How to Measure the Influencer Marketing ROI
Influencer marketing occupies a secure spot in the marketing budgets of many a company. In this post, we’ll talk about the proper key performance indicators, or KPI, and look at why you need to determine their merit. We also differentiate between quantitative and qualitative statistics. Finally, we discuss where the boundaries lie and why it’s often difficult to not only track influencer marketing ROI but to also meaningfully evaluate an influencer marketing campaign.
Influencers appeal in particular to a younger demographic. These influencers are often Instagrammers or YouTubers, though occasionally, they can be the traditional blogger, too. Perhaps you’ve suggested trying an influencer marketing approach at your company. Marketing budgets don’t just get bigger though, and let’s face it, influencer marketing costs money. Rather than take on your idea, the money gets redistributed.
Recently, your colleague from accounting has decided to play Devil’s Advocate. He suggests that you come up with some facts and figures that would justify paying for an influencer that he can give to management. He’s interested in the influencer’s return on investment, or ROI. Consequently, you’re tasked with trying to measure the success of an influencer marketing campaign to see if your company can move forward with this type of strategy.
Influencer Marketing KPI: Multipliers to Success
In order to measure the success of an influencer, you must first get the correct figures and data in order. Furthermore, you should meaningfully define when the measurement of the results would ideally take place.
It would be most optimal if you could work with the influencer long-term to see the effects of your efforts. Just because your product doesn’t sell on the first day of the campaign, doesn’t mean that it has failed.
Initially, your campaign should attract the attention of your target audience and increase the reach of your brand. Then, your next step is to build trust in your brand and anchor your brand message in the heads of your site’s visitors. Only then is it more likely that fans will become clients.
What Numbers Do the Decision Makers Want to See?
Whoever gives the results of the influencer marketing campaign to the management team’s decision makers should know who is reading the report. On one end of the spectrum, there is the Executive Director, who is strongly focused on the numbers and who most prefers to receive financial ratios, like ROI. For them, the campaign results should be sensibly summarized; any superfluous details should be kept out of the report.
This type of manager presumably wants to read about key performance indicators, like cost-per-engagement, or CPE. CPE sets the budget for influencer marketing in relation to the resulting “likes” and comments. In this way, the costs-per-engagement for an influencer marketing campaign can be easily compared with the costs-per-engagement of other types of marketing strategies.
On the other end of the spectrum, you’ll find the manager. They want to understand the whole picture. For them, the connections between the figures are more important than the individual numbers. Your report should emphasize this aspect of your influencer marketing campaign.
What Are My Goals With Influencer Marketing?
If you would like to meaningfully evaluate the success of the influencer campaign, then you should first define your goals.
For example, you might aspire to the following goals:
- A greater familiarity with your company
- A greater reach of your company’s messages
- The building of your brand images, or your brand awareness
- The generation of leads
- A rise in conversions and sales
It’s important to strategically align your influencer marketing campaign with your desired goals. Ask yourself, does the campaign serve to give the company or brand a more updated image? It’s not as important that your company’s sales grow because of the campaign, if that isn’t your initial goal. Later, when you’re feeling out new distribution channels, you can then look at how well the product sells before and after your work with the influencer.
How to Track the Success of Influencer Marketing
Tracking influencer marketing success metrics is a fairly simple matter. Usually, you can ask your influencer to set a tracking link in order to evaluate who came to your landing page from the influencer’s post. The influencer can offer their fans a special rebate or promo code that’s associated with their campaign specifically. All of the purchases that come from the people who use this campaign rebate code will be traced back to the influencer.
The code can function in a similar fashion when the campaign concerns itself with building awareness for your website or your online store. The influencer distributes the promo link that leads to the desired landing page to their followers. Thus, the corresponding access to the site can be attributed to the influencer.
Which KPIs for the Influencer Marketing Should Be Considered?
Possible KPIs that you can use to measure the marketing success of the campaign include the following:
- The number of posts by the influencer
- The value, quality and authenticity of the content
- The reach of the influencer’s posts (the impressions)
- Engagement or interaction rate
- Relevant comments and other types of interactions
- Conversions, i.e. Sign-ups for your newsletters, corresponding sales
- A rise in followers and fan counts on your company’s channel
- Brand effects, i.e. Trust, acceptance
At first glance, a few of these metrics seem clear and unambiguous. However, if we take a closer look, we see that the devil is in the details. High-quality content does little for your influencer marketing ROI if the influencer isn’t able to reach or convince their target group.
It would be equally unfortunate if the influencer did reach their target group, but few, if any of the people in the group fit your company’s target market. This could be due to the fact that the themes of your content and the themes of the influencer’s content aren’t as closely aligned as you had originally presumed.
