Micro and nano influencers — influencing the influencer marketing

‘Collaboration with social media influencers’ is the new buzzword in the marketing strategy of brands.

Other than going for traditional media, brands have been signing up both big and micro influencers for amplification of their content across social media platforms.

The demand of influencers has been so high in last one year that the segment, which was earlier limited to food and beverage, technology and tourism, has now popped up across every category; there are now specialised micro influencers for every category of products.

The high demand has also given birth to standalone influencer marketing agencies. And not only brands but traditional media agencies and publishers are also tying up for amplification of content.  

According to rough estimates, brands are spending over Rs 200 crore a year to hire the services of influencers for digital platforms.

Yan Han

“The increasing scope of work has created opportunities for technology-rich platforms to lead the way and consolidate the highly fragmented industry. It is about the efficiency and the scalability of the undertaken project, which require the right set of marketing channels, right influencers, and right content to position the brand among the right set of audiences at the right time,” Yan Han, Chairperson, TopSocial India, said on the boom of influencer marketing agencies in India.

Chandni Shah

Chandni Shah, COO, Social Kinnect, said the popularity and the scope of influencer marketing in India is seeding the birth of influencer marketing agencies and it is going to grow in coming years.

Priyanka Gill

“The already set up creative, digital and media agencies work with influencers only to further brand appeal. Working, managing and collaborating with influencers requires a different set of DNA. These agencies work with brands to develop the narrative, define objectives, identifying influencer option territory and budget wise, creating a bespoke image of the brand,” said Priyanka Gill, CEO and Founder, POPxo.

Shradha Agarwal

Shradha Agarwal, COO, Grapes Digital, said the rise of the agencies started some years back due to Twitter trending, where access to hundreds of micro twitteratis was required and only a few had the database. Now that database is easily available and hardly a few clients ask for trending on Twitter; everyone has moved to quality content on Instagram or YouTube. And finding Instagrammers or YouTubers is definitely not an issue for any agency.

Kratika Raghuvanshi

Kratika Raghuvanshi, CEO of socioinfluencer.com, said that by partnering with the right influencers, brands can create conversations that relate to their target audience. And to find that right set of influencers, they either do it manually or through a platform or an agency. And, the ROI of influencer marketing is 11 times more than traditional digital marketing.

Samar Verma

Samar Verma, CEO and Founder, Fork Media Group, said while the market will witness a lot of influencer marketing companies mushrooming, most will become irrelevant as the ecosystem progresses from trading to more creative, data and analytics-driven.

Scope of influencer marketing agencies

Brand managers and marketers are recognising the value of influencer marketing as an effective and cost-efficient medium to communicate with users and create the desired impact.

Brands have understood that influencer marketing involves only a fraction of the cost as compared to other means of advertising. Also, it is a credible way to lend a third-party voice to a brand. Millennials rely on reviews before they buy. With influencer marketing, reviews are in-built.

“The trust and loyalty that the followers have with influencers is a phenomenon that brands look to leverage to increase brand awareness and, increasingly, drive sales too. This has created a fertile ground for influencer marketing to prosper with immense potential for credible platforms that bring efficiency and accuracy in marketing,” Han said.

Verma said influencer marketing will definitely evolve to newer models such as being more data-driven and commerce coming in fairly strongly but will be a definitive choice of the marketers in the near and long-term future.

Agarwal said the scope of these agencies are limited till they evolve constantly keeping in mind the need of brands and create unique propositions in the market that no one else offers.

“From the perspective of agencies, we need to be on our toes to offer the above to the client and meet the changing demands of the evolving social media. For example, now people are not looking at YouTubers or Instagrammers only. I have a lot of brief from my client to find TikTok and Quora influencers,” she added. Grapes Digital has BlogWeet, an influencer marketing agency, as one of its arms.

Influencer and agency partnership framework

The industry is unorganised when it comes to associations and partnerships. Since most influencer marketing efforts are focused on campaigns, influencers are partnered on a short-term basis. Only a few brands are now exploring long-term partnerships as well. When collaborating for the long term, brands could restrict influencers from working with competitor brands or even a particular category. A long-term association can last anytime between three months to a year.

“A lot of celebrity and macro influencers have an exclusive partnership with platforms and the contract defines the tenure with the influencers, but it is usually on a year-on-year basis. The agency managing the influencer exclusively plans the campaign calendar for the influencer, locks in venue for the shoots, etc,” said Gill. POPxo has its own influencer marketing platform Plixxo, which works with more than 37,000 influencers in more than 100 towns across India.

“Exclusive partnerships with influencers are based on brands’ requirements. To maintain exclusivity, long-term associations really help to set a tone for the brands,” said Shah.

Social Kinnect has an in-house influencer outreach team, which has executed some of the biggest influencer marketing campaigns for brands such as Hotstar Premium, FBB, Ariel, WLS, etc. 

The long-term partnerships offer brands relevance, trust and brand affinity. As influencers devote more blog posts or more Instagram posts to a specific company, their faith in the brand becomes more visible, said Raghuvanshi.  Socioinfluencer.com prefers to work with influencers on a long-term basis exclusively and no commission is involved.

The partnership also depends on the category of influencers. If you look at a Bollywood, TV or a mega social celeb, they all are tied up with some celebrity management agency. Other influencers can be approached by anyone via DMs.

“The rise of influencer marketing has flooded the market with options and with no fixed format. So we all think that there are huge cost markups when there are multiple agencies in between,” said Agarwal.

What sort of commission is involved in such partnerships?

Verma said influencers typically have a base price, which is then marked up depending on the scope of work and value being driven for the brand for such partnerships.

Due to the unorganised nature of the industry, a lot of agencies are taking hidden fees or commissions from the influencers’ end by overcharging the brands or paying less to the influencers, said Han.

Explaining how the partnership at Social Kinnect works, Shah said, “Long-term associations with influencers is a case of bulk-buying of their inventory, which would bring down costs and ensure the brand the best cost. In the case of niche influencers, compensation operates on a case-by-case basis. This depends on deliverables, type of content and, of course, the number of followers and engagement. Sometimes, an influencer could have a significant amount of followers, but very low engagement on each post. So of course, the commission would depend on the ideal balance between engagement and followers.”

For all the services like getting business to influencers, paperwork, payments and client servicing, agencies charge an amount that is added to the overall cost of the influencer floor rate, said Agarwal.

Is the market full of the same set of influencers?

Why do majority of brands want to go with the same faces of influencers that other brands are choosing without understanding the fitment of an influencer’s personality with a brand?

Brands and agencies were tapping the top of the pyramid, which is the obvious choice when they had just started off, and were going with the same set of influencers. The brands that are today fairly evolved in the space of influencer marketing are finding their gold at the bottom of the pyramid. The smart marketers are using the entire pyramid to drive different objectives, said Verma.

In the world of influencer marketing, marketers have understood that the ‘one-size-fits-all’ does not apply. Agencies are also modifying their strategy and are creating campaigns with a mix of macro, micro and nano influencers. Marketers are willing and open to partner with influencers other than the same set of names, said Gill.

Raghuvanshi said that the influencer community still has significant scope for growth, and that isn’t limited to bloggers or fashion stylists’ content creators. Experienced professionals from different industries command high social media value.

Upcoming business opportunities for agencies

Influencer marketing is said to redefine advertising in the coming years. From being an arbitrary type of marketing to now becoming a legitimate form of marketing, it has compelled even the biggest brands today to set aside large budgets.

There are a lot of unexplored business avenues in India with the boom of data and penetration of social media apps. In the future, the market will witness influencer marketing being used in tier II and III cities and it is a big opportunity for both brands and influencers, said Han.

With platforms such as Facebook, Instagram, Twitter, TikTok, etc, realising the potential of influencer marketing, it is quite possible that we will start to see platform-based innovations, said Shah of Social Kinnect.

She added that agencies also need better assessment tools that give a detailed breakdown of influencer followers’ demographics, an understanding of their engagement rates, as well as the ability to judge the quality of the relationship they have with their followers.

Other than that, influencers should be incentivised on how their content has performed.

“Influencer marketing needs to be looked at as being deeply synergistic to your overall content marketing goals. Data to understand content trends, relevant influencers, identification of a new set of influencers, semi-automation of content and deeper analytics would be some of the trends we would bet on,” said Verma.

How influencer marketing agencies could be at the top of their game

With rapidly emerging technology and opportunities passing at a moment’s notice, a marketing agency must always be on its toes to stay at the top. Being up-to-date with latest developments in the industry, recognising trends and capitalising on them, understanding brands’ core proposition and giving them the most apt influencers are essential for any agency to be successful in such an environment. 

“Agencies should strive to create a transparent ecosystem where brands and influencers can interact without doubting the information that they receive from both ends,” said Han.

Today a client expects automated tools for the right selection and analytics, the perfect creative approach to use influencers and ROI for the marketing objective on sales from the agencies. 

Agencies need to have credibility in reporting, result-tracking and matching the right influencer to the right brand. Other than that it is expected to understand the brand thoroughly, including its tonality, objectives, voice and positioning. 

Apart from that, agencies are ought to provide brands with influencers who genuinely have a good engagement rate, deliver the campaign flawlessly and on time, choose influencers who can help brands get as close as they can to the ROI expected and strategise on the brand campaigns.

Raghuvanshi, emphasising on delivering quality content, said an influencer marketing firm should have a broad bench of influencers.