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Sourced from 3BL

Trust dynamic not the only shift for younger generations

For years, word-of-mouth has played a critical role in the marketing success of small businesses. New data from GoDaddy suggests that recommendations from friends, family and co-workers are being replaced by influencers in terms of importance to younger consumers.

The GoDaddy survey of 1,000 U.S. consumers in September shows that while both Gen Z and Millennial customers are starting to behave differently than traditional shoppers, that doesn’t mean they are trending in the same direction.

Approximately 4 in 10 Gen Z consumers (41%) trust a product or service posted by an influencer over an ad from a business, whereas nearly 5 in 10 Millennials (46%) trust an ad from a business more.

Among both generations, when asked the likelihood of buying an item from a post on social media, posts from friends ranked low on the list.

Gen Z is more likely to buy something an influencer recommends, with friends coming in last.

  • An influencer’s post (57%)
  • A post from a business I follow (54%)
  • An ad in my feed (49%)
  • A friend’s post (40%)

Millennials are more influenced by the businesses they choose to follow, with influencers and friends holding the least weight.

  • A post from a business I follow (57%)
  • An ad in my feed (51%)
  • A friend’s post (48%)
  • An influencer’s post (44%)

“Knowing that Gen Z consumers trust social media ads more than recommendations from friends is a game-changer if this is your target audience,” said Alycia Leno, director of marketing at GoDaddy. “Insights into how each generation shops, especially on social media, will empower small businesses to rethink their strategies and using the right tools will maximize their businesses social media marketing.”

Even though Gen Z and Millennial shoppers may differ in who they trust while scrolling through feeds, they still see the value social media and social ads offer.

  • Most Gen Z (55%) and Millennial (47%) consumers regularly rely on social media to discover new products every, or nearly every time.
  • More than half of Gen Z (53%) and Millennial (57%) customers are served an ad that results in them taking action at least every week.
  • Nearly 3 in 10 Gen Z (28%) and Millennial (32%) consumers find social media ads helpful to learn about new products and/or businesses.

These findings show that small business owners need a good grasp of their audience, or they risk wasting time and spending money unnecessarily. By understanding how each generation prefers to shop on social media, entrepreneurs can target customers more directly and see better results faster.

Entrepreneurs can lean on online tools to maximize every social media post and ad. Digital Marketing from GoDaddy leverages the intuitive features of GoDaddy Airo™ and GoDaddy Studio to create custom AI-generated content, schedule social media posts, create digital ads, access helpful analytics and more. These cost-effective tools are readily available to small businesses of any size, with any budget, to help attract new customers and increase sales.

To learn more about GoDaddy and its products, visit www.GoDaddy.com.

About GoDaddy
GoDaddy (NYSE: GDDY) helps millions of entrepreneurs globally start, grow, and scale their businesses. People come to GoDaddy to name their idea, build a professional website, attract customers, sell their products and services, and accept payments online and in-person. GoDaddy’s easy-to-use tools help microbusiness owners manage everything in one place and its expert guides are available to provide assistance 24/7. To learn more about the company, visit www.GoDaddy.com. Source: GoDaddy Inc.

Sourced from 3BL

Originally published on GoDaddy

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Companies are increasingly highlighting their support for diversity, but that can backfire if consumers sense tokenism, a recent analysis from my team found.

I’m an assistant professor of marketing who specializes in digital platforms and consumer behaviour. My recent research focuses on DEI initiatives by brands on social media. I’m specifically interested in how brands use influencers and minority representation.

An influencer is someone who has built a large following on social media and can affect the opinions or behaviours of their audience. Influencer marketing is when brands partner with these people to promote their products or services to the influencers’ online followers.

For an example of influencer marketing, consider this post from the influencer Thamarr Guerrier promoting Old Navy:

Influencer marketing has become one of the main channels for brands and consumers to interact, and minority representation among influencers is one way a company can display its commitment to DEI.

To understand how consumers have been responding to this trend, my colleagues Amy Pei and Keran Zhao and I collected data from the platform X, formerly known as Twitter. Our unique dataset included sponsored content from about 150 brands between 2018 and 2022, as well as details about influencers and reactions from consumers.

We found that brands with either very low or very high levels of minority representation among influencers experienced higher consumer engagement. Meanwhile, brands with moderate levels of minority representation saw a dip in engagement. These effects were particularly pronounced for large companies and those that demonstrated a prior vocal commitment to DEI initiatives.

In other words, we found a U-shaped relationship: Low levels are accepted, intermediate levels may backfire, and high levels are well received. We believe this may stem from consumer perceptions of tokenism at intermediate levels.

In contrast, we found that high minority representation convinces consumers of a brand’s genuine commitment and effort.

Why it matters

When brands showcase their support for diversity initiatives on social media, it doesn’t always win over consumers. In fact, DEI policies have been a source of controversy for many brands, including Chick-fil-A, Disney and Bud Light.

Since DEI initiatives from brands often provoke mixed reactions from consumers, it’s important to understand why. Our research offers a clue.

