There’s no denying influencer marketing has grown up in recent years to become one of the most attractive marketing strategies.
Brands are aware of the potential of harnessing the unique relationship influencers have with their audiences. Their natural ability to make audiences “feel something”, as explained by the CEO of agency indaHash, Barbara Soltysinska, derives from their being “the closest approximation to friends or family in digital marketing”.
Despite the rapid growth, there are still discrepancies when it comes to measuring influencer marketing performance. Is it about reach or engagement? Can you describe your goals with metrics? And how can you measure any of it?
As much as influencers can be a brand’s best friend, the non-guaranteed return has been a cloud on the horizon ever since the channel took off. To mark the Influencer Marketing Show Takeover Week, PerformanceIN surveyed almost 100 participants to get to the bottom of the issue and find out how to measure the ROI of influencer marketing.
Engagement is key
A clear ROI-tracking winner, picked by a quarter of our readers (24.4%), is engagement.
Influencers have the potential to make a big impact on a wide net of audiences and social conversations, which can in effect extend brands’ reach, so engagement isn’t a surprising choice to measure performance.
Among those who consider it to be crucial is chief campaign officer at global network for product integration Branded Entertainment Network (BEN), Ricky Ray Butler, who believes engagement provides an opportunity to take a “macro look” at individual campaigns, which marketers can use to establish strategies for future projects,
"This will enable brands to build better relationships and work alongside influencers whose audiences are as interested in your brand as they are in their favourite creators," he commented. Even this one method can be measured in different ways across platforms; a simple way to track engagement on Facebook, YouTube and Instagram is with likes, comments, and shares.
For Soltysinska, too, engagement opens up a bigger picture, crucial for the entire brand.
"Engagement is the best metric to judge success; who is seeing, sharing or responding to your brand and creating a halo effect that will translate into footfall, sales and brand recognition," she explained.
Engagement isn’t everything, however, and a significant chunk of respondents cited referral traffic, trackable links and new sales to be crucial; each of the methods favoured by 18.3% of our readers.
For Theresa Bär, online marketing lead at CupoNation Germany, combining branding with performance marketing is key, therefore, apart from engagement, new sales and trackable links are the most relevant metrics to measure influencer marketing ROI.
"When it comes to performance and influencer marketing, metrics such as a high engagement rate and reach, a good CPE [cost per engagement], plus a smart integration of trackable links - Instagram stories, YouTube videos, etc. - should be taken into account when setting up a strong and successful campaign that can generate revenue,” she commented.
For Rakuten Marketing’s SVP and managing director, global, attribution, James Collins, it’s the action taken by consumers that make the difference, with time spent on site, pages visited and high-value areas of the site traffic visited being important measures of value.
“It’s not just about the fact they visited the site, but what did they do with that visit? Did they research products? How long did they spend looking at content? Or did they just bounce and disappear straight away?” he said.
By far a less important measurement of performance in influencer marketing is social media growth, with only 8.5% of respondents considering it a key method. Despite follower-count being less of a priority, however, social is still taken into account.
“For platforms with trackable clickthroughs such as Twitter, Pinterest and Facebook, you can think of influencer marketing as a form of direct marketing that means you can measure impact quite easily,” commented Solberg Audunsson, co-founder of influencer marketing platform at Takumi.
Giving social more merit, Bär argues that for branding, social media growth and costs per mille (CPM) are particularly applicable.
“Those metrics will influence a brand's ROI in the long run. Shaping brand perception through influencers has positive branding effects and helps to grow the brand’s social media channels,” she commented.
Some argue that the metrics used should depend on brand’s individual goals, and defining those ahead of running an influencer marketing campaign will impact the way performance is measured.
Collins believes that if new customer acquisition is the key goal, brands need access to data differentiating between new and existing customers, as that’s the only way to reveal the true value of influencers for new customer revenue.
According to a study from Rakuten Marketing quoted by Collins, influencers start more customer journeys than any other affiliate publisher type, being the first touchpoint in a user journey 53% of the time.
“This means that leveraging attribution and analytical tools that provide a multi-channel view across the whole user journey is essential to demonstrating the impact influencers have on sales. Only by having this view can performance marketers understand the value of influencers – and indeed any other touch-points consumers interact with beyond the last click,” Collins explained.
Influencer marketing ROI can be measured in numbers. There are different ways to do it, and while engagement, trackable links and new sales are some of the most reliable metrics to show tangible results, a lot depends on each brand’s individual goals and definition of success.
Although trackable metrics are key in the space of performance marketing, when it comes to influencer marketing, raw data might not always reflect the whole impact the channel might have on audiences.