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Influencer marketing is one of the hottest channels of the last few years. Itโs grown into a multi-million-dollar industry and doesnโt look set to slow down any time soon. Part of its huge success is due to the results that itโs generated for companies around the world. Instead of investing in traditional ads and sponsorships, theyโve found that partnering with key influencers drives incredible results. But not all organizations have mastered the art and science of influencer marketing. The accurate tracking of results and commissions has proved to be particularly difficult for some. In this article, we explore why itโs so tricky and how to measure the channelโs success more precisely.
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The Rise of Influencer Marketing
The nature of marketing has changed in recent years. In the past, companies were prepared to invest up front in advertising campaigns based on a hunch that they would generate a return. But since the credit crunch, ROI has become a driving force for marketing decisions at all levels. Businesses are no longer prepared to take a chance on channels that may or may not generate revenue. This is why influencer and affiliate marketing have taken off in a big way.
In fact, influencer marketing is one of the hottest marketing trends of 2019. The number of Instagram influencer posts is doubling year on year and delivering impressive results with Millennial audiences in particular. Companies are looking to grow relationships with customers at upper-funnel stages while also paying on a performance basis. This is why influencer marketing has emerged as a winning channel across the board.
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ROI Measurement Challenges
Influencer marketing has not been without its challenges though. One of the biggest hurdles for companies is how to measure its return on investment. Because influencers operate at the top of the sales funnel, their activities donโt always generate sales immediately. Theyโll likely introduce new people to your brand and widen your audience so that they can begin their customer journey. But converting them into paying clients takes time, so how do you quantify the ROI?
Measuring return on investment is a crucial part of any marketing campaign. If influencers canโt prove their value to businesses, then theyโre unlikely to be partnered with in the future. They need to be able to demonstrate their results and justify the investment made by a company in their efforts. But because theyโre a top-of-funnel marketing tactic, itโs incredibly difficult for them to prove their worth, especially in the initial stages of a campaign. So, whatโs the solution?
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Being Flexible About How We Measure Success
One solution thatโs been suggested is to be more flexible about the way that we measure the success of influencer marketing. Itโs not a case of saying โthis is too hard to measure so weโll track a secondary KPI insteadโ. Itโs about being realistic about goal setting and ensuring that campaign objectives are aligned with achievable outcomes. This will allow companies to measure the results of the channel more accurately and make evidence-based decisions accordingly. Of course, the ultimate goal of every marketing activity is to generate sales revenue. But there are steps towards this goal that need to be taken and against which progress should also be measured.
In the early campaign stages, influencers are most effective at increasing brand awareness and making introductions to your company. They can increase your audience so that you have a greater number of prospective leads dropping into the top of your sales funnel. They can also convert leads into purchasers through educational and promotional content but this comes later and takes time. The role of an influencer is different to that of a coupon or cashback site which are lower-funnel operators known for closing sales. So, it may be more prudent to track โattributionโ during the initial stages of an influencer campaign and extend their cookie duration to track long-term sales.
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A Practical Solution
If we accept that influencers are primarily โintroducersโ, then itโs clear that a standard cookie duration wonโt measure success accurately. Research shows that it takes 6-8 touches before a customer purchase and this wonโt always happen within a 30-day time window. The solution is therefore two-fold:ย
- ย ย ย Track attribution during the initial stages so you know that the influencer is driving traffic to your website.
- ย ย ย Extend their cookie duration to something more realistic, possibly up to 12 months to capture the real value of the traffic they drive.
This requires longer-term thinking but is a much more accurate way of tracking influencer marketing results. This will ensure that businesses can truly quantify the value of their marketing efforts with this channel. Itโll also mean that influencers are paid fairly for the results they generate, making them more likely to maintain promotional efforts long-term. By adopting this flexible approach, your business will have greater visibility of the value that influencers deliver and can make sound strategic decisions based on more accurate data.
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#1 AFFILIATE MANAGEMENT AGENCY IN THE USA
Advertise Purple is the #1 affiliate management agency in the USA. We help clients across the country to super-charge their affiliate revenue and get the most out of the channel. In fact, our clients see an average of 131% growth in affiliate sales within our first six months of campaign management.ย This is done for any niche, whether you are in it for direct e-commerce sales or lead generation.
Through our extensive network of high-quality affiliates, weโve driven over $22 million in revenue for clients. With over nine years of successful affiliate management experience and a team of dedicated experts, weโre revered by networks and publishers as the leading affiliate management company.
We strive to position clients as the top advertiser in their vertical. If we cannot ensure this, then we donโt take them on as a client. Through close affiliate relationships, proven strategy, and proprietary affiliate management tools, our affiliate management has proven to be the best in the business.
If you want to step up your performance marketing or need help developing your affiliate network, our team can help. Simply send us a message using the form below, call us on 866.833.0574 or email [email protected]. Weโd love to hear from you!
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