The Role of Influencers in Consumer Purchase Decisions

Why is Influencer Marketing so Effective With Today’s Consumers?

Whether you’re a marketing professional, entrepreneur, brand strategist, or even just a consumer, you’re acutely familiar with the term “influencer,” which has been popularized over the past few years. But just how important are influencers in consumer purchase decisions? And can brands – perhaps your brand – better leverage this element of marketing for maximum efficacy?

What is Influencer Marketing?

Influencer marketing isn’t new, but it has taken on a unique approach in recent years. It’s a type of marketing that emphasizes the use of essential and recognizable figures to help brands connect with specific audiences and cultivate trust. Rather than deliver a generic message to a broad market, brands can partner with individual influencers to tap into highly motivated pockets of the market that are willing, ready, and likely to convert.

Influencer marketing has been around for years. Celebrity endorsements are one example. Rewind to the early 1900s, and Mark Twain was co-branding ink pens, and Ty Cobb had is own tobacco endorsements. Things took off in the 1950s and 1960s when endorsements moved into TV media. This episode The Andy Griffith Show was one of the first to feature an integrated advertisement within a scene. Then came the famous Mean Joe Green Coca-Cola ads in the 1970s, the Michael Jordan-Nike partnership in the 1980s, and on and on. 

So it isn’t accurate to say influencer marketing is a fashionable idea. However, it’s undoubtedly true that influencer marketing has taken on new meaning, power, and application in the age of social media.

There were just 970 million social media users in 2010. By the end of 2020, there will be close to 3 billion global social media users. In the past, brands had to leverage TV or radio to reach the masses. Social networking has opened up an entirely new channel – one that’s more efficient, effective, and accessible. 

Today, almost anyone can be an influencer. Brands don’t need millions of dollars to sign long-term contracts either. A well-selected partnership can be natural and mutually beneficial. 

Who Are Influencers?

Most people can name a couple of influencers without much trouble. All you have to do is think about famous athletes, actresses, musicians, or other public figures. But who are these people?

When applying the “influencer” label to an individual within the context of marketing, the individual must possess a combination of three distinct factors: 

  • Reach. This refers to the number of people the influencer can deliver a message to. In terms of social media, this is the follower count. Someone with a reach of 2 million people has a more significant potential to influence than someone with 500 followers. (Though it should be noted that the quantity of followers isn’t nearly as substantial as quality/engagement of followers.) 
  • Credibility. There must be a degree of trust and authority between the influencer and the audience. In particular, there needs to be contextual credibility. In other words, one influencer might have high contextual reliability in the field of fashion and design, but low contextual likelihood in video games.
  • Sales skills. Finally, an influencer possesses some natural salesmanship that allows them to convince and persuade followers to move towards a specific call-to-action. 

Think of these three factors as legs on a stool. If you kick off one of the legs, the seat comes crashing to the floor and ceases to be a stool. You need all three for it to work. The same is right with influencers. If someone has 1 million followers but no credibility with his audience, it’s hard to influence those people. If someone has exceptional sales skills but only has 25 followers on a Twitter account, the ceiling is low. Credibility is excellent, but even the most credible person needs sales skills and an audience to execute.

In the world of influencer marketing, you can find two basic categories:

  • Macro influencers. A macro influencer is the first category that most people think of. It includes household names – people like Kylie Jenner, LeBron James, and Justin Bieber – who have audiences of millions. They bring high visibility and awareness to the table.
  • Micro-influencers. Social media has given rise to micro-influencers, who are everyday folks with sizeable, highly engaged audiences. These people may have just a few thousand followers, but they’re compelling and highly trusted in a particular niche. If you have a hobby – like gardening, comic book collecting, or backpacking – you can probably name a couple of micro-influencers who have clout in this niche. Your friends outside of the hobby might not know them, but those on the inside certainly do.

The type of influencer a brand partner with is highly dependent on factors like messaging, budget, and intended audience. Most companies don’t have the financial means to partner with macro-influencers, but can quickly come alongside a micro-influencer to generate meaningful results.

Why Does Influencer Marketing Work?

Now that we clearly understand who influencers are, let’s dig in a bit deeper and figure out why influencers are effective. In other words, why are consumers so heavily influenced by these people? Here’s a peek at the psychology behind this powerful marketing strategy:

  • Social proof. Humans are social creatures. We’re designed to interact with other people and seek connection and approval. For better or worse, this leads to a pack mentality where we crave cultural conformity. Because we see influencers as aspirational figures, we naturally want what they have. This gives influencers the ability to impact the audience’s decision-making.
  • Personal connection. Influencers – and micro-influencers in particular – are perfect about developing meaningful relationships with their audiences. It makes individual followers feel deeply and personally committed. And just like people trust their closest friends, people are inclined to believe the individuals they share a personal connection with via social media.
  •  Informational social influence. This term is defined as, “The change in opinions or behavior that occurs when we conform to people who we believe have accurate information.” Within the context of social media figures, these people have the definitive ability to deliver informational social influence. 

