Tips for Founders - Creating & Executing a Successful Influencer Marketing Strategy
Sam Johnston
Energy Investment Management, Venture Studio Cofounder, Incubator, Accelerator & VC, Cofounder nth Venture - Scale Up Specialist US 🇺🇸 & EU
Tips For Founders - Creating & Executing a Successful Influencer Marketing Strategy
Having spoken to a good number of startup founders there is often some confusion as to what influencer marketing is, how it can be used if its right for their business, and how they should get started. To answer some of these questions we will cover the following sections and look at examples from brands such as Gymshark, Nike, Glossier, Fenty Beauty and more in this newsletter:
What is influencer marketing?
Influencer marketing is a strategy that involves partnering with individuals who have a significant following on social media to promote a brand, product, or service. These individuals, known as influencers, have the ability to influence their followers' buying decisions and behaviors through their online presence and credibility. Influencer marketing can take many forms, including sponsored posts, product reviews, and endorsements, and it is often used to increase brand awareness, drive sales, and engage with a target audience. This marketing approach has become increasingly popular in recent years, particularly but not limited to industries such as fashion, beauty, and lifestyle.
Why is influencer marketing popular?
influencer marketing has become an essential part of many successful businesses' marketing strategies.
According to a survey conducted by Influencer Marketing Hub ;
63% of marketers intend to increase their influencer marketing budget in 2023, which is a clear indication of its effectiveness.
Influencer marketing has become increasingly popular in recent years because it offers several advantages over traditional marketing approaches. Here are some of the reasons why influencer marketing has become a go-to strategy for many businesses, backed up by data:
Increased ROI:
Businesses that invest in influencer marketing can earn $5.20 for every $1 spent, which is a significant return on investment. This is because influencer marketing allows businesses to reach a highly engaged and targeted audience through trusted and relatable influencers, resulting in a higher conversion rate.
Higher engagement:
Influencer marketing often generates higher engagement rates compared to traditional advertising methods. According to a report by influencer.co, the average engagement rate for sponsored content on Instagram was 3.21%, which is significantly higher than the average engagement rate for non-sponsored content (1.22%). This high engagement rate is due to the relationship and trust that influencers have built with their followers, making their endorsements more authentic and valuable.
Better targeting:
Influencer marketing allows businesses to target specific audiences more effectively than traditional advertising methods. According to a survey by Linqia , 57% of marketers consider targeting the right audience to be the most challenging aspect of influencer marketing. However, once businesses are successful in identifying and partnering with the right influencers, they can reach a highly targeted audience that is interested in their products or services.
Authenticity:
Influencer marketing is often perceived as more authentic than traditional advertising methods, such as TV commercials or banner ads. According to a survey by Edelman , 63% of consumers trust influencers more than they trust brands. This is because influencers have built trust with their followers over time by providing valuable content and sharing their personal experiences.
How to decide if influencer marketing is the right strategy for your business?
Influencer marketing could well be the most powerful tool available for your startup, however... it's not always the right strategy for every business. Here are some factors to consider when deciding if influencer marketing is right for your startup:
Your target audience:
Influencer marketing is most effective when your target audience is active on social media and follows influencers within your industry. If your target audience is not active on social media or does not follow influencers, influencer marketing may not be the most effective strategy for your startup.
Your budget:
Influencer marketing can be expensive, especially if you're partnering with high-profile influencers. Before investing in influencer marketing, consider if it's a financially viable option for your startup and whether the ROI justifies the expense.
Your product or service:
Certain products or services may be better suited for influencer marketing than others. For example, fashion and beauty products, fitness and wellness products, and food and beverage products are all industries where influencer marketing can be highly effective. If your product or service is not inherently visually appealing or does not lend itself well to be demoed or shown visually on social media, influencer marketing may not be the best strategy.
Your goals:
It's important to define your goals before investing in influencer marketing. Are you looking to increase brand awareness, drive sales, or build brand loyalty? Depending on your goals, influencer marketing may or may not be the most effective strategy. It is great for raising brand awareness and brand loyalty but if you want direct purchases and have tight margins your CAC may well be too high within this channel.
Your brand values:
Partnering with influencers means aligning your brand with their personal brand and values. Before partnering with an influencer, make sure their values align with yours and that they are a good fit for your brand.
Ultimately, the decision to invest in influencer marketing should be based on a careful analysis of your target audience, budget, product or service, goals, and brand values. If you determine that influencer marketing is the right strategy for your startup, it can be a highly effective way to reach a highly engaged and targeted audience and build brand awareness and loyalty.
However, like any other marketing strategy, influencer marketing requires careful planning, implementation, and execution to achieve its intended objectives.
