disclosure killing influencer marketing

Is effective disclosure killing influencer marketing?

Falling engagement rates hint that disclosure is killing influencer marketing but figures mask best practice results pointing, instead, to poor influencer advertising.

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Last month the Competition and Markets Authority (CMA) - the UK watchdog responsible for consumer protection - announced an investigation into influencer marketing practices.

As part of the investigation it wrote to a range of social media influencers to gather more information about their posts and the nature of the business agreements they have in place with brands.

The CMA investigation is considering the extent to which influencers are clearly and accurately identifying any commercial relationships, and whether people are being misled. If the CMA finds practices that break consumer protection law, it can take enforcement action.

Disclosure killing influencer marketing?

Is effective disclosure killing influencer marketing? On the face of it the figures appear to confirm it does. But the figures point towards the perils of influencer advertising and mask the benefits of pure influencer marketing.

CampaignDeus, an independent influencer marketing benchmarking and measurement outfit*,  has produced some interesting research on Instagram posts.

It found there is a significant negative variance when using an admarker such as #ad or #spon on paid-for content versus organic content. The variance widens depending on the admarker used. The most popular admarker is #ad with over 60% of marked paid-for posts containing this hashtag.

The #ad admark also has the lowest negative impact on engagement rate. Instagram's Paid Partnership fares the worse. This tag reduces engagement rates by over 30%.

Further, average engagement rates on brand sponsored posts decline as account sizes grow.

The drop-off between brand sponsored and natural influencer posts increases as account sizes grow.

disclosure killing influencer marketing

Disclosure killing influencer marketing: Research by CampaignDeus shows a drop off in engagement on Instagram when admarks are used. The figures mask the use of influencer advertising over influencer marketing

Influencer marketers should not be defeatist. The drop in engagement rates for Instagram paid-for content should not be automatic. They point more to the abundance of influencer advertising on Instagram rather than tried, tested, effective influencer marketing.

The drop in engagement rates, is because the content delivered on much Instagram sponsored content is sub par and flooding our newsfeeds.

Influencer audiences increasingly demand higher-quality sponsored content from the creators they follow. Fail to deliver and the business model collapses for both brand and influencer. I wrote more on this subject in my article: Why recent influencer fails are good for influencer marketing

But it doesn’t need to be this way … .

When we buy a magazine we do it because we like the type of content it provides. We like the topics the magazine covers be it fashion or business, food and drink or industry news.

We also buy the magazine because we like the way the content is delivered. The style of writing, the world-view of the masthead. We share their values. We identify with both the journalists and the masthead.

We don't buy the magazine for the advertisements the magazine publishes. But, we recognise there's a commercial imperative for the masthead to carry ads. They tend to subsidise the magazine's cover price. We draw the line though if we feel the ratio between paid-for and editorial content is out of kilter. We vote with our feet. We stop buying the magazine.

It's the same argument with influencer marketing. Will follow influencers because of the subject matter they cover, because of their expertise, because of their world values, because of their tone of voice. We relate to them. They're one of us.

We don't pay a subscription to see their content (not yet anyway). Our payment to them is our attention.

We understand that for many successful social media influencers the creation and distribution of content is their main source of income. There's a commercial imperative for these influencers to work with brands on sponsored projects. And, we're okay with that. The paid work is needed to subsidise their organic content.

But here`s the kicker:

3 rules for effective influencer marketing

As consumers we don’t have an issue with advertorial and sponsored content on three provisos:

  1. We don’t feel hoodwinked into thinking the content is organic -- i.e. admarks such as #ad and #spon are used effectively
  2. The content is relevant to us and of good quality; it educates, informs or entertains us
  3. We're not inundated with paid-for content - our favourite influencers produce a ratio of organic to paid-for content which we deem to be acceptable. This is probably no more than 1:3 sponsored to organic and ideally 1:4 or fewer.

Failure to disclose diminishes trust

61% of women said they won’t engage with an influencer’s sponsored content if it doesn’t feel genuine, according to a global survey of 20,000 conducted by Bloglovin, a blog aggregator site.

At their core, true influencers provide consistently compelling content and high levels of community engagement. Over time this helps them earn trust from their fans and establish themselves as credible voices.

Trust and authenticity are the bedrock of influencer marketing. Lose trust and authenticity and you lose the power to influence an audience, and with it the promotional work.

The drop in engagement rates, is because the content delivered on much Instagram sponsored content is sub par and fails at least one of the three of the above criteria.  

There is a drop in engagement rates due to the conflation of  influencer advertising and influencer marketing (transactional vs relationship-built).

So, no, effective influencer marketing shouldn't be damaged through the utilisation of admarks. But pressure for marketers to demonstrate ROI combined with a pressure for influencers to retain attention and action from their audience means that influencer marketing has to up its game.

This means:

  • Fewer, though longer-term brand relationships with influencers
  • More considered, creative output
  • Focus on producing harmony in  influencer marketing ecosystem between brand, influencer and audience.
  • More acceptable ratio of paid-for versus organic content produced 

* I am a strategic advisor to CampaignDeus.

About the Author Scott Guthrie

Scott Guthrie works with companies to drive business growth in the social age through strategic insight and technical know-how. That's not giving you a lot of detail, is it? So, read more here.

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