the end of this year, so that's another 40% growth this year alone.
So it's something that performance marketers really do need to be involved with. So while are we seeing this huge growth in the channel? It's a core channel for digital marketers and as the channel is maturing, it's becoming increasingly important.
So despite all the murkiness which is associated with influencers, at its core, influencer marketing is referral marketing. So we all know the power of referral marketing, it's why we're in partnerships.
People trust people. If you see someone that you admire or you aspire towards and they're endorsing or they're using a product which genuinely aligns with their values and it's one of the reasons that you really respect this person, it's a very powerful and effective message.
This person who's just like me uses this toothbrush, perhaps I should try that toothbrush and then my teeth will look like this or whatever it is. It's a great and effective way to get your message across to the right audience.
However, in its current format, it's still a relatively new channel and as such it's a space which has been constantly disruptive. I mentioned the murkiness within the channel earlier, so we're all aware of the potential for fraud within this for bought influencer or bought followers and bought likes, which can make it really challenging or daunting for new brands to enter the market and also to trust the returns that they're getting off the back of it.
We're also seeing disruption from platforms. So Instagram just recently rolled out the removal or they offered the removal of likes from their platform on a global level, which then quite coincidentally timed with their announcement of their own affiliate platform, which they're building in-house, in-platform, which allows content creators to monetize on a performance basis.
In addition to platform disruptions who are also seeing the emergence of new platforms such as TikTok, probably not a new platform anymore, but still relatively new to the space which provides the opportunity to engage with new demographics.
So yeah sure it's a huge opportunity, but in order for performance marketers to take true use of it, there needs to be a lot greater transparency with it and understanding of how to use it effectively.
Thanks for that. Those are amazing numbers actually that are estimated for this channel. Great to hear. Actually talking about numbers and maybe that's a nice bridge to our first topic, measurement and the management of the channel actually.
So talking about numbers, Valeria, how do you actually set measurements for FARFETCH and benchmarks for influencers as a part of your wider program?
So we actually work with influencers as part of our performance marketing activity and within Greater China, it's also part of the affiliate channel for us.
Obviously, we cannot work with influencers in absolutely the same way that we work with other types of affiliates such as agencies, cash back, shopping aggregators, but still we are benchmarking our activity against other channels.
We are also benchmarking our activity against other types of affiliates just to see how the influencer piece fits in the overall strategy and how it works with other channels, what works, what doesn't work, and how we can improve and optimize that.
So it's really hard to compare influencer marketing to affiliate marketing in a way because we are dealing with a slightly different approach in terms of management, in terms of communication, but as I mentioned for us there's really not much of a choice if we decide to manage it as a part of our performance campaigns.
So I guess that the key here is to have the reliable technology, first of all to measure and to compare and to benchmark, but also be flexible around how you work with influencers, how you compensate them and how they stack against other channels in your channel mix what kind of value they deliver besides conversion, besides engagement, besides traffic, and just see how they work together.
Nice, thanks for that insights and Annabel, one of the benefits of course for managing influencers through technology is that you have a lot of data available and that you have access to all those insights.
How are you using that to help navigate to the approach and making real informed decisions?
Yeah, so from my perspective, one of the big changes from influencer as a branding channel into the performance arena is really that use of data and how you can use data to optimize your campaign performance.
Because using those metrics, given it greater accountability, does really transform it to much more of a performance-orientated outcome. In terms of using data, it's key across all stages of your influencer activity.
So from the discovery piece, the influencer success depends on working with the right partners. So using data to delve into who you are working with, get into the influencer demographics, just don't take metrics at face value but really delve into them and understand who their audience are, where they're based, how does that align with who you are talking to.
For example, if you are an Australian-based retailer and you don't ship internationally, it may not be a good fit to work with an influencer who's Australian, but the majority of their audience are based in the US because it's not going to be that effective.
Aligning with influencers who have an authentic connection to your brand is really important. So you can use a few insights in this to work out what are the values that these influencers represent, what are the sort of hashtags which they've been using frequently, what are the other sort of brands that have strong affinity towards to help you really build up quite a robust understanding of who these potential partners are and what the potential fit for them could be.
Then in terms of next steps, it's looking at your expectations for success. So as Valerie mentioned this, you can't have exactly the same metrics translated across from your affiliate channel because this is enough of activity.
