Traditional vs tech-based IM: Can influencer marketing replace traditional marketing?

New Delhi: The way brands connect with consumers has undergone a seismic shift. Today's digital landscape presents a critical challenge: customer retention, with digital brands struggling to keep audiences engaged (retention rates hovering around a mere 5%). 

Bombarded by one-way advertising, consumers crave authenticity and connection. This shift hinges on a fundamental principle: trust. This, I believe, is the driving force behind the rise of influencer marketing, a digital strategy that leverages the power of trusted online voices.

According to Kofluence’s latest 2024 benchmarking report, the influencer marketing sector has been growing at an impressive annual rate of 45%, with the industry projected to reach a valuation of $2.8-3.5 billion by 2028. 

Does this mean the end of established channels or a catalyst for a marketing revolution? The answer, like the path of the migrating consumer, is likely more nuanced.  

The shifting landscape: From awareness to engagement and leads

For a long time, brands have relied on traditional marketing methods to reach and interact with customers. Traditional marketing excels at creating broad brand awareness, as exemplified by iconic campaigns like Coca-Cola's holiday commercials, which have become cultural touchstones associated with happiness and togetherness. Similarly, a strategically placed magazine spread, like Dove's "Real Beauty" campaign featuring diverse models, can leave a lasting visual impression, fostering brand recognition and positive associations.

However, traditional marketing faces challenges in today's hyper-connected world. Consumers are adept at tuning out noise.  Ad blockers are on the rise, and cord-cutting is prevalent. As per the latest edition of The CMO Survey, Traditional advertising marketing spending remains in pre-COVID negative growth territory at -2.1%, down from -0.06% in Fall 2023. 

Enter influencer marketing, a digital-powered approach that capitalises on the power of established online personalities. Influencers, who have built communities around shared passions and interests, foster trust and engagement with a targeted audience. Unlike traditional marketing, which has a broad but passive reach, influencer marketing thrives on active engagement. This approach allows brands to deliver targeted messages to their audiences. By collaborating with social media influencers, businesses can deploy authentic brand advocates whose engagement and connections help them reach the right audience. Influencer marketing platforms also offer robust tracking capabilities that go beyond vanity metrics. Unique trackable links, promo codes, or discount codes shared by the influencer allow you to see how many clicks those links generate and the actions users take after clicking (e.g., app sign-offs, or making a purchase).

Tech-driven transformation: Platforms leading the change

Influencer marketing platforms offer centralised marketplaces where brands can access a diverse pool of influencers and negotiate pricing based on standardised criteria. According to Decoding Influence, a significant 67% of surveyed brands express a preference for collaborating with influencer marketing platforms. This preference stems from the platform's ability to streamline collaboration, facilitate coordination, and leverage advanced technology seamlessly. In fact, technology now serves as a pivotal enabler across the entirety of the campaign lifecycle, orchestrating seamless collaboration from initial negotiation through to payment. 

Key tools in influencer marketing platforms

• Negotiation and contract management tools: Influencer marketing platforms with built-in contract and negotiation tools to streamline communication, mitigate risk, and smooth campaign execution, fostering stronger brand-influencer partnerships through transparent negotiations.
• Real-time campaign briefing integrations: Real-time platforms replace static documents with a collaborative space for brands and influencers to share updates, manage expectations, and even co-create. This fosters teamwork, agility, and stronger relationships, giving brands a competitive edge.
• Analytics and reporting tools: Advanced analytics provide insights beyond likes and shares, revealing demographics, engagement quality, and conversions. This data empowers brands to target the right audience on the right platform at the right time.
• Social listening platforms: Social listening aids in tailoring marketing strategies, collecting competitor data, assessing customer experiences, and addressing potential PR crises. It also uncovers collaboration opportunities, enhancing reach and brand credibility.
• Payment and invoicing solutions: Payment and invoicing solutions streamline financial transactions, ensuring influencers are promptly paid. These platforms offer user-friendly interfaces with automation features, minimising errors and delays and reinforcing financial integrity and confidentiality.

A note to brand marketers

When choosing between traditional, digital, and influencer marketing, perhaps the answer lies not in a binary choice but in a strategic approach. Here are key considerations for brands.

Target audience: Traditional advertising throws a wide net, reaching a broad demographic on television, radio, and print. Influencer marketing allows laser-focused targeting based on demographics, interests, and online behaviour. 

Campaign goals: Traditional advertising excels at building brand awareness through memorable visuals and mass exposure, while influencer marketing drives engagement and conversions with interactive content and targeted calls to action. 

Engagement: Traditional advertising offers limited interaction, relying on a one-way message broadcast to a passive audience. Influencer marketing fosters two-way communication, allowing brands to connect directly with consumers and build relationships. 

Beyond these core considerations, remember:

Budget: Traditional advertising can be expensive, especially for national campaigns. Digital & influencer marketing offer greater scalability, allowing brands to adjust their spending based on performance.

Brand Fit: For influencer marketing, ensure the product or service aligns naturally with the influencer's content and audience. A mismatch between brand values and influencer persona can backfire.

Final thoughts: complement, not replacement

Influencer marketing's capacity to authentically target audiences and deliver impactful campaigns at a competitive cost underscores its potency, placing it in direct competition with traditional marketing methods. However, the debate surrounding its potential to replace traditional marketing hinges upon a brand's strategic approach to its initiatives. Factors such as the brand's target audience, overarching objectives, and allocated budget play pivotal roles in determining the extent to which influencer marketing can supplant traditional methods. Equally critical is their openness to experimenting with different marketing tactics. Rather than viewing influencer and traditional marketing as mutually exclusive, brands stand to benefit from adopting a fluid approach that incorporates both, leveraging the unique strengths of each to effectively reach and engage their audience.