Consider that Influencer Psychology 101 – i.e., a pretty basic look at the topic. There’s a lot more happening at a neural level than we realize. However, this much we know: Influencer marketing is highly effective, and every brand should be using it in one way or another.

How to Develop and Execute an Influencer Marketing Strategy

Influencer marketing is highly flexible, versatile, and unique. No two brands will adopt the same approach or strategy. However, there are some general rules and techniques that increase the chances of success. If you’re interested in developing and executing an influencer marketing strategy for your brand or business, here are some things to consider:

1. What’s Your Goal?

You can’t launch an influencer marketing strategy without first identifying a precise goal for the campaign. Your goals will help you shape a consistent approach that can be executed with precision and accurately monitored and analyzed.

Some examples of goals include: enhancing brand awareness, link building, driving sales, cultivating customer loyalty, driving engagement, building brand identity, and generating leads. It’s entirely possible that you want to accomplish one or more of these goals simultaneously. 

Once you identify your goal(s), dig a little deeper. It’s not enough to say you want to drive engagement – what kind of commitment are you seeking? Specificity is paramount to the success of an influencer campaign.

2. Who Is Your Audience?

Just because you can partner with a particular social media influencer, doesn’t mean you should. Every influencer has a unique audience, and it’s imperative that you have an intelligent understanding of who your intended audience is so that you can connect with the right people of influence. 

Be careful that you don’t focus too much on the size of the audience. While reach does matter, it’s about quality of engagement – not quantity. You’re much better off putting your brand on a collision course with ten people who are likely to purchase your products than 100 people who have very little interest in what you’re offering.

The key is to look for influencers who have an audience that mimics or overlaps with your target audience, which includes demographics (age, gender, job, etc.), beliefs (political, religious, etc.), and interests (hobbies, skills, etc.). If you run a local home improvement store, partnering with a home DIY influencer would make a lot of sense. If you run a web design agency, an influencer who is focused on entrepreneurship and startups is a good fit. It’s all about the audience. 

3. Micro vs. Macro Influencer

We’ve already explained the difference between micro and macro influencers, but which one is best for your marketing campaign?

Generally speaking, micro-influencers are known for high engagement and lower reach, while macro-influencers have an extensive range with less involvement. One study shows that micro-influencers generate as much as 7-times more engagement than macro-influencers. And as an influencer’s follower count increases, their engagement rates diminish. 

If high engagement is a priority, you’re better off finding a good micro-influencer with an active, highly connected audience. This person might only have a few thousand followers, but you’re bound to get some high-quality interactions and prolonged exposure. If you’re selling a generic product and don’t necessarily need lots of one-on-one engagement, a macro influencer with hundreds of thousands of followers will allow you to reach more people and (presumably) drive more sales.

Cost is another major factor. A top influencer with several million followers can charge five- or six-figures for a single post. Someone with several thousand followers will cost just a few hundred to a few thousand dollars.

4. Mutually Beneficial

Remember that you’re partnering with an influencer, which means you have to deliver a mutually beneficial offer. 

Social media influencers are constantly bombarded with requests from brands. If they accepted them all, they’d continuously be sharing branded content, which would kill their authenticity and compromise their relationships with followers. Thus they’re pretty discerning in which brands they work with.

If you want to build a partnership with an influencer, consider what’s in it for them. Financial compensation is one ingredient, but what else? Is the product a natural fit? Can you provide them with a service that helps them improve their own life? Does the partnership provide clout for them in their niche?

5. Content Creation

One of the most significant differences between a celebrity endorsement campaign and working with a social media influencer is that you must be willing to release your grip on content creation and control.

A social media influencer is an influencer for a reason. They know what their followers want and have perfected the ability to satiate these desires. Partnering with an influencer and then handing over some creatives that your marketing team designed in-house defeats the purpose. Let the influencer create the content. (Yes, you have the final say!) It’s much more useful this way.

6. Tracking Results

Finally, there has to be a concrete way of tracking the results of the influencer partnership. Typically this means collecting and analyzing data. It’ll look different for every campaign, but make sure you have some specific key performance indicators in play. 

Reaching Consumers Where They Are

Influencer marketing isn’t about manipulating people or gaming the system. It’s probably the most natural, honest, and transparent form of marketing that exists today. When a brand partners with an influencer, it’s able to humanize its message and deliver it to the right audience via an individual who has already established trust and credibility. It’s about reaching consumers where they are so that you can provide them with a product or service that meets a distinct need or desire. 

Any business that wants to cultivate credibility and generate positive traction within the marketplace needs to give influencer marketing a try. It’s arguably the most effective marketing strategy that exists today.

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