Social Influencer Fraud to Cost Brands $1.3B This Year
You knew it was coming, marketers. Based on our martech buying research, social media marketing tools are your No. 1 purchase — by a lot. And brands big and small are optimizing SMM with influencers — but a new study finds social influencer fraud will cost you $1.3 billion in 2019.
On July 25, CBS News quotes research from cybersecurity firm Cheq:
- At least 15% of advertisers' spending on influencer marketing is lost to fraud, costing them $1.3 billion annually.
- Mega influencers with a million or more followers can earn $250,000 per social media post, but nearly $38,000 of that money is wasted by brands on fake or inflated follower counts.
- Experts say red flags for fraud include recently created accounts with many followers but little engagement: "If you see 1 million followers on Instagram but posts have 80 or 100 likes, that is immediately suspicious."
Some brands are even spending some of that $8.5 billion a year on fake influencers, or personas, the study finds. Marketers are sinking so much money into influencers because, as Edelman’s consumer trust survey found, 63% prefer to hear from an influencer with whom they identify than a brand’s own advertising. They also prefer influencers like them over celebrities, CBS reports.
Interestingly, part of the fraud is due to brands not fact-checking martech, which is doing the influencer selection for them. CBS states that, in general, brands are picking influencers based on their reach, but not vetting the influencers or their followers — who may have left the social platform where they’re listed as fans.
While the intuitive solution is for marketers to do a better job of influencer vetting, the CBS take is that the platforms themselves should be eliminating fake accounts faster.
Here are four other tips about how brands can hire influencers, as I wrote in September 2018:
- Pick influencers based on their relevance to your brand values, their influence with your target audience and their desire to, in fact, be your influencers.
- Use marketing influencers to educate consumers, not promote products
- Influencers must reveal messages are sponsored. If they don’t, the advertisers are the responsible parties, according to the FTC.
- While this next tip sounds nebulous, it’s the most important one: Ensure your partner influencers are trustworthy, because consumers need to be able to trust your brand.
And here’s how Greg Shepard wrote in March for Target Marketing that brands can determine they’re getting what they paid for:
Analyze Metrics From Every Angle
Whether you're talking about likes, clickthroughs, or conversions, you should consider numerous ways to track your success with influencers. This information can help you figure out which influencers are suited for different situations. For example, one influencer might be perfect for a product launch, and another might be better for your holiday campaign. Weigh metrics proportionally to campaign goals, which will allow you to create a composite score that reflects the real value of each influencer partnership. Focus on the quality of content an influencer provides, as well as the recency of engagements.
Balance Out Micro and Macro
Macro influencers are great for reach, but volume doesn't necessarily provide the engagement that a micro influencer is capable of driving. Test campaigns with influencers of all sizes to determine the success of various tactics. At every stage, keep influencer fees in mind. Macro influencers might command flat rates for access to their large followings and engagement, but micro influencers might be willing to accept free products or commission, in exchange for any conversions they’re able to generate.
Experiment With Different Formats and Tools
Varying ad formats and the use of attribution tools in campaigns will significantly affect your results. Use sound marketing science, including control groups and single variables, to isolate successes in order to replicate wins and eliminate nonfactors for future collaborations. Consider sharing an exclusive promotional code in one influencer campaign and testing content alone in another, and then compare the return on investment of the two campaigns. Leesa, a direct-to-consumer mattress company, was able to generate 100,000 clicks to its website and 400 sales by offering influencers a promo code to accompany their unbiased insights on the company's mattresses.
What do you think, marketers?
Please respond in the comments section below.