So at Silverbean when we are looking at influencer success, we broadly categorize it into three key areas. So we look at the content which has being generated, the level of awareness or reach which are getting from the back of it, and then also the performance and conversion side of things.
We then look at influencers based in terms of the size of the influencer and then you can align those expectations based on influencer size. So for example, your macro influencers for example, may perform a lot stronger in the content generation and the awareness aspects as opposed to the performance side.
So they'd be more geared towards success metrics for those would be more geared towards those two metrics, whereas your micro-influencers or your friends and family influencers will be a lot more higher engagement and a lot stronger performance.
So you'll see a lower CPA with those. Looking at them holistically helps you create sort of blended metrics across the channel as a whole on where it needs to get to be structured for success, but you can drill into those individual level.
Finally, then using it when campaigns live is measure everything. So building up some really robust understanding of what works in an individual influencer level.
We track everything from post type, time of day, day of week, number of posts, what was the content that went out, et cetera. So you have some really strong data and on each of the individual posts on how well they performed, what was the engagement or the conversions that you got off the back of it and then that can guide your optimizations moving forward.
I would on that side though, I would issue a word of caution to not get too attached to everything that the data is telling you because these are all individual influencers who will know and understand what works best with their audience.
So if the influencer is saying actually you believe that Tuesday is the best day of week for you to post, but they say they have strong engagement with their audience on a Wednesday, test it and see what happens and then you can revise and repeat and optimize your campaigns moving forward from there.
Nice, thanks for that. So actually I hear you talking about individual needs for influencers and three key areas on content awareness and performance actually, and actually, I also have been hearing a lot about right approach and you actually, are you working on pure performance or a hybrid model when rewarding influencers?
And actually, that brings me a bit on to the next topic and maybe Valeria, can you tell a bit more on how you are working with influencers?
How do you approach all those different influencers?
Well, as a platform, as a service provider, we are promoting the products but also first and foremost we are promoting for our FARFETCH as a service, as a platform.
So that obviously impacts our selection of influencers as well as the way we approach working with them.
As an overall framework, we have a CRM approach applied, so we categorized segment and adapt to each segment based on their needs.
I totally agree with what Annabel mentioned around the types of influencers. I guess it's a common knowledge that there's an influencer pyramid and within that you have top influencers who might not be that many in count but I guess would be driving the bulk of business for you in terms of traffic and conversion.
The mid-tier ones and the lower-tier ones, and this is our main framework for working with them, each of these tiers have different needs.
They also bring different value to the table. So with top influencers, for instance in China we work with a lot of macro influencers on WeChat and on WeChat getting something like a million followers three times harder than it is on any other channel on Instagram and Weibo on TikTok, it is a very hard channel to have fun engagement on and to gain followers.
So these influencers who already passed that sort of threshold of 500,000 let's say, they have a very different set of needs and very different set of requirements towards the brand partners that they select to work with.
So they are selecting us as well as we are selecting them. And what we did last year, we developed a new technology, sorry, the year before that we're in 2021 now, and we developed a new technology on WeChat that allows them to basically open their own WeChat store on a WeChat mini program bases and to create that store fully using FARFETCH products and FARFETCH technology in the backlog.
So this allowed them to actually have a much better data transparency. This allowed them to be the host of their own stores and to basically run an online store without with zero investment from their side.
So everything was powered by us, by FARFETCH. We at the same time are also gaining data insights from that. So it's always a win-win and I guess for me this is the main approach that you have to take with influence marketing.
Always think about what influencers may be gaining from your brand as well as what you may be gaining from them. So for mid-tier influencers, again they have a different set of needs.
A lot of them are really thriving and trying to get to that top one, the top level. So they would need some type of additional promotion on your side as a brand, perhaps giving them a lift to get to the top.
And this may also be used as a leverage managing your influencer campaign and how you negotiate compensations with influencers for instance.
And for the micro level and the KOC level, what we call them in China, the key opinion customers. So these may actually be the customers of your brand, they may be your employees, they may be friends and family, just pure referral network.
They have again a different set of needs and perhaps for them it's more of an honor, it's more of a learning curve to work with a bigger brand.
So you would probably need to invest a bit more educational resources to actually teach them how to leverage their reach, how to leverage their engagement into conversion, into the dollars in commission for instance.
So for you as a marketer, you obviously have to control the performance from top to the bottom. The costs are different, the performance metrics are different, the expectations are different, but they sort of stack against one another.
