a UNSW Business Society official publication
Less is More: How the Rise of Social Media Influencers Transforms Modern Marketing and Business
Written by Hillary Lee
Date Published: 22/07/2020
Your favourite beauty guru just recommended their favourite makeup item which gives them that afternoon glow or glass skin. Your favourite fitness Instagrammer just posted a picture of them in their best workout gear, posing and showing off their physique in the gym mirror. You take a look at the description box or caption; there’s a 15% discount if you use their affiliate code, and even a chance to enter their latest giveaway with some free goodies up for grabs! It’s tempting to have a look at the site linked below, isn’t it?
In our current digital age, situations like these are more common than we think. Since we are becoming more educated as media users and more critical of the brands we choose, businesses struggle to stand out amongst the never-ending crowd of advertisers, and thus must find a way to survive in the market. Micro-influencers are leading this new wave of marketing strategy and system, overcoming the traditional advertising oligopoly of tv ads and glamorous celebrity endorsements.
Micro-influencers are everyday people who have a growing number of followers on social media accounts, simply for expressing themselves and their interests and posting at a regular frequency. A mere 1000 followers are enough to establish yourself as a micro influencer. (You might think to yourself “Hey, I have more than 1000 followers on Instagram, does that make me a micro-influencer too?” Well, yes. You could well be!)
DIVING DEEPER: So, why do businesses take this millennial approach to marketing?
1. It’s Effective.
If you’ve caught the eye of a business and they’ve asked you to promote their product on your account, surprisingly, you would likely receive higher engagement rates than the celebrities we see on television. This is because followers value the authenticity, relatability and everyday presence of ordinary people just like you and me.
A promise via influencer marketing is that brands will become more memorable and trustworthy as their products appear on profiles after numerous mentions.
When a YouTuber continues to talk about a certain product within a number of vlogs, or an Instagrammer continues to tag the same brand in their photos, this ultimately increases brand awareness.
This is more affordable for small industries and start-ups trying to break through the competitive environment, compared to top influencers with millions of followers who charge over $2,500 for a sponsored YouTube video or $1,000 for a sponsored post on Instagram. As small businesses have limited influencer marketing budgets, micro-influencers are their most powerful assets for market penetration.
2. It's Affordable
Micro-influencers sometimes receive products for free and are happy to work with brands without significant compensation, whilst celebrities and mega-influencers are paid large amounts for their endorsements. Even then, businesses are not guaranteed priority or immediate success as celebrities tend to work with a countless number of brands.On average, if not receiving products for free, a micro influencer costs around $180 per post on Instagram.
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3. It’s Authentic.
Audiences generally prefer more realistic, authentic and not overly glamorous marketing campaigns. The smaller following of micro-influencers allows for more manageable engagement and builds trust with customers as they tend to have more personal relationships with micro-influencers. Data collected from a large-scale national survey in the U.S. highlighted that only 3% of consumers would consider buying a product that was endorsed by a celebrity. This is compared with 30% of people who would consider purchasing a product endorsed by a non-celeb micro influencer. Businesses benefit as return on investment is said to be 11x more when working with micro influencers.
DIVING DEEPER: From the perspective of a growing influencer – Sponsorships and Money
DIVING DEEPER: Google Adsense – The Win-Win Situation
From personal experience, the first thing people ask when they find out someone has a YouTube channel, and has a fair audience of above 1000 subscribers is “Do you get money from YouTube? How? Do you consider it your part-time job?”
There’s an extensive range of ways that you can earn money off being a micro-influencer on social media, like from sponsorships and partnerships, however, Google Adsense is probably one of the easier and more popular ways of doing this. Adsense is a free service that allows you to monetize your YouTube videos, matching relevant advertisements with your channel. When one of your viewers clicks on an ad on your channel or on one of your videos, you get paid a specific amount of money.
Advertisers and businesses bid on the video ad space that YouTubers provide on their monetized accounts. The highest bidder gets their advertisement showcased in a banner ad or pre-roll video in your video or on the sidebar of your channel. The company or individual behind the advertisement is charged and influencers get a share of the money that they pay Google to showcase it. The more people that visit your channel and watch your videos, the more that will see these advertisements and potentially become interested in the products or services of those companies.
Partnering with Google can create mutual benefits. Google can generate profit from ad revenue, with a certain percentage of this going back to micro-influencers. In this way, they are rewarded for creating quality content that viewers can engage with, sustaining their creative ventures and facilitating entertainment for the masses.