These days, media channels inundate consumers with more paid advertisements than ever before. Not surprisingly, the impact of this is that people trust paid advertising less and less. Anyone with a computer knows that advertisements are literally everywhere on the web -- and consumers are more resistant and critical than ever when it comes to paid marketing.
Likewise, social media and online communities are growing larger and more active every day. Word-of-mouth and earned marketing are incredibly powerful because consumers trust that the promoters have nothing to gain from product sales. Influencer marketing harnesses this power through systematically partnering with influential groups and individuals to review, discuss, and promote brands and products.
While influencer marketing can be paid -- similar to a sponsorship -- it's most effective when the influencer is unpaid, speaking freely and candidly, and without bias. This aspect is exactly what makes influencer marketing trustable to consumers.
If you're someone interested in optimizing your marketing to reach and convert the most people at the least cost, influencer marketing is a growing channel you can't afford to ignore. Check out these 5 influencer marketing stats that will show you why influencer marketing is on the rise and projected to stay there.
- Increase consumer trust. Consumer trust and confidence in paid advertising has declined by over 20% since 2007 (Nielsen). Conversely, consumer confidence in word-of-mouth advertising is growing -- 92% of consumers trust recommendations from peers or trusted authorities. Likewise, 72% of people rely on social media to inform their purchasing decisions (SimplyMeasured). These are staggering statistics, and they suggest a huge change in the way we think about marketing. Starting communities and conversations is now a more powerful tool for building brand trust and recognition than almost anything else.
- Stop wasting money and boost your ROI in marketing dollars. Influencer marketing averages a better ROI than any other online marketing channel. Businesses make an average of $6.50 for every dollar invested in influencer marketing -- and the top 13% of businesses make $20 or more for ever dollar spent (Tomoson). This is a higher ROI than paid search, affiliate marketing, and SEO optimization for organic search. Marketers rated influencer marketing as the most cost-effective marketing channel (along with e-mail marketing).
- Join the majority of who invest in what works. Businesses rated influencer marketing as their fastest growing online conversion channel, ranking higher than email marketing and search engines. (Tomoson) 59% of marketing departments are expanding their influencer marketing budgets this year (Tomoson).
- Convert better customers. Customers acquired through influencer marketing tend to be more loyal with a higher lifetime value. Customers converted this way are more likely to be active on social media, youtube, and product reviews. This means they're also more likely to promote your product via their own word-of-mouth channels, adding to their life-time value. Customers acquired through word-of-mouth have a 37% higher retention rate. (Deloitte) Because it's cheaper to retain customers than convert new ones, this strategy pays on multiple levels.
- Drive brand lift. Earned media drives 4 times the brand lift as paid media (Bazaar Voice). This means that people who interact with the earned media are way more likely to be impressed than they would be if they heard the same information through a paid channel -- and way more likely to buy from you or promote your brand. Again, this is about trust. Consumers know that someone who doesn't directly stand to profit from converting them is probably more worthy of trust.
Want to learn more about developing or beginning your influencer marketing campaign? Interested in best practices for identifying influencers, developing influencer relationships, and implementing new strategies in the most effective way?