You might also discover that the influencer actually has relationships with too many companies, and because of this, they have lost their credibility. This shows how important it is to think about which influencer you approach before proceeding with your influencer marketing campaign.
In this respect, it’s best not to rely on agencies or online platforms alone. Rather, you should look at the influencer, their content and the interactions they have with their fans before making your final decision.
Measuring Influencer Marketing ROI: How Do I Analyze the Campaign?
Typically, a company follows a step-by-step process when it comes to conducting its analysis. There are three main points in the evaluation.
The first thing to look at is the influencer’s accounts. How many fans and followers do they have and how high is their engagement rate? Do you see numerous “likes” and comments, and when a post is shared, can you tell if the target group notices the content? The sharing of content (as well as the written comments) has a higher value than a single “like” does. Finally, you should look at both the reach and the influence of the influencer. The fee you pay to them should be based on this, so that it’s a fair trade for both sides.
Next, you want to analyze your customer accounts. Did you raise the number of fans you have on Instagram, YouTube or Facebook because of the campaign? Provided that you did not carry out other campaigns at the same time, you should be able to determine and interpret the comparative values of the campaign fairly simply and concretely.
Last, but not least, are the sales. What effect did the influencer marketing campaign have on your sales? Were the influencer’s fans merely fired up about their funny posts, or did they actually buy the recommended products?
If you’d like to more fully review the results of the influencer’s performance, analytic tools, like Google Analytics or Facebook Insights can help.
Measuring Influencer Marketing ROI: Practical Examples
A charge card account is an abstract product – much less attractive for advertisers than, say, jeans – and can be more difficult to translate into meaningful pictures or to create an emotional charge for. Nevertheless, American Express manages to do just that in its influencer marketing campaigns.
By anyone’s standards, AmEx spends some serious cash on its advertising budget. According to Business Insider, AmEx spends just under $3 billion a year on its ad budget, with a good portion of it going to its influencer marketing campaigns. Much of its influencer marketing strategies center around its Instagram and Twitter accounts. Savvy partnerships with celebrities, like Billy Joel, fashion blogger Chiara Ferragni and micro-influencer Corrine Stokoe have certainly produced results.
AmEx’s influencer marketing ROI is quite high: The company gets nearly four million engagements from its influencer marketing campaigns. What sets AmEx apart is its ability to create meaningful images in its customers’ heads, despite having what might seem like a dull product on the surface. AmEx does this by emphasizing the luxury lifestyle that comes with having an American Express account.
One other thing worth noting about American Express’s influencer marketing campaign strategies is that the company tries to work with at least some of its influencers long-term. Known as the #AmexAmbassadors program, this program makes AmEx a viable case study for firms that are interested in observing how this marketing strategy can play out over a longer period of time.
Credit card companies aren’t the only companies that have gotten great benefit from influencer marketing campaigns. Vacation travel and the products and services that support travel offer companies an excellent platform on which to build an influencer marketing campaign.
Case in point: Airbnb. A very successful influencer marketing campaign remains one of the key reasons why Airbnb has had a nearly meteoric rise to the top.
It started in 2015 when singer Mariah Carey booked a stay in one of Airbnb’s Malibu properties. Company bosses at Airbnb made contact with the singer and set up an influencer marketing campaign.
Carey was an ideal influencer in terms of the clout she brought to the campaign. With more than six million followers on her Instagram account, it was easy enough for the Airbnb campaign to gain traction.
One photo, which featured the singer at the Airbnb Malibu beach house where she was staying, garnered 45,000 “likes.” Carey made sure to tag Airbnb in the photo.
Another campaign featured Lady Gaga. The vacation-stay giant gave Gaga access to a $20 million estate in the city of Houston during Super Bowl 2017. A “thank you” for the accommodations by Gaga on Instagram went out to her 27 million followers. It also netted Airbnb plenty of press, including mentions in People and Vanity Fair.
By working with influencers, Airbnb was able to create 37 sponsored posts. The company’s engagement rate is around 4%, due in large part to these marketing strategies. In total, these efforts have netted over 500,000 comments and 18 million “likes” for Airbnb.
Influencer Marketing and the Future
In the next year, influencer marketing trends will likely change even more. However, it will remain an important part of the marketing mix for many companies. Since the beginning, influencers have become increasingly professionalized, and as a rule, consistently deliver high-quality content.
However, company bosses are also thinking more about how to up their marketing campaigns’ influencer marketing ROI. More specifically, they want to know exactly which ROI their influencer campaigns bring. In order to properly calculate this, it’s important to define the company’s exact marketing goals. If company bosses choose the right KPIs as well as the correct analysis tools, then nothing stands in the way of them accurately measuring their campaign’s influencer marketing ROI.
Would you like to delve deeper into this subject and learn more about which points are crucial to the success of your influencer campaign? Our influencer marketing series will shed more light on all of the important criteria: