Influencer Marketing – Cheap Advertisement or a Way to Get Rich?

Influencer marketing has come with the internet and social media as a new way for brands to advertise or create brand awareness. Read how it works, about the good and bad practices, the consequences for consumers, and blogger as a new profession.

 

 

Updated: 2/23/2022

Disclosure: Sponsored post. This post includes affiliate links.

 

How the Internet Changed the Way We Shop

When the internet came up, predictions were that most of the clothing would be bought online. Of course, there were opinions that customers wouldn’t buy clothes when they can’t check the quality or craftsmanship. These voices were soon be proven wrong thanks to online customer friendly return policies and proactive statements of two-way shipping, free return – no questions asked.

However, in the end, the customer pays returns indirectly. The calculation of prices is a complex optimization. It includes what they paid the manufacturer and the costs of the middlemen. Beside the labor costs to pack the order, overhead, and anticipated profit, among other variables, it considers shipping costs, potential damage, and average return rate. The “free return” is  distributed equally among all customers, no matter whether they return or don’t return the merchandise.

Along with online fashion and the upcoming of social media in the first decade of the Millennium advertisement changed. A whole new job market developed around the internet and social media with bloggers and trendsetters. As often when there is a new demand in work force and ways of marketing, there exists a lot of trial-and-error.

 

How Does Influencer Marketing Work?

What Are Social Media Influencers?

People with large followings on social media and high engagement rates, who promote products or services on their accounts or blog are influencers. Their audiences pay attention to their posts and come back again for more. Consequently, businesses are interested to work with influencers.

Social media influencers can promote a business’ offers by

• sponsored blog post,
• affiliate links,
• delivering in-real-life personal reviews in exchange for a sample
• driving traffic to the business’ blog or store, or
• generating leads.

Depending on the task at hand, some platforms are better than others.

 

 

 

How Does Affiliate Marketing Work

If influencers advertise and sell from their account, they will get commissions when their followers purchase thru the affiliate links. You don’t pay more when you purchase a product through these links. Like with the return costs, the commission is distributed over all online purchases of the business. No matter whether you order directly from the online store’s page or via your favorite influencer’s affiliate link. You pay the same.

These links just make it easier for you to find something. The influencer only gets a few cents. Typically, anywhere between 5 to 15%. The commission depends on the total sales value that is made due to the influencer’s efforts. Affiliates can also download promo codes from the brands and share them with their readers. See for instance, my Discounts, Coupons, and Promo Codes page.

 

Micro- vs. Macro Influencers

Brands distinguish between nano-, micro- and macro-influencers. Nano-influencers have less than 2000 followers. Micro-influencers have between 2,000 and 50,000 followers; macro-influencers more than 50K.

Depending on the goal of the campaign and budget, brands prefer one over the other category. A thought leader may be best for services and B2B (business to business) campaigns. A low following means the audience has a high percentage of friends, colleagues, and family. This means there is trust in the eyes of the consumers. Great for food, beauty products, pet items!

 

What Does Influencer Marketing Look Like in the Fashion Niche?

It’s a mixed bag of high professionals, and non-professionals on both sides. However, the latter are (still) a minority.

 

Substitute for an Ad?

Ads are expensive. Fashion influencers are offered all sorts of (cheap) clothes in exchange for promoting the brands. Often bloggers are asked to pick a sample of their choice from a page of selected items (that the brand wants to promote) rather than their entire collection. This explains why many influencers are barely distinguishable on Instagram, for instance. Over many posts by different (similar looking women), it works like an ad. Maybe (on the short-term) even cheaper. Fans trust their favorite blogger, right?

 

Short vs. Long-Term Collaborations and the Role of Ranking

The ranking of online stores in searches depends, among other things, on their domain authority. This means how many sites link to their store. Looking for new collaborations brings more backlinks. As the brands don’t link back to their promoters, tastemakers are more interested in long-term collaborations like ambassadorships. However, not everything that shines golden is gold, it could be pyrite. Look twice.

 

 

 

Taking Advantage (of the Newbies)

A fashion brand, for instance, offers an ambassadorship that would mean the trendsetter gets 75% off of all items on their site. In exchange, the brand might (!) share the ambassador’s posts of the brand’s items with the brand’s over one million followers. Alone that exposure would be already worth $$$s in money according to their representative. Sounds great, right?

But wait! To start the ambassadorship, the maven has to choose a graphic T-shirt from the brand’s ambassadors’ page. They ring in at $149! Even with 75% off, it’s still $37.25! Hello! Sure, you have to invest money to make money!

