Influencer Marketing: The Importance of Creators in the 21st Century | by Nicholas Bussiere | ICM 506 — Spring 2023 | Mar, 2023

The same goes with online influencers, using their presence and positive brand to push their audience to a sponsor. Whether it is Instagram, Twitter, or YouTube, Influencers are a core part of the platform, providing the content that drives users to return.

In essence, these people are consistent suppliers of videos, images, or anything above or between to a platform, usually with a large following of some kind. But, before jumping too far into the role of influencers in today’s environment, we have to understand a bit of background on marketing and its role in business.

It’s no surprise that marketing has become an essential aspect of every business. From startups to multi-billion dollar corporations, every team needs to get its name out there.

Marketing starts in one place.

The product.

The product lineup is the core of any brand, from the Roombas at iRobot or the iPhones at Apple. Without a product that people want to buy, it becomes difficult to effectively market your brand.

Next is the actual marketing part, knowing who you want to target your brand to, what you want to say, and how you want that message conveyed. This is the real salt and pepper of your marketing plan, otherwise, you aren’t really selling your audience on anything. You don’t see Apple going out and saying “this year’s iPhone is a phone!” Yeah, we know.

Once you have your entire message together, you’re ready to send it out there! But where exactly? Traditionally this would be in the form of advertisements either physically like on billboards, papers, or posters, or through mediums like TV, radio, or word of mouth.

Now brands have infinitely more options on how they want to promote themselves. They can use social media, email marketing, SEO and paid search results, and more.

But there’s just one problem.

In 2021, we saw one of the biggest drops in marketing budget recorded, falling from 11.0% of company revenue in 2020 to just 6.4% (Gartner, 2023).

Marketing professionals need to start being more concise with their spending, and in an ever-shrinking economy, the channels that they choose need to be worth their value.

Now that we know a bit more about marketing as a whole, we now can see why influencers stand as a good decision when deciding where to market a brand.

One of the most significant aspects of creator marketing is its high ROI (Return on Investment). In a report from HubSpot, they found that “1 in 4 marketers that currently leverage influencer marketing report that it offers the second highest ROI of any marketing trend” (Needle, 2023).

Having a high ROI is great, as influencers are able to give a decent value for a higher return than normal. Value is a core aspect in digital marketing, as often professionals can get great prices for social media marketing, SEO marketing, and more, so providing value in a space is what will get a creator a sponsorship.

Some of the ways that influencers are able to stay valuable is due to their low overhead in comparison to big corporations. Most of the time, influencers are a one-man show, with only a select few having an assistant or other help, or are backed by an organization that will manage their sponsorships.

Content organizations are one way for creators to break into a scene easily with the support of the organization. It allows an influencer to step back from much of the work of being independent for a steady paycheck. Often, creators will look for organizations like these that handle all of the background work like procuring contracts and sponsors, along with the overhead, and allowing the content creator to just, make content.

“Influencer marketing doesn’t just get you in front of the audience you’re trying to reach — it gets you there in a way that feels authentic and human.”
Annabelle Nyst — Senior Content Manager

These groups give small creators an opportunity to try and succeed, all while getting paid a steady salary, something that small creators often don’t see. This allows them to also work alongside other larger creators or esports teams to grow their platform, and become more self-sustaining.

Though, some of the downsides to these organizations is it is really easy to get screwed over. If you start gaining traction while still part of the group, you will likely continue to get paid the same as if you were the smaller streamer or creator, forcing you to wait until your contract expires, which can range from just a couple of months to four years.

Influencers also stand out due to their variety. For almost any situation, companies are able to find influencers that specialize in that area. From tech to beauty to gaming, there is someone for everyone, giving infinite potential to break into a fan base that is open to your brand.

This trust built between an influencer and their fan base is a core aspect of what makes influencers so special. In an article published by HubSpot, they found that “Influencers are more trusted than friends and family for Gen Zers…Annabelle Nyst, Senior Content Manager, Brand Social, says about influencers, ‘Their followers pay attention to their guidance just as they would that from friends or family. That is far more powerful than some advertising copy’” (Needle, 2023).

Trust is one of the main ways to get long time customers in any business, and influencers are a method to create these customers. HubSpot finds that “33% of Gen Zers have bought a product based on an influencer’s recommendation in the past three months”, a number high above the average for traditional forms of marketing. These creators are getting people to try products and services they would have never used before, something that is extremely helpful for DTC (direct-to-consumer) companies that are primarily online (Needle, 2023).

