12. A Quick Guide to Starting and Scaling Influencer Marketing
- Rahul Dash Co-Founder, Purplle
- Nitin Agarwal Head of Growth & Revenue, Shopsy by Flipkart
In this snippet, Rahul outlines how brands can use influencers effectively, discussing the metrics and considerations for selecting the right influencer based on engagement, content type, and platform.
A decade ago, you’d think only a celebrity endorsement on the TV could scream “we have arrived” for a product. Scrolling through a tiny screen watching an influencer perform a fun skit about your new sunscreen launch now has the same effect.
Working with influencers who have built a dedicated audience can have an equivalent or even greater impact than vying for A-list names.
Most brands now have a dedicated influencer marketing budget, but it is important to understand where and how to use it.
This is especially true for D2C companies, who want to work with influencers for a visibility boost, but with so many influencers and micro-influencers creating content daily, they feel overwhelmed by choices.
How do you choose an influencer?
What is good engagement?
Which influencer is trending today? (arguably the most difficult to determine with the current growth of influencers).
To find the right kind of influencer, let’s go over another set of questions:
- Who is creating this content?
- How much content is being created?
- What is the target audience for this content?
- How does the target audience react to this content?
Relying solely on follower count is not an effective way to identify influencers. A better approach is to use YouTube APIs to assess engagement metrics on relevant topics.
An even more effective metric is to evaluate cumulative engagement over a longer period — such as six months or even a year, depending on the newness of your category.
During this process, you may encounter situations where you have to choose between an individual who has gained more followers in recent months versus someone with higher engagement but stagnant follower growth.
The general rule here is that more engagement is better, even if the number of followers is growing slowly.
If you are working in a regional market, you should find out the language/dialect spoken in the area you are targeting and then use a tool like Klug, which provides directional signals on the type of influencers that are getting engagement.
It provides information on the number and type of followers, number of views, and other basic metrics.
Since influencer marketing relies heavily on people, it's important to check yourself for any biases that may arise. Remain disciplined and do not target an influencer just because you like their content. Your personal preferences do not matter. Your only concern should be which content works with your target audience.
It’s especially important to remove any founder biases from this equation, as they may influence the decision-making process.
For example, a founder may say “My wife told me about this influencer, we should work with her.” This type of bias should be removed from the decision-making process in order to avoid potential failures.
When you’re choosing a channel, it may be tempting to use multiple platforms, splitting your effort will decrease your ROI.
When deciding on a channel, ask yourself these questions:
- Do I need this solely for branding, or is it for performance marketing?
- Will this primarily be content? (Which means WhatsApp will be out)
- Is it audio, video, or text?
- If content, is it long-form or short-form? (For long-form, YouTube is better than Instagram.)
Let’s use the example of Purplle to understand this. We were clear about focusing on content, which is why WhatsApp and a few other things were out. For content, we decided on video. This narrowed down our options to YouTube and Instagram.
At that stage of our journey, the company was still educating its audience about its products, which meant they needed long-form videos. Hence, we selected YouTube, with Instagram following on its heels.
Why YouTube over Instagram?
YouTube is almost like a superset of our target group who interact online with content. The target group is also active on Instagram. That’s a great set because I think YouTube gets about 400 million views a month, and about 40% of those views come from women, our target audience.
YouTube was large enough for Purplle to work with to drive ROI since they treated it as a performance marketing channel, not a branding one.
However, founders should be careful when selecting channels. Instagram is now getting a decent scale and may be on par with YouTube for many brands already.
Nitin offers a practical approach to scaling influencer marketing with nano and micro-influencers, detailing how to manage costs and optimize influencer collaborations for B2C brands.
When starting Influencer Marketing, we often want to work with the biggest names, but unless your product and service have also scaled, large influencers likely won’t give you a high ROI.
Known names can bring impact when you’ve scaled up, but nano and micro-influencers will give you more bang for your buck. Focus exclusively on nano and micro-influencers.
Initially, and even in mid-stages, nano and micro-influencers are what you must follow. Work with smaller influencers, people who have 10k-50k, or under 100k followership. Cherry-pick influencers based on their content types.
When influencers start doing too much, their user base quickly gets diversified and diluted, impacting your business less. Therefore, it’s important to go with very focused, narrow, or micro-influencers with good engagement.