So without the top tier, your lower tier may might not be performing as well without the very solid middle tier. Your other channels might not be performing as well.
Display, paid search or CRM channels. So yeah, I guess here data is key and technology is key again and how you manage that, it will really reflect on the business results for sure.
Great, nice to hear. So actually we spoke now about marketing and some benchmark and performance models.
Very important of course is to see some success. So maybe Annabel, can you tell me a bit about how you are working with a test and learn approach?
Is that something that's possible or how brands can, for example, start? Can they start small and then scale up? What would be your advice there?
Yeah, absolutely. I think it's like all things digital marketing, you always need to have a test and learn approach. You always need to be challenging your assumptions and learning and growing your campaigns accordingly.
So to Valerie's point on the challenges faces on WeChat, like follower base versus Instagram. That's something that you're not going to know until you go into that channel and it demonstrates that you can't transfer your knowledge from one platform and be like," hey, this day works, this time works.
Let's just plunk this strategy across onto WeChat and then see if it works there" because it's not going to. You have, every time you change something within your strategy, you're going to have to test it and then you're going to have to retest it as your strategy progresses.
So with that in mind, because there's a lot of unknowns with, if this is new to you, I would always recommend to start small and scale up. It's a safer way to do it.
There's an unlimited number of influencers, more than likely. Maybe not unlimited, but there's a lot that you could work with. They all require management, they all require quite often budget.
There's a logistical admin element as that to work as well to get your stock out, make sure it's working so you don't want to over in something that's an unknown.
So absolutely start small and starting small is working out you as a brand, what are the values that you are portraying? What's most important to you?
What's going to be your strongest area for success? Is there a specific product range or category or message that you can use that you can tie into influencer category? Have you got a new range launching and you can have a clear campaign strategy built around that.
So you've got consistent messaging across all your key partners at the same time. Work with a small number of influencers to start off with. So generally as a starting point, we look at around about 10 and then they vary in size, so you're hitting all of the different parts of the funnel as Valeria had mentioned there.
Your big ones are mid tier and then some of your smaller ones as well to give that really strong distribution and then look at a range of hybrid different deals.
So it is possible to still do some contra deals, which are quite useful to bring down your overall, depending on the cost of your product as well, whether that's an area you want to go down.
Having contra deals is quite useful to lower the overall program CPA. However, we really recommend having more gear towards contractual agreements because it gives you much greater control as a brand in terms of what's going to be posted, when it's going to be posted.
You can also do brand approvals so you can make sure that it aligns with your brand guidelines before it goes live. And so if it's new to you, I'd recommend having that in place because it just adds that extra layer of safety to your campaign, to these ambassadors who are going to be sharing and representing your brand outside of your control.
Once you've got it up and running, then you've got some insights in terms of what influencers are the working, which ones aren't. I then recommend creating a few of those from your first campaign to actually becoming your ambassadors.
So the ones which would be most successful, you can then work with them consistently on an ongoing basis. So there's a consistent relationship between your brand and this ambassador who's representing you.
Great. Actually that you're just mentioning how to start with a setting up maybe an influencer channel and Valeria, do you have maybe advice for people who are looking to start this as well?
What kind of person can manage actually this channel? What kind of skills do you need for that?
We have a concept at FARFETCH that I really like, which is called growth mindset. And I would suggest applying that growth mindset to your influence campaign.
And first and foremost think even if you're starting small, even if you are a small brand and you have a small program, think a few steps ahead.
Just try and forecast how you would run it at a scale, what kind of basis, what kind of foundation you need to run it at a scale after a certain time because hopefully that will happen if everything is done right.
Automate as much as you can. Working with 20 influencers and 200 influencers is a different level of commitment I would say.
It's also a different amount of time that is consumed. So try and automate as much as you can. Give your influencers access to brand hubs, to information about your brand, to just simplify that learning curve for them.
Automate as much as you can in terms of technology, give them access to links, teach them how to create these links. I mean these are basic things, but a lot of the times when the foundation isn't done, the influencer program just stagnates at a certain threshold at a certain point and the marketer isn't able to scale it.
And also look at insights, provide those insights to your influencers, provide them with data. Teach them how to learn from that data, how to apply it to their performance moving forward because they themselves should be interested in what performs better with their fans, how to better engage with their fans, what kind of product their fans are looking for.
I'm sure that any type of good and reliable influencer would appreciate these insights from the brands, but also build that trust with influencer.
