2018: Year of the Influencer or year of the influencer marketing implosion?

If you haven’t tried influencer marketing, you may feel as if you’re in the minority. Many brands have plunged into it and seen a positive impact on revenue. And yet there are substantial risks that accompany influencer marketing that should scare any brand or agency wishing to engage in it.

What is influencer marketing?

Influencer marketing is when brands partner with social media “influencers” — people with a large following on one or more major social media platforms — to promote their products or services. These influencers may be actual celebrities (such as actors or professional athletes), or they may simply be popular figures within their social media platform of choice (such as YouTube stars or Instagram models).

The principle behind influencer marketing isn’t new. Brands have been using celebrity endorsers for many decades because they’re an effective way of transforming public affection for athletes, actors and other notable people into memorable impressions (and therefore sales) of a brand’s products or services. When an agency hired such a celebrity, they were effectively leveraging all the dollars spent to promote that celebrity in movies, in the press and on the playing field to advance the client’s cause.

Similarly, influencer marketing leverages both the prior work of a social media influencer (in terms of organically building his/her own following on YouTube, Twitter, Instagram and so on) and the inherent power of each to reach a worldwide audience provided by the platform he/she is active on.

What’s different is that today’s social media influencers are often much “edgier” than the celebrities of yore. These semi-autonomous social media stars often do “daring” things that are often not cleared beforehand by the agencies hiring them. They might or might not disclose that their content is paid for with agency/brand dollars.

Their edgy lifestyle may also get them into trouble offline. In this “Wild West” environment, it’s very easy for brands and agencies to get burned if the influencer does something embarrassing or offensive. Case in point: last week’s flap over Logan Paul, a major YouTube celebrity with 15 million subscribers, who elected to publish a video of himself discovering the body of a suicide victim. Although the video was quickly taken down (and, when last checked, no major brands were running ads on Logan Paul’s other videos), the extreme blowback generated by this incident illustrated the potential dangers to brands that arise when they stand too close to high-profile social media celebrities whose desire for clicks and ad dollars outweighs the norms of common decency.

Despite the risks, there are lots of great reasons to be attracted to influencers and influencer marketing. People look up to notable people, want to be like them and often want to purchase products they use or endorse. If you’re smart, careful and alert to the dangers, a relationship with a high-profile social media star can “cut through the clutter” like no other channel can. So let’s look at the major pros and cons of influencer marketing:

Pros of influencer marketing

• No ad blockers. The rise of ad blockers is particularly troubling to marketers and to publishers/broadcasters. Influencer marketing — if it’s successful — results in an “editorial” product that ad blockers will not touch.
• The only way to reach certain demographics and psychographics. Some consumers don’t watch TV, listen to terrestrial radio, read newspapers or magazines (printed) and are probably looking at their cell phones while being driven past billboards by their driverless Uber cars (OK, not driverless yet).
• A personal connection with the consumer (as perceived by the consumer).
• Brand-building through the “halo effect.” The influencer’s positive relationship with the brand in the eyes of the consumer raises the consumer’s awareness and opinion of the brand simultaneously.
• Copycat behavior. Some fans want to be just like their favorite influencer (which is why you may walk down the street and see people wearing a YouTuber’s merchandise).
• Second-order effects (often overlooked). When you align with an influencer, this in itself may be newsworthy, generating organic PR coverage, both online and offline. This second-order impact is why SEO can benefit from influencer marketing. While a hard link (follow link) by the influencer on his or her domain or preferred platform is highly discouraged in a sponsorship or influencer relationship by Google and the other search engines, some bloggers and journalists covering an announcement may provide hard links to the sponsor and/or influencer.

Risks of influencer marketing

• Brand damage if an influencer gets into a scandal. Within the celebrity spokesperson space, unexpected fiascos have happened many times — from golfer Tiger Woods’ marital infidelities to celebrity chef Paula Deen’s racist remarks — forcing brands to quickly distance themselves from them.
• Regulatory intervention due to insufficient or missing disclosure of sponsored content. In the US, general enforcement of these rules and guidelines is left to the FTC (Federal Trade Commission), however, recently even the FCC (Federal Communications Commission) has gotten into the act, fining Sinclair Broadcast Group more than $13M because paid programming was not disclosed to viewers. (Sinclair isn’t an influencer, but the disclosure policy is the commonality.)
• They feed on your brand. You may help inflate an influencer’s standing and legitimacy by becoming their sponsor, meaning that you are paying them to make them bigger.
• Influencer fraud. Brands sometimes get sucked into social media influencer ratings and don’t dig deeper. It’s super easy to be seduced by huge follower and engagement counts and be taken in.
• Brand safety and control. While brands like their influencer campaigns scripted, the lack of authenticity often shows through. However, it’s both higher risk and higher reward to let the influencer interpret the instructions given by the brand.

Is influencer marketing worth it?

Influencer marketing — like any celebrity endorsement-based marketing — is a gamble. In many cases, it will pay off; but when harnessing one’s campaign to a fallible human being, one must always be prepared to do damage control. There’s no question that today’s click-seeking, thrill- and prank-providing influencers often push things too far.

My take on the risk-reward dynamic in influencer marketing is that 2018 will both be the year of influencer marketing as well as the year of the influencer implosion. The rewards are so high in the current media landscape that brands may feel they simply have no choice but to take the plunge. There will be some high-profile implosions, and brands will become a bit more careful about their influencer relationships.

The best that marketers can do right now is to become familiar with the regulatory environment, learn lessons from influencer fiascos — both online and off — and read the guidelines that Google and other private arbiters of the influencer marketing space have issued for those engaged in this potentially lucrative, but uniquely perilous, marketing channel.

Pay special attention to the FTC’s warnings about full disclosure, and don’t cut corners (or allow your influencer to cut corners) in terms of being fully transparent about who’s paying the bills. Because if you cut corners with influencer marketing, those corners are more than likely to come back and cut you.

Opinions expressed in this article are those of the guest author and not necessarily Marketing Land. Staff authors are listed here.

About The Author

Kevin Lee

Kevin Lee is Co-Founder and Executive Chairman of Didit a leading digital marketing and technology firm started in 1996. Didit has made 11 acquisitions to transform itself into a one-stop-shop full-service marketing firm from a SEM/SEO boutique. Kevin continues to invent new technology platforms for Didit and for clients. Kevin also co-founded We-Care.com generating over $8 million for nonprofits via cause-marketing. As a true Digital Marketing pioneer, Kevin gives back to the industry via 4 books, speaking engagements, and 780+ published columns. Kevin received his MBA from Yale University and lives in Scarsdale with his wife Dr Allison Kahner and two kids.