However, what sells more than any of the other tactics, is just acting like a normal person. Annabelle Nyst says how “Influencer marketing doesn’t just get you in front of the audience you’re trying to reach — it gets you there in a way that feels authentic and human.” Almost any message that a brand can convey is never going to feel authentic, it is either highly produced or filtered until it no longer feels real. Influencers provide that connection for viewers, being someone real that is supporting a brand, rather than a paid advertisement (Needle, 2023).

Influencers aren’t all that they are made out to be, and there can be some downsides to closely associating a brand with an individual.

Remember when I mentioned Johnny Depp earlier? Dior came under scrutiny after allegations arose painting Depp as a domestic abuser towards ex-wife Amber Heard. Even though Depp ended up with a positive reception after his trial, this is not always the case.

Influencers like Shane Dawson, who was a popular YouTuber and doing it for over a decade, suddenly got canceled by his fans after videos of him doing blackface ended up online.

Similarly, Jeffree Star, a popular makeup influencer, got reality checked after “drugging young straight men and coercing them with a taser to have sex with him” (Gatollari, 2021).

Obviously, both of these are horrible things to do so they were dropped by almost all of their regular sponsors immediately, but these are the risks that brands go through when choosing someone who essentially represents them in some way.

It is important for brands to thoroughly vet potential partnerships, to prevent any problems from ever taking place, however, no team is perfect.

Though the downsides are a problem for creators, the upside for the brand is that usually, people disassociate the actions of a person from that of a company. So, even if problems occur, after reasonable action (such as a response or note to distance from the problem), audiences maintain a positive perception of the brand.

The same problem can go the other way with creators, with brands being called out for poor practices, and the influencer needs to distance themselves. We saw this with some crypto companies recently, such as FTX and Coinbase, after they began withholding withdrawals from their customers, with still actively promoting themselves to try and get new investors. This is also while FTX declared bankruptcy and CEO Sam Bankman-Fried ran off with $300 million to the Bahamas.

This came as a major hit too many creators as hundreds to thousands of them took Coinbase sponsorships throughout the past year, and needed to come back out to renounce them.

Similarly, creators and even esport organizations like TSM, who earlier that year had announced FTX bought the naming rights for the organization for $210 million (with the name being TSMFTX), later said they were changing their name back and no longer affiliating themselves with FTX after the controversy.

Besides getting canceled, there are some other problems that marketing professionals might run into when trying to launch their campaign. Some of the biggest are,

• Poor matchup of brand and creator to reach the target audience
• Influencers ROI (Return on Investment) is not clear or communicated
• Decreased viewership on sponsored posts
• Managing the influencer to ensure the campaign is delivered correctly
• Fake or Scam Influencers

Though these problems aren’t as serious as someone getting deplatformed for heinous acts, these can have serious impacts on a business, especially if they are riding on the assumption that an influencer can return what they say.

Similarly, influencers that aim to just get the deal done, knowing they might not be able to hit their numbers, can also detract marketers from working with creators in the future, often lumping the entire tactic together instead of the single person.

Low viewership is also a common issue, with huge creators that normally garner thousands of likes on each post, getting only a couple hundred when it is a sponsored post. These can be huge detractors for creators and brands, as neither wants fans to feel disconnected from their posts. This is easily remedied through including creators more in the planning process, so they can help make the advertisement more their own, and far more likely to be interacted with.

Influencers have become the new age celebrities across the world. In an article from CNBC, it found that kids now are three times more likely to want to become a YouTuber than an astronaut. A CBS study found that about 86% of young Americans said they’re willing to try out influencing on their social media platforms.

Influencers have also sparked a new wave of marketing techniques for professionals to add to their arsenal, allowing them to directly connect with fans across the world, and break into existing markets easier than ever. They have proved their value for this new age, and are benefitting through increased payouts and more offers.

Even as the economy shifts, professionals expect influencer marketing to grow in the coming years. In 2023, influencer marketing was a $16.4 billion industry, and it is projected to expand to $84.9 billion by 2028. This is the time to find your passion, learn how to create and grow, and capitalize on the opportunities laid forth (Santora, 2023).

By no stretch of the imagination is becoming an influencer easy, but we expect micro-influencers to make a big impact as well, with Jacinda Santora of Influencer Marketing Hub saying, “Micro-influencers can help minimize a campaign’s advertising cost per action while still widening a brand’s reach. While their follower base may not be as big as that of celebrity influencers, they can generate more impact per impression made. It’s expected that micro-influencer marketing will grow faster compared to traditional influencer marketing” (Santora, 2023).

With the groundwork laid and the future looking bright, we have to wonder, who is going to take the jump?

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