Influencer marketing provides a way to capitalize on an individual's social credibility to carry your company's message through to earned media channels. It works like word of mouth marketing - and it can be incredibly effective. McKinsey reports that marketing from trusted sources is a motivator behind as much as a HALF of all purchasing decisions. SEM Rush also reported on influencer marketing effectiveness: "Influencers produce three times more word-of-mouth messages than non-influentials do, and each message sent has four times more impact on a recipient's purchasing decision." Influencer marketing can certainly be effective, but how do you know whether it is effective for your brand?
It can be difficult to track influencer marketing because its return on investment (ROI) is not linear. While some influencer campaigns are centered on promoting a specific product, they can also attract newcomers to the brand. Influencer marketing can attract sales of goods and services beyond those mentioned by the influencers. This means that a vote of confidence from the right influencer is a powerful recommendation. As such, in order to measure influencer marketing performance, you will need to look at ROI in a different way vs. solely relying on sales data.
Here is the right way to measure influencer marketing key performance indicators (KPIs):
You should start by looking at your referral traffic. Using a service like Google Analytics, will allow you to see how much of your site's traffic is direct (meaning that someone typed your website's address), search-based (indicating that someone searched for your website or a product you carry), and referrals (visitors who reach your site by clicking a link on another website). The referral visitors metric is an important KPI for influencer marketing.
Another way is to examine influence marketing KPIs is to look at the direct sales generated by the influencer's network. These could be determined by the link new prospects used to make their final purchase - likely one from the influencer's channel - and is easy to track if you provide your influencers with a unique referral link. Alternatively, an influencer can be provided your company with a unique coupon code. You can then track how often that code is redeemed in your POS systems.
In addition to generating sales, influencer marketing also improves brand awareness and sentiment. You can measure whether an influencer has been effective by looking at brand awareness metrics before and after your sponsored post. Use a social media analysis tool such as SocialMention or Trackur to keep track of how often your brand is mentioned on social media and the ratio of how many positive comments there are to how many negative ones. Your current brand awareness metrics can act as a baseline.
Furthermore, make sure you track the individuals your social media influencer brings to your brand beyond the initial post. What your influencer might lack in quantity, he or she could make up for in quality. Influencer marketing can be considered just as successful if your influencer brings you 100 people who each make a single $10 purchase as if they bring you 10 people who spend hundreds of dollars on every purchase. The difference adds up over time.
The best way to measure influencer marketing is to keep track of the direct referrals that come from your influencers as well as direct sales, brand awareness and quality of prospects - and keep tracking of them long past the initial post. These metrics will help you better see what influencer marketing is doing for your business and make it easier to set marketing goals for your influencers and your company. In turn, you will be able to make better decisions about the influencer marketing your company pursues and the influencers with whom your company works. The end result is a perpetuating cycle that will help you refine how your company works with influencers.
Wondering how to get started with Influencer Marketing? Not sure how to measure Influencer Marketing? Fear not… we have you covered. Please contact us at info@rmimpr.com or at 480-305-2017 for more information. We are happy to help.