For your first zero to 100 in a B2C focus, hyper-local influencers are super useful. You’ll spend more time finding them, but it’s important.
Engage with hyper-local influencers to get more iterative feedback and gain your first 100 – 200 users. After that, double down on nano and micro-influencers. These are folks with less than 50k followers.
Once you’ve cracked the initial bit, depending on your budget, you might want to get them to do a post, try out your product, and put out a video. This can be expensive, so focus on it in your post-100 user journey, not at the beginning, because you’re still figuring out what resonates, and you don’t want to spend too much money.
There are enough nano and micro-influencers out there. Work more with them and give your team a mandate to do barters or set a specific budget per campaign.
Otherwise, you might find that influencers ask for more than you can spend. Give your team clear guidelines: “You should only spend 5k per influencer.” You can do five influencer campaigns each month with a 25k budget. Maximize engagement and views, and make things clear and easy for your teams.
For 1,000+ users, unless you scale with 50-odd micro-influencers regularly doing something, you’ll be limited by scale. At that point, you’re better off with regular influencers, the big names with 100,000 to 200,000 users.
It’s very expensive, so refrain from doing this until you’ve done the hyper-local, micro, and nano engagements. Otherwise, you might not know what you want out of the site or how to scale post-10,000.
Running affiliate coupons also works well. Most influencers these days are well-versed in affiliate models, and if you have a high-value purchase, affiliate models can work very well.
YouTube influencers deliver terrific ROI with affiliates, especially for B2C industries. But YouTube influencers come at a high price point, so save them for when you’re scaling.
Initially, you might only afford about 10 YouTube influencers since they charge in lakhs. Aim to work with one YouTube influencer per month.
But remember, there’s nothing directly linking a YouTube or TV ad to app installs. YouTube will only show a fraction of the actual incremental installs you receive.
To measure its efficiency, look at your total spend versus total revenue, total signups, and total orders.
Rahul explains how automation and AI can help brands manage influencer relationships more efficiently, but stresses the importance of human oversight in handling the logistics and nuances of influencer campaigns.
After identifying your influencers and other relevant information, you’ll be faced with a long list of influencers and an even longer list of their videos that you would need to sift through.
This is where automation can come in handy to scout faster. AI can consume contextual data much faster, reducing a month-long process to just 10 – 15 minutes. You can categorise and profile influencers this way, and make decisions and conversations faster.
However, it’s essential to train your own brain on the data before training the AI. You need to ensure that the AI is replicating your thought process accurately, especially when it comes to understanding beauty or personal care products.
If you're just starting out, it's best to figure out your own "dictionary" of category tags before relying on technology to replicate it for you. You can do this with a few profiles, but if you are serious about Influencers, the deeper you go, the better.
At Purplle, we created a proprietary dictionary that allows us to analyze any text related to beauty available on the internet.
We went through over 60 influencer profiles and went through each of their videos to generate a certain profile for that influencer. Then we basically automated this entire profiling at scale with AI.
But it’s important to accept some harsh truths. Influencer marketing is less about intelligence and more about logistics.
Once you have figured out what channels, what influencers, profiled them, it is an unending stream of negotiations, bartering, and setting up meetings — in other words, influencing the influencer.
You will need a team of relationship managers to take this up since many of them will be individually managed and come with diverse requirements.
At the end of the day, you’re dealing with a person and not a dashboard of a Google campaign. Your relationship manager needs to send products, track returns, check how the product fits with the script, and handle any related logistics.
Relationship managers are usually inexpensive entry-level executives, but you might feel tempted to outsource some of it. If you go down that road, expect inefficiency similar to any other outsourced logistical play.
When it comes to paying, there is no system for assigning prices to a particular influencer, as the information about them is opaque.
The most structure you can get here is if you categorise as Mini, Micro, or Mega based on the level of influence they have in their chosen social universe and assign pricing to each tier.
One heuristic to determine what to pay is dividing the number of promised views by the fee. This helps you estimate your cost per view and take a call on if the value fits for your business.
If your CTRs increase after creating a few videos, use that as a guideline and start testing. In three to six months, you will be able to confidently say, “This works, and this doesn’t.” At this point, the relationship manager will step in and initiate commercial discussions.