DEI is a sensitive issue, and consumers value genuine commitment. Our work suggests that brands – especially larger ones – should avoid taking moderate stances and instead adopt a clear position.

We also found that customers had stronger reactions to brands’ diversity efforts when those brands had previously expressed strong support for DEI. That suggests brands should be cautious about excessive public signalling if they don’t plan to back it up with action.

What still isn’t known

More research is needed to understand how consumers respond to diversity messaging from brands. For example, previous work has shown that consumer boycotts are often short-lived. But the Bud Light boycott, sparked by the use of a trans influencer to promote the brand, lasted for eight months.

Several things could explain the discrepancy, including political polarization among Bud Light’s consumer base and the fact that there are many light beers on the market.

Another key factor appears to have been the visibility of consumption: People often drink beer in social settings, which allowed boycotting consumers to publicly signal their stance, further strengthening the movement. These and other factors warrant more investigation.

Feature Image Credit: Xavier Lorenzo/Getty Images

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Sourced from The Conversation

By Gili Malinsky

More than half of young people want to be influencers — 57%, to be exact.

That’s according to a 2023 Morning Consult survey of 1,000 Gen Zers. And they’re not alone. Nearly half, 41% of adults overall would choose the career as well, according to a similar Morning Consult survey of 2,204 U.S. adults.

Their reasons vary. Some “are very excited about the idea of celebrity, fame and money,” says Victoria Bachan, president of talent at influencer agency Whalar. Some “are just genuinely looking for a place to connect and find community,” and there are those who simply love to create using the tools of social media, she says.

Whatever their reasons, the job may be harder than it seems. Here’s what it looks like day-to-day and the many challenges creators face along the way.

‘There’s a misperception that it’s easy’

Becoming a paid creator is basically akin to running “your own independent media company,” says Taylor Lorenz, host of tech and culture podcast Power User and author of “Extremely Online.”

“There’s a misperception that it’s easy,” she says, adding that, “most startups fail, and I think most media startups fail, too.”

There are 4.2 billion social media users around the world, according to linking tool company Linktree’s 2022 Creator Report. Out of those, 200 million are creators, or individuals who monetize their audiences. That means just 4.7% of social media users are making money from it.

Even if they are making money from it, it’s not necessarily enough to live on. About half, 48% of creators make $15,000 or less per year, according to a 2023 survey of more than 2,000 creators by influencer marketing agency NeoReach. Less than a third, 28.9% make more than $50,000 per year doing it.

‘It’s just constant, Monday through Sunday’

For those who are able to make a career out of it, the day-to-day can be gruelling.

Hannah Williams, 27, and her husband run the popular TikTok account Salary Transparent Street, where they ask people around the country what their salaries are. The channel has 1.4 million followers, and most of their income comes from brand partnerships with companies like Capital One, with a far smaller share coming directly from the platforms they post content on through creator funds.

Williams has been a full-time creator since quitting her previous job as a data analyst in 2022. In 2023, her business brought in more than $1 million altogether. She now pulls in $125,000 per year for her own salary.

Williams usually starts working around 8 a.m., including emails, video editing and planning content. Between noon and 3 p.m., she’s usually on calls with clients. She takes a break around 4 p.m. and gets back to her desk around 6 p.m., at which point she’s working “full on until midnight,” she says. She and her husband also travel a lot for the job, and they post at least once a day.

“It’s just constant, Monday through Sunday,” she says. “From the time you wake up to the time you go to bed, the internet’s on, so you’re on as well.”

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Caroline Lasher, 22, has been a full-time creator since she graduated college in 2022. Her Instagram has 126,000 followers and her TikTok has just under 85,000. Lasher mainly creates beachy lifestyle content and makes much of her money through brand partnerships and affiliate links. Her income fluctuates, but she often brings in more than $10,000 per month.

Lasher wakes up around 8 a.m. and starts reading emails and contracts. She tries to post every day, so might do some editing in the morning as well. She’ll then go out shooting until the evening.

“I’m my own photographer, videographer and I edit everything myself,” she says, “So when I go out, I’ll usually have my tripod and I’ll look at public locations that I can take pictures at.” When she gets home in the evening, she’ll have dinner and decompress, then often edit until about 10 p.m. She works every day but takes breaks to grab a meal with a friend or after dinner.

Lasher’s schedule also depends on the companies she works with. There are weeks and months when they’re all trying to promote new seasonal products, and weeks when demand for partnerships is lower.

For many creators, clients can also be fickle and make demands like nonsensical timelines. “It’s almost like things that are in writing don’t matter,” says Bachan. “Initial timelines don’t matter. Contracts don’t matter. [Brands] want what they want, when they want, how they want it.”

Whatever the demands, Lasher, too, finds it’s nonstop.

Influencing is “so hard to walk away from,” she says, “since it’s on your phone and everyone’s on their phone all the time.”

‘We’ve literally been on our toes for nine years’

This type of never-ending schedule lends itself very easily to crashing.

“I have burned out,” says Lasher. “It usually comes in waves.” When it does, she’ll either give herself a few days off or simply work through it.

