When Vine was shuttered last year, a large portion of the blame was assigned to the company’s inability or unwillingness to listen to the community of creators and foster their loyalty. Stories surfaced soon after it was shut down that a number of the top creators on the app reached out to Twitter to talk about what it could do to keep them active on the platform, including opening up a payment system to help them produce content that would continue attracting an audience of loyal fans.
It might seem odd that a bunch “nobodies” would essentially hold out their hands and ask for money in addition to preferential treatment from a large company in order to remain loyal. You might think they need the platform more than the platform needs any individual user, or even a handful of popular people.
That’s not the situation social networks find themselves in in 2017, though. The dynamic is instead one that favors the individual influencer and puts the power in their hands, meaning the companies that control these social distribution platforms are dependent on a small number of “influencers” to maintain whatever status they have as being hip and popular or help them reach that level.
It’s this situation that is at least in part behind the news that Snap, which just reported some troubling numbers about growth in the Snapchat user base, is not only considering a substantial redesign of the app to ease onboarding but also paying top creators to keep using it. Snapchat does not want to follow Vine into the great beyond and is willing to write checks to keep people happy.
Influencer Marketing in 2017
According to a study released in December of 2016 by content agency Linqia, 86% of marketers were already engaged in some sort of influencer marketing effort and 48% reported plans to expand those budgets in 2017, the latest in a series of spending increases.
So why is influencer marketing so hot right now?
According to a MediaKix study last year, people are spending almost two hours a day on social media. And social media is increasingly being split into two feeds: 1) The organic feed of updates from friends and family and 2) The paid ads from media companies and other brands that interrupt the stream of updates from the first category.
The reasons for brand updates being given less preferential treatment in the various algorithm-based feeds are many, but the result is that the content marketing programs companies spent years building up aren’t seeing the return on investment they did, say, five years ago. That combined with the rise of ad blockers online and on mobile and it’s clear that people don’t want to be marketed to and the distribution platforms currently dominating the media world wants you to pay to reach people.
That’s coincided to a large extent with the rise of the social media influencer, an individual who attracts a large following on a social platform through unique, original and (usually) wholly creative content. It can be beauty tips, it can be video game reviews, it can be technology updates. It can be on literally any topic.
So, in order to have their marketing messages seen by a highly influential audience, brand marketers turn to those influencers. There are no end of niche agencies that manage databases of influences of all kinds and are more than happy to do the research for a brand and then make the connection, for a substantial fee. The ROI may still be questionable, but the reach is impressive. Ad agencies are even adding influencers to their teams to try and tap into their insights about the audience and what attracts them.
Buying Platform Loyalty
One of the big issues with influencer marketing is that the ground always seems to be shifting. Because these influencers make a living on their image of being hip and cool, they want to be on the platforms that are seen as hip and cool. What those platforms are, though, changes over time. Platforms jockey for position, often by working to attract talent away from other platforms, including by paying them to make that switch.
Here’s how some of today’s top social platforms are offering money and features to influencers to keep them happy and creative and away from other apps and networks.
YouTube doesn’t pay creators directly but it has revamped its Creators Site after it acquired FameBit, a creator/brand connection company. It also added functionality to the Studio app to make creation and publishing videos easier. That being said, it hasn’t been transparent about changes to content and advertising policies, leaving many creators concerned over sudden drops in revenue.
Instagram does not pay top users to keep using it, but it may not need to. It was identified last year as one of the top two platforms for influencers and one of the two, including YouTube, influencers said they were most likely to leave Snapchat to focus on, an exodus powered by the ease of making money on Instagram. Influencers posting branded content have tools available that allow them to easily disclose those paid relationships.
Facebook is the only platform more popular than Instagram among influencers, Facebook has worked hard to keep influencers happy as well as the brands that pay them, and pay Facebook. This past March it expanded the availability of branded content to more Pages and Profiles. So influencers who post paid content can tag that company as a form of disclosure. It also added a feature that allows brands to pay to boost an influencer’s post directly, without the brand page having to share it in its own post first.
Twitter has a multi-faceted relationship with influencers and creators. While it certainly dropped the ball when it came to Vine, it has made other moves that show it gets how important a good relationship with that community is. It has touted the effectiveness of influencer marketing on the network and owns Niche, an agency that facilitates connections between brands and those influencers, so it has a vested interest in this category growing. Late last year it opened up revenue sharing for video creators and has been experimenting with ways for fans to pay top Periscope creators through engagement.
Musical.ly, just sold to a Chinese tech company last week for a reported $800 million, quite the price tag for an app that didn’t exist three years ago. Like Periscope, fans can “gift” creators actual payments. Brands have been working with top creators on that platform for a while now and is said to be exploring other monetization efforts that would benefit both the company and the influencers eager to reach its teen audience.
Pinterest was identified as one of the top apps for female influencers, who were finding more success there due to the demographics of that network. Recognizing that it had a group of talented “pinners” who could help brands create engaging content it brought those creators into the Pin Collective it launched in October of 2016. That system allows marketers to work directly with influencers, who are paid for their efforts.
Medium has pivoted its business model more times than you can count in the last few years, most recently introducing the Partner Program – first to just a few and recently to everyone – that lets users put select posts behind a membership paywall. Unlike a previous incarnation, that membership is not publication specific but for the whole site, with publishers getting a cut based on the engagement of each post they restrict access to.
Brands Pay Multiple Times
The cost of actually working with an influencer goes beyond what that individual may charge to reach his or her audience. Roughly 70% of brands say they repurpose influencer content and 36% report doing so via paid ads. So the actual cost of influencer campaigns includes some combination of the following:
- In-house cycles spent developing the creative brief
- Paying a relationship agencies to find the “right” influencer for a campaign
- Paying the influencer’s core branded content fee
- Paying for repurposing that content in ads either on social networks or in other media
It obviously remains to be seen whether or not Snapchat can change its trajectory. Since it IPOd earlier this year the stakes are higher than ever for it to succeed, but it needs to not only get past the “I don’t get it” problem that has many delete the app shortly after trying it out and to increase its attractiveness among influential creators. Snapchat Discover allows select media brands to not only create unique content but to sell ads against that content, with the revenue split with Snap. It seems the company could be pondering something similar for influencers.
Money only buys loyalty for as long 1) The spigot keeps flowing and 2) Someone else doesn’t offer a better deal. That means there’s a very small window for Snap to get in on this game and leverage its position to achieve any sort of success.
Chris Thilk is a freelance writer and content strategist who lives in the Chicago suburbs.