Whether it's, again, whether it's 20 or 500 influencers, make sure that they have a trustworthy image of your brand.
And it comes down to basics again, pay them on time, be committed to your contractual agreements. These are things that may seem very, very basic, but we see so many instances of contracts being broken and influencers being left miserable after certain collaborations with brands, unpaid, complaining on social media, which is an even bigger damage to the brand image because people read and people talk and that is one small industry that we're all in actually.
So yes, I would say that these are the biggest ones. And also just be very agile, be vigilant about the brand, the trends that are going on social media, the formats that are performing better for other brands.
Learn from the social media platforms, they're always changing. I mean take the example of Instagram again or the example of Weibo that, well they didn't announce it publicly, but they are doing this at the moment is sort of blocking all the third party tracking links on Weibo and trying to basically kill the affiliate marketing opportunity for influencers overall.
So yeah, just be prepared to, for this ever-changing, these ever-changing platforms and the changes that are about to come.
Talk to your tech team if you have one, if you don't, talk to your tech provider and see how you may be managing these risks in the future.
Great. So the base should be right, trust is very important and make sure that you're able to scale and make sure all the trends that are happening in the market.
Are there any other lessons or considerations or things that we should be aware about when we start with this channel?
I will jump in off the back of my last answer. I would say with all of the above, there's always risk is coming with the affiliate activity and the bigger your scale, your influencer program, the more risk you're actually taking.
Some influencers may not be performing, it's not always win-win, not always 100% a certainty around whether or not certain content, even if it looks bulletproof to you, it might not perform in the end with the fans.
So I would say yes, be very aware of the risk you're taking, try to minimize that risk where possible. And also just think beyond the standard definitions of influencer activity, influencer program and influencers themselves.
What we see in China is a lot of the times brands are using something that is called the KOC strategy and applying the same influencer principles to the groups of customers that you wouldn't even think could be influencers.
For instance, building partnerships with very unlikely audiences and gaining amazing results from that. The rise of social commerce in China and what many of the local brands have been embracing for the past year is just one proof of that look beyond and try to think about again what type of value, the influencer would be gaining from you as a brand.
The more authentic that connection is, the more there is affinity to your brand from the influencer that the better that content will perform, obviously.
But also try and get influencers to be the actual users, the actual customers of your service, of your product. We see so many paid reviews online that users and customers are very much aware of the fact that some of those are paid advertising and it might not be 100% authentic and stories crop up every now and again in China, about influencers advertising certain products on live streams, for instance, that sell out within seconds and then end up being a flop.
But yeah, just try and get your influencers to be the actual customers of your brand and learn from them, learn from their feedback. They are the cheapest, the best feedback that you can get, the most authentic one.
If they're not happy with your service, they will tell for sure. So yes, I think there is that value of authentic feedback from your influencer relationships for sure.
So it's a lot of things to take in consideration when approaching the influencer channel, nice. And Annabel, any advice that you have for partner marketers who want to incorporate influencers into their mix?
So building on a lot of other points, which Valerie has raised there and what we've talked discussed already. So starting small, don't try and overexert yourself, but approaching it with the growth mindset is if this is successful, then what do I need to do? What are all of the other areas which I need to have in place?
Considering, and we've said it a few times today, but the authenticity. So looking for those authentic connections with your partners or who you're going to work with and really defining as a brand what that looks like for you.
So then you can set those expectations when you're looking for your partners, and treating it as a partnership. So to Valerie's point, it's like it is a partnership.
You are partnering with these influencers to represent your brand, but this is their living, this is what they do for a living. So make sure that they're being fairly awarded for the work that they're doing, paying them on time.
Negotiation obviously exists, but bearing in mind that there's still like an area where this is someone's living, and if you want them to be genuinely like representative of the brand, what is a fair value for them to be paid for that effort and for them to be an ongoing ambassador.
Considering all your logistical side of things and then creating realistic timelines off the back of that. It's not a switch that you can just flick on and be like, right, let's get all our influencers alive.
It takes time, it takes time to find the right partners for you and to negotiate what that's going to look like to come to a contractual arrangement. You then got all the stock which you need to dispatch for them.
They then need to be able to use it and record it and whatever that may look like. Some products have a longer lead time if for influencers to be able to actually use the product.
So factoring that into your schedule as well. And then reviewing everything as you're going. So working closely with your partners, listening to the feedback that you're getting from them.