But why would you want your readers to buy a Tee at a price tag, at which you would never buy it? Just because you get it 75% off? Post it once, may be twice? And you only might get the share on social media!

Might means perhaps, it’s not sure, no guarantee! They don’t even state a likelihood like 1 in 10000, or so. Furthermore, no written contract other than an email! Especially, with nano- and micro-internet fashionistas, readers are friends, and

Friends don’t let friends buy overpriced clothes!

 

Low Pay, High Work Loads

Some non-US, non-EU brands offer between $5 and $20 for a post that features photos of their fashion. The influencer is to take any photos of their store site for the post. Sounds like a quick thing, right? But it’s not!

Did you ever want a friend’s opinion on a piece you saw online? If so, you tried to save the photo. It didn’t work, right? Frustrated you sent the link to your friend instead of attaching the photo to your message.  In other words, you sent that online store a visitor, who actually didn’t intend to visit that store. That is the purpose, why you can’t download the image.

As a result, the influencer has to work-around to download the photos, and finally use these photos in a post. But (wo)man, doing is time-consuming! Consequently, the person gets cents per hour, if they are lucky (and actually get paid)!

Of course, in influencer marketing, the blogger has also provide non-promotional content because that content is why they have followers. In principle, these costs are overhead. This content costs time, but remains unpaid. Even a club charges up to 50% overhead. However, $5 to $20 don’t even cover the time for these posts.

 

Which Roles Do Social Media Play?

A huge one! A person has no ownership of their social media accounts. The accounts can be closed like it happened with google+ a couple of years ago.

Any changes social media platforms make, affect the influencer marketing. Over time, all platforms have reduced how many fans see their bloggers’ posts.

In response, the metrics have (and will be further) diversified looking at engagement rates, conversions and website traffic, etc.

On some platforms, additional features are available for influencers over a certain amount of followers, i.e., the macro-influencers. However, the influencers get stuck at a number below. Then the platform sends messages/emails to promote post XYZ. The text says “Post XYZ does 75% better than most of your posts. Promote this post with ABC dollars to reach more people.” Promote means the influencer has to pay for the post to be shown to more readers.

 

Recognition of Blogging as Profession Is the Next Big Change

About 3 or 4 years ago, many brands have begun to recognize blogging as a profession and business, and turned to B2B practices. Read negotiations, fair payment, contracts, bills, etc. Some brands even moved towards educational collaborations. The product is just mentioned, if at all (just seen). The reader gets information on a question, they actually have, for instance, what to pack answered by fashion influencers, and become aware of the product on the side. Win-win for all three parties.

 

Movement Towards B2B Practices

Metrics have been built that provide guidelines for what to charge/pay. Marketing firms have been founded that do the negotiations between the two parties. Think of it like a job market where tasks and services are offered, well defined, with written contracts and deadlines for fulfillment and payment.

These businesses also promote their specialists, see for instance, this spotlight of Mona Farzam, who is well known from TV and social media.

 

Self-Server Blogger Outreach Platforms Enhance Quality of Influencer Marketing

Brands can get free listings on self-service blogger outreach platforms, and offer jobs for blogger. The bloggers can browse these listings for free. When they have the expertise required for the job, they write a proposal to the brand. Therein, they state how they would carry out the work if they were hired by the brand. The brand gets these proposals, and retains full control over who they do and don’t hire. When the brand hires a blogger, the brand pays 20% commission on any work commissioned via the platform.

 

What Do These Changes towards Professionalism Mean for the Consumers?

Foremost, clarity and transparency. Better information. To be professional, ads, sponsored content, affiliate links are disclosed as such. The trust of the readers is the capital. Honesty is key in reviews and sponsored post.

In the fashion niche, wearing a piece in multiple ways, and in different posts is a Must for the trendsetter. The reader gets outfit ideas for the piece they bought.

Since it’s a new profession, the work force comes from a diversity of educational backgrounds. This means new ideas, new perspectives, and new points of views.

Maybe more interesting, and intelligent advertisement. Would you buy a washing degrend because it takes dirt out of a knotted garment? Would you buy a $149 T-shirt just because it’s all over social media?

 

Conclusion on Influencer Marketing

There are easier ways to get rich. Cheap is just cheap. In the end, it will fire back. Professionalism stays. It is just a matter of time that brands will carefully choose their trendsetters for their influencer marketing. However, this work is time consuming. Therefore, over time, more and more smaller businesses or brands will turn towards blogger outreach platforms. These companies vet their blogger network to ensure that their bloggers are reliable, trustworthy, and deliver high quality of content.

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