Top brands are investing more in influencer marketing...and it’s paying off.

Kelsey Formost

19 May 2020 · 2 min read

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Top brands and companies are investing more of their budgets in influencer marketing, and for good reason. The fact that physical advertising has been all but eliminated puts a bright spotlight on what most marketers already knew: digital marketing, and especially influencer marketing, is the most effective way to reach a target audience.

It’s important to note that brands were increasingly spending more of their advertising budgets on digital initiatives before shutdowns began, but the pandemic certainly accelerated the process. In fact, before the surge in digital content consumption, influencer marketing had an 11X higher ROI than traditional advertising. That number is likely to grow and stabilize at an even higher rate, even after stay-at-home orders are lifted.

Looking at the data and the efficacy of influencer marketing, it's abundantly clear that certain digital marketing trends are here to stay. Not just because of immediate necessity, but because they’re effective.

In the most recent episode of our Tagger Insights series, growth marketing expert Simon Yi dove into what's working best for his clients right now, and perhaps more importantly, why certain strategies are succeeding more than others.

“More people are spending time online than ever before. Everyone’s home and watching a screen...there’s a lot of people that can be reached,” says Yi. And not only can you reach more viewers at the moment, but you can do so for a much lower cost. “Specifically when it comes to social media advertising what we’ve noticed is that the cost to reach people is actually going down...it’s cheaper to reach more people.”

The extreme and abrupt shift to a stay-and-work-from-home culture has put brands’ advertising initiatives under a microscope, and many have found they’re behind the curve when it comes to their digital strategies. With no physical job or school commute, and very little - if any - exposure to the outside world, the only place where companies can reach consumers is through digital channels.

And that’s not necessarily a bad thing, because Influencer Marketing isn’t only effective in terms of sales. Brands now have a unique opportunity to employ social listening to hone in on the authentic conversations that matter most to their target demographic and pivot their messaging accordingly.

In fact, digital marketing allows for a much more accurate and dialed-in approach to delivering value. Brands now have a wide variety of data points at their disposal that they’d never be able to see if they spent that same amount on, say, a physical billboard. With this scientific approach to data gathering, brands can cultivate a much deeper understanding of their audiences’ desires, behaviors, and affinities.

The ability to get granular and specific is the crux of why influencer marketing is so much more successful than traditional advertising. It comes down to one thing: relevance.

When done right, influencer marketing allows brands and companies to cultivate genuine connections with their communities by presenting them with content that is relevant to their needs and wants.

“A lot of the work we do for clients is direct response related. But what people fail to realize is that transaction doesn’t happen without trust,” Yi continues. “What influencer marketing has really done for the industry, now more than ever, is give a microphone of authenticity to brands through the influencer’s platforms. Now is the time to build trust.”

See our full interview with Simon Yi below for more insights on digital ad spend trends, and how influencer marketing is helping businesses continue and grow.

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