How to measure ROI: return on influence
Introducing part three of our three part series covering the biggest challenges marketers face in influencer marketing. If you missed parts one and two you can read them here:
In this article, I will be considering the final key challenge – measuring the impact of influencer marketing, or return on influence. This is one of the most overlooked but crucial challenges, as without effective measurement there is no unlocking the true growth potential of influence for your brand.
So, why are people struggling with measuring the true effectiveness of influencer marketing, and how can it be solved?
In the dating context, this challenge is like the stage at which you need to decide “is this going anywhere?” Too often people deceive themselves into thinking a relationship has a future when in fact it’s just superficial and transactional. Discerning whether a partner is a good long term prospect requires paying attention to not just the obvious which is apparent right now (e.g. am I having a good time with this person) but also the less obvious which is likely to have a bigger impact as the future unfolds (e.g. how does this person talk about their parents, and what does that say about what kind of a parent they will be).
When it comes to evaluating whether an influencer relationship is really working, it’s equally crucial to consider both the obvious and the harder to measure factors. Like an iceberg, the bulk of the impact is in fact unseen.
Whether your goal for a campaign is top of funnel awareness or bottom of funnel sales, engagement statistics are most obvious and undeniably important. These include impressions/views, likes, comments, and related explicit interactions with branded content. While you can use industry benchmarks, it is highly preferable that you do the math and find out what these are worth to your business. How many impressions of branded content do you have to buy on average in order to get a sale? How much do you pay for these impressions through other channels? Answering these questions will give reference points from which the value of a given post can be estimated.
Less obvious and more important is tracking sales per post, as this grants a more direct measure of ROI. This can be done by sharing an affiliate or discount code link with influencers to append to their posts, allowing their audience to directly purchase the product. When setting up tracking it’s crucial that each influencer has a unique discount code (for attribution) and that the link for each post has a utm attribute identifying the post. Otherwise you won’t be able to tell which creative drove the results.
Least obvious but most important are the long term psychological and asynchronous impacts of viewing influencer marketing. Psychometric impact studies have found influencer ads to be 277% more emotionally intense and 87% more memorable than TV ads as well as having significantly raised intent to search, purchase, and share the product.
Much of this intent will eventually be fulfilled in ways that are virtually untrackable, as an astonishing study from Google found. Google discovered that “for every person who is clicking on the tracking link of an influencer video on YouTube, there are 4 more people who are not clicking but still download the (product) within four days after watching.” In other words, when looking at 250 videos with a collective 60M views, Google found that influencer marketing was 5X more effective than directly measured. This is the “untracked majority”, the submerged part of the iceberg where most of the ROI remains hidden.
This result is exciting but must be qualified. How much more effective your influencer marketing cannot be precisely measured without Google’s data and will certainly vary from this study. We estimating your untracked majority by observing fluctuations in overall sales through all channels during the first ~4 days following a post’s launch and comparing the size of the overall uplift with the measured sales. Assuming no other campaigns were active at this time, the gap between these two figures can give a rough sense of your multiple.
Like with a partner, it is critical to look past the surface features of a relationship to those hard to see yet clearly important factors for long term success.
Conquering the three challenges of influencer marketing
This piece concludes this three part series on the three biggest challenges in influencer marketing and how to conquer them. Links to challenge #1 (influencer selection) and challenge #2 (influencer collaboration) can be found here.
Building a relationships with an influencer is a lot like building a relationship with a romantic partner. If it were easy to find, build, and maintain a happy relationship, many more would be satisfied than we see today. And while we may more often see examples of unhappy couples, those who are clearly in love point towards the possibility of a great relationship if done right. Finding, building, and maintaining relationships with influencers is much the same. It is challenging, but if done right, it is transformative.
If you are struggling with overcoming any of these challenges, get in touch with Tailify at firstname.lastname@example.org.
Ian Randoph, head of product and R&D at Tailify
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