Executing a successful influencer marketing strategy
Below, we will provide insights into how to create, implement, and execute a successful influencer marketing strategy. We will also look at examples of successful and unsuccessful influencer marketing campaigns, backed by data and research.
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Step 1: Define Your Goals and Objectives
Before you start working on your influencer marketing strategy, you need to have a clear idea of what you want to achieve from it. It could be to increase brand awareness, drive traffic to your website, generate leads, or boost sales. Once you have defined your goals and objectives, you can then identify the metrics that will help you measure your success.
Example: Glossier, Inc.
Glossier is a beauty brand that has achieved tremendous success through its influencer marketing strategy. The brand's primary objective was to increase brand awareness, and it achieved this by collaborating with influencers who had a large following on social media. Glossier's founder, Emily Weiss , explained in an interview with Forbes that the brand's influencer marketing strategy was to create a community of people who love and support Glossier. By working with influencers who shared Glossier's values and aesthetic, the brand was able to create a loyal customer base that helped it grow.
Step 2: Identify Your Target Audience
Once you have defined your goals and objectives, the next step is to identify your target audience. You need to know who your customers are, what they like, and what type of content they engage with. This will help you choose the right influencers who have the ability to reach your target audience effectively.
Example: Fenty Beauty
Fenty Beauty is a makeup brand that was launched by singer and actress Rihanna in 2017. The brand's target audience is women of specific ages and skin types, and it has successfully used influencer marketing to reach them. Fenty Beauty has collaborated with influencers who have a diverse following, including women of color, to promote its products. This has helped the brand to establish itself as a leader in the beauty industry, with a focus on inclusivity and diversity.
Step 3: Choose the Right Influencers
Choosing the right influencers is critical to the success of your influencer marketing campaign. You need to work with influencers who have a genuine connection with your brand and its values. They should also have an engaged following that is interested in your products or services. It is essential to look beyond the number of followers and focus on the quality of engagement.
Example: Nike
Nike has been using influencer marketing for years, and it has had several successful campaigns. The brand's collaboration with soccer player Cristiano Ronaldo is an excellent example of how to choose the right influencer. Ronaldo has a massive following on social media, but he also has a genuine passion for fitness and sports. By collaborating with him, Nike was able to tap into his engaged following, which was of course interested in fitness and sports. I am not saying you will have the budget to go an snag Ronaldo, however, it gives an idea of the influence within the target market you want to aim for.
Step 4: Set a Budget
Influencer marketing can be expensive, so it is essential to set a budget and stick to it. You need to determine how much you can afford to spend on your influencer marketing campaign, based on cost per impression, cost per click, and cost per conversion down the funnel, and track and allocate it accordingly. It is also crucial to negotiate with influencers to ensure that you get the best value for your money.
Example: Gymshark
Gymshark is a UK-based fitness apparel brand founded by Ben Francis MBE that has leveraged influencer marketing to become one of the fastest-growing companies in the industry. Here are some of the ways Gymshark has used influencer marketing to be successful:
Partnering with micro-influencers:
Gymshark has been successful in partnering with micro-influencers, who are individuals with smaller followings but highly engaged audiences. According to an analysis by Tribe Dynamics (now CreatorIQ) , Gymshark had the highest earned media value (EMV) from micro-influencer partnerships, with an EMV of $31.5 million.
Creating a community:
Gymshark has built a strong community of loyal customers and followers through its influencer marketing strategy. According to a report by Influencer.co, Gymshark had the highest engagement rate on Instagram among fitness apparel brands in 2021, with an average engagement rate of 4.48%.
Diversifying their influencer portfolio:
Gymshark has also been successful in diversifying its influencer portfolio, partnering with individuals from various fitness backgrounds and with different levels of influence. This allows Gymshark to reach a wider audience and appeal to individuals with different fitness goals and interests.
Leveraging events:
Gymshark has also leveraged events to promote its brand and products through influencer partnerships. For example, Gymshark hosts an annual fitness expo called "Gymshark Lifting Club," where they invite their top influencers to attend and promote the event on social media. According to a report by The Drum , the 2019 Gymshark Lifting Club event generated over 4 million social media impressions.
In conclusion, Gymshark has successfully used influencer marketing to build a strong community of loyal customers and followers, reach a wider audience through micro-influencer partnerships, and leverage events to promote its brand and products. By diversifying its influencer portfolio and partnering with individuals from various fitness backgrounds, Gymshark has been able to appeal to a wider audience and stay ahead of the competition. The data shows that Gymshark's influencer marketing strategy has been highly effective, resulting in significant earned media value and engagement rates.
This article is part of a newsletter series - Tips for Founders
This series will include general hints and tips for founders going through the grind of starting their businesses, including ideation all the way through to product market fit, scaling, and capital.
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1yGreat piece, Sam!