We are delighted to present an exclusive piece by Han Yan, Chairwoman – Top Social India. Han is a senior business leader, executive manager and an astute entrepreneur with more than 19 years of extensive marketing and business management experience. As Chairwoman of Top Social India, she will lead Top Social to provide world class strategy and isights-led communication solutions to Indian brands.
She has been closely associated with the travel and tourism industry for more than a decade, having worked closely with Air China. She has also held the prestigious position of Chairman, Corporate Business, for Star Alliance in Beijing, China , which has close to 28 airlines, that were managed by her.
Influencer Marketing – one of the most buzzed concepts in modern day businesses – has been turning out to be the most effective ways of acquiring customers and clients. Almost every brand manager is looking to explore it — if he/she hasn’t already. Influencers are nothing but the people with an audience relevant to the brand. The followers of these influencers trust, respect and listen to them because of associated credibility and common interests.
Influencer Marketing: Great influence for brands
When brands associate with the influencers, they are able to leverage the popularity, reputation and trend-setting power of these opinion leaders, as the content created by influencers doesn’t come as advertisements but as relevant pieces of information. They cut through the clutter and give brands the share of attention of consumers.
If we look at the recent trends, traditional advertising in its original form is dead. It is all content now’– content which can capture the attention of audiences by giving them some points of association. Influencers are in the business of content. Their audience has a strong connect with the content that these influencers create, and brands are collaborating with them to generate more and more relevant content for themselves.
The influencer marketing industry
The global influencer marketing industry is being valued at USD 6-7 Billion in FY 2018-19, with some reports even predicting it will reach USD 10 Billion by 2020. However, it cannot be denied that the Indian influencer marketing industry is still in its infancy. Due to the unorganised nature of influencer marketing industry in India, it remains difficult to ascertain the actual size of the industry but the influencer marketing expenditure in the overall budget is increasing every day.
Influencer marketing in India may take 25% of marketing budgets by 2020
If we look at industry data as well as our experience with the international brands, currently brand managers are spending about 10% of their digital marketing budget to influencer marketing initiatives. As marketers are recognizing the effectiveness of influencer marketing, this share is increasing at an increasing rate. We expect that by 2020, brands will be spending as high as 25% of their marketing budgets on influencer marketing for brand building.
The pioneer sectors
In India, Fashion, Beauty, Tech, Internet Services and Food are the pioneers of experimenting with influencer marketing in their marketing campaigns. Seeing their success, industries such as Health, Financial Products and Edu-Tech too are catching up.
Micro influencers – engaging, credible, cost-efficient
The rise of Micro influencers (people with a follower base of 10k-50k) has been a massive driving force in modern influencer marketing. They give brands an opportunity to tap into an existing community in a niche. This audience is already highly engaged with the influencer, giving credibility to any message that is shared through this channel. Though Micro Influencers have far fewer subscribers than macro or celebrity influencers, engaging them for brand promotion is more profitable. Research shows, they are 6.7 times more cost efficient per engagement. Brands can run trials or A/B testing with them without losing too much money. Thus, resources are channelized in the most efficient manner.
Micro- Influencers understand the importance of authenticity and they often nurture their community and followers by creating engaging content in an approachable way, thus leading to having an average engagement rate of 7.6% when compared to 5.3% of macro influencers. Industry reports indicate that about 77% of the micro influencers publish content daily and 48% publish it twice a day which conveys that they are regular in their communication with their audience.
Criteria like mass following and big numbers seem to be fading away in importance; brands are now increasingly looking for a more personal and intimate approach to their campaigns, and expect the same from the content creators and influencers they collaborate with. This kind of approach assists brands to establish TOM (Top Of Mind) recall in the minds of their consumers.
We can see a shift in the industry, adopting a central, collaborative and a structured way of communicating with target consumers, leaving the traditional ways of communication behind.
Nano influencers too
There is even a new category called the Nano influencer (people with a follower base of 1k-10k) who may have less reach, but a highly engaged audience base and their recommendation is akin to that of a friend which is valuable for a brand.
So, Influencer Marketing as a whole is playing a crucial role in delivering brands’ communications to their end-consumers. Where Mega and Micro Influencers ensure reach, Micro influencers derive engagement for the brand. At the same time, Nano Influencers bring loyalists. Whenever brands are developing strategies for their marketing campaigns, they should choose a combination of macro, micro and nano influencers to get the best results. TopSocial, an expert in influencer marketing, has been successfully doing this in China, and now intends to replicate its success in India.