If they're saying," Hey, we're finding this really restrictive, have you thought of doing this?" Bear in mind they are the experts when it comes to their audiences. So you represent the brand, you're the brand expert, but they're the expert with their audience.
So listen to them, it's a two way dialogue. If they're recommending something, give it a go, see what happens. And you may be surprised, but approaching it with an open mind and being prepared to, I'm going to say pivot and try different things is always valuable.
Nice. Well that brings us almost to the end of the session actually, but I have one more question actually. And we actually have seen influencer marketing changing already so much over the last five years.
And with that in mind, what do you think is going to be the next stage of influencer marketing?
Yeah, I'll jump in. So I shared the figures earlier in terms of the massive growth, which we're seeing in the channel already. And it's, as I said, it's estimated number, 40% growth for this year alone.
So I don't think we're going to see that change anymore. I think we're also going to see the COVID effect. So more people have been driven online and more people who perhaps weren't as familiar with the internet and with these channels are going to be using the internet in ways that they've never done before.
So one of the byproducts is that is we're going to see an increased fragmentation of the marketplace. So we'll see a rise of different technologies or different platforms which cater to more niche audiences.
So TikTok is a platform which has just flown and it's emerged and that caters more geared towards Gen Z, but I think it's sort of like the next iteration of platforms. We'll see them getting a lot more targeted in that.
So we may see ones, for example, which are targeted just at the beauty space with technology and platforms enhancements, which are geared to support that and influencers on those platforms within those spaces operating within a very, very targeted area.
So I think we'll see a lot more fragmentation, more people online, we're going to see a lot more of the smaller scale influencers. So those key opinion customers, it's a great strategy to really embrace someone who knows your product, knows your brand, they love it.
So give them the tools that they need to be successful. And I think a lot more brands are going to start tapping into that as a really great way to really work closer with their customers and bring customers along on that journey with them and create them into ambassadors.
And then finally, I think we're going to see a lot more regulation within the industry. So we had the Australian Institute for, oh name forgets me, it's AIM, the Australian Influencer Marketing Corporation, sorry, coworking space..
So AiMCO were introduced in Australia. So they just opened this regulatory board at the end of 2019 and that was introduced to bring a lot more transparency to the industry as there's been a lot of questions, a lot of lack of regulations and to make it a safer space both for the brands but also for the influencers as well to make sure that everyone's protected on all sides.
So as this channel grows and it becomes more important to brands, we're going to see a lot more of the regulation and transparency in place.
Nice. Valeria, any things that you are going to, are going to happen the up coming years with the channel?
Yeah, I definitely agree with the point around regulations. We do see that happening in China already, especially around livestream and how far the influencers can go promoting a certain product and how far they shouldn't go really.
But yeah, I think there will be definitely more pressure on the influencer to deliver high quality content, especially with platforms like TikTok, Bilibili in China for instance, which is a long video platform similar to YouTube, Little Red Book, WeChat definitely.
So there will be new formats popping up and this is definitely a pressure on influencers, both in terms of creativity but also in terms of resources.
So I personally think that if brands want to really build partnerships with influencers and to support them, they would have to be involved, be prepared to be involved in the co content production process and be willing to provide some resources to provide assistance, maybe to provide production capacities, capabilities to these influencers.
But also we are already seeing that in China. I think the West will be adopting this in the coming few years, the rise of social commerce and how social platforms are now becoming more integrated shopping malls rather than the actual place where you could discover content.
So it will be the merging of inspiration, the merging of product discovery and the final conversion within the same space. So where we used to have a longer user journey, that user journey would probably get shorter from the initial content discovery until the order is placed.
And TikTok has definitely been the pioneer here in China, which is the same platform. But yeah, Instagram's following the lead, I'm sure that messengers will follow soon as well.
We are seeing that with WeChat in China, pretty sure WhatsApp is doing something at the moment. So yeah, social platforms are not just, it isn't just Instagram for sure.
There will be more social platforms cropping up and more of them will be adopted to drive the entire conversion funnel from the very start, from the very launch.
Amazing. Sounds like a lot of exciting things are coming up for the upcoming year and in this channel. I would like to thank you very, very much for this great insights that you both gave into the influencer channel.
So thank you for that. And thanks everybody for watching as well, and stay tuned for more great sessions coming up.
Thank you for having...