Influencer Marketing has turned out to be a notable technique that is quickly becoming a vital arsenal in a brand’s marketing war. Recent estimates of Indian spending are a walking testimony that shows how influencer marketing is evolving into an increasingly mainstream strategy for modern brands. The industry which grew 40 percent in 2021, is keeping up its growth in 2022 as well with increasing revenue from Rs 900 crore to Rs 1,200-1,300 crore. 

Understanding Influencer Marketing 

With the advent of the creator economy, 71 percent of advertisers are deciding to make use of influencers to promote their products and services to drive quality traffic and leads, improve brand awareness, and convey messages to their target audience. This new era of ‘mimetic’ marketing is helping customers to simplify their decision-making and build the brand's trust and credibility among the audience. This democratic media consumption is increasingly ranking high in the domain; in fact, in the name of ‘role models’, celebrities only accounted for 27 percent of influencer marketing spending. The rest of the 73 percent included nano, micro, and mid-tier influencers because of the high relatability quotient and trust that they share with their audience. 

It is becoming a huge hit in the B2C space but as millennials are one of the bigger online shopper segments, and trust influencers 12 percent more than celebrities, it is hard for B2B businesses as well to ignore influencer marketing’s role and as a result, many have begun applying it, too.

Potential of Influencer Marketing

This model is proving to be most effective because of the high level of trust social influencers have with their followers. So, when they recommend products or services, it not only leads to social validation but also drives their follower's decision-making power.

Another potential that marketers expect from influencer marketing is generating sales and conversions. According to research, every $1 they spend on sending a message to the customer via influencers, ends up companies earning about $18, and this number can be higher and vary for many other brands. This is the impact of influencers and that is why it is exceptionally viable for businesses to create, manage, and create messages via influencers to generate a massive uptick in sales.

As this pay-for-performance model is empowering millions of consumers to make better purchasing decisions every day, companies can leverage this channel to build their own advertising ecosystems and create numerous revenue drivers across multimedia touchpoints.

Doing advertising via influencer marketing is relatively reasonable as compared with other forms of advertising. Along with opening new opportunities for brands to compete with a more efficient and optimized strategy, its benefits outweigh the cost spent on it, which result helps the brands in earning huge ROIs, boosting sales, and saving more money. 

Heavy-handed promotions and sales campaigns have simply become an outdated model for brands. Collaborating with influencers who can seamlessly combine brand campaigns into their style and expression is becoming the new norm. They offer a viable, unobtrusive way to communicate and enhance a brand’s visibility. 

Potential Problems of Influencer Marketing

As influencer platforms are so easily accessible that they have become nothing more than a competitive arena where brands have to compete dollar after dollar to get the perfect influencer for their campaign. It results in making brands compete with each other, which ultimately ends in raising the price of campaigns. 

The selection of influencers plays a very important role in influencer marketing as the performance of your campaigns depends on it. But the high number of fake influencers on social media platforms not only questions the brand’s credibility but also takes users for a ride. 

One of the major concerns of about 65 percent of marketers is to measure performance and ROI and it takes a significant amount of time to run influencer campaigns. Hence, the only optimal way for brands to measure ROI depends on what goals they have set for any particular influencer marketing campaign. 

Instead of followers, the brands should shift their focus to the quality of engagement influencers get from their audience. This not only ensures avoiding working with fraudulent influencers who artificially inflate their numbers but also ensures that the campaign they are running is reaching the right audience. 

In many cases sponsored content also fails to generate the desired engagement rates as when influencers are pushing products on them, audiences tend to ignore whatever the influencer says about the brand they partnered with. This is partly the reason why brands are willing to shift to investing their money with micro or nano influencers as they would much rather see an honest review of a product than a sponsored post.

Conclusion

There are many pros and cons of influencer marketing that you should be aware of but the model is here for the long run. By being diligent with research, knowing what to expect price-wise, and hiring a professional Influencer Marketing Agency it is possible to overcome the challenges of influencer marketing. After all, the market will always be volatile but how marketers react and approach these challenges determines whether they are successful.