Creators say that the platforms they post on make it more challenging to take a break. Going for a few days without posting might mean that their content won’t be shown to as much of their audience when they return. Despite Lasher’s mental state at times, “I feel like not being active is going to hurt me,” she says.

There are other challenges as well. Platforms change or disappear altogether, leaving creators needing to reinvent themselves anew somewhere else. TikTok itself might be banned in January 2025.

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Leslie Mosier, 32, has been running social media accounts for her dog, Doug the Pug, since 2013. After getting some sponsorship deals, she dove into creating full time in 2015. Their Facebook page has 5.7 million followers, their TikTok has 6.1 million followers and their YouTube page has 634,000 followers. Doug the Pug has made money through sponsorship deals, books deals and merchandising. Most recently, Mosier and her husband launched an organic dog product company called Nonipup.

“Nothing stays the same for longer than, like, six months,” says Mosier of the fluctuating popularity of platforms and the constant introduction of new ones. She adds that “we’ve literally been on our toes for nine years.”

‘You can imagine the racism that my partner and I experience’

Another unique component of the job, and ultimately one of the most challenging, is that it’s public facing.

“You basically have all the downsides of traditional celebrity fame and very few of the upsides,” says Lorenz. “So you get hate, harassment, stalkers. There’s not a single content creator I’ve ever talked to that hasn’t dealt with online abuse.”

Williams and her husband, for example, are an interracial couple, “so you can imagine the racism that my partner and I experience on a near daily basis,” she says. She’s been called various derogatory terms and says she’s gotten comments like “you guys will be divorced and she’ll be pregnant in a year.”

‘Do something you enjoy doing, even if no one’s watching’

Still, there’s plenty that creators enjoy about their jobs. Williams enjoys the freedom and flexibility it brings. Lasher loves photography and the creative aspects of it. Mosier loves putting a smile on people’s faces with her puppy.

Caspar Lee, 30, was a full-time YouTuber for about seven years, making comedic videos about his life and ultimately getting to interview movie stars like Will Ferrell and Kevin Hart. He still has more than 6.5 million followers on his channel, plus millions more on his other social media platforms.

But in 2019, he realized he just “didn’t love the process as much as I used to,” he says. So he quietly stepped away. He now works on various entrepreneurial ventures, including talent management company MVE Management and venture capital firm Creator Ventures.

Among his advice for finding success as a creator is to use the tools at your disposal, to diversify the platforms you post on and to find a niche for the content you make. Plus, he says, “it’s hard, so my advice would be do something you enjoy doing, even if no one’s watching.”

Feature Image Credit: Carlos Barquero | Moment | Getty Images

By Gili Malinsky

Sourced from CNBC make it

By Michael Kuzminov

Influencer marketing is one of the best forms of digital advertising today.

Companies of all kinds are harnessing influencers’ immense sway over their followers to boost their reputations and compete with rivals.

Influencers also can have a large impact on driving consumer purchasing behaviour. A recent study found that 74% of consumers have bought a product because an influencer recommended it.

But how exactly do influencers drive consumer behaviour? Let’s explore this topic.

Trust And Authenticity

The sway that influences hold over consumers hinges on trust and authenticity. As a result of being authentic and honest about their thoughts and experiences, influencers can gain followers’ trust. Research shows that 71% of consumers trust influencer content. Their followers also tend to hold them in high esteem and perceive them as authorities in their respective niches. This goes a long way toward convincing their followers to purchase a particular product.

Fear Of Missing Out And Social Proof

Social proof is a big deal for consumers. They often see a product as more attractive when they see other people, particularly influential people, promoting it. The fear of missing out (FOMO) comes into play as well, causing customers to move quickly so they do not feel left out. Influencers often take advantage of these dynamics by making products seem exclusive and time-limited, which can increase sales through impulse buys.

Boosting Engagement

Influencers play a crucial role in raising brand awareness and encouraging meaningful follower interactions, which ultimately leads to measurable outcomes. Their talent for crafting captivating stories about items strikes a chord with buyers, starting discussions and shaping their choices.

Overcome Obstacles And Achieve Your ROI Goals

While influencer marketing may seem promising, there are challenges as well. There are a lot of influencers out there, and since every business is unique, you have to conduct careful research into the influencers you partner with. In the interest of authenticity, make sure you carefully select influencers whose values align with your brand’s.

Remember that successful influencer partnerships go beyond product placements. You need a well-planned strategy for seamlessly integrating your brand into the influencer’s content to ensure relevance and authenticity. Influencer marketing works best when you focus on true partnerships rather than advertisements.

You also have to keep track of how effective your influencer marketing activities are by measuring your return on investment. Keep an eye on metrics including your engagement rate and conversion rate, as well as your brand perception.

Embrace Innovation And Adaptability

Always be prepared to adapt to changing trends in today’s digital world. Pay attention to new platforms and trends in the field of influencer marketing, and encourage innovation. For example, experiment with the way you cooperate with your partners and negotiate prices for sponsored material. Learn about affiliate marketing strategies.

Seek to build long-term relationships with influencers rather than viewing them as one-time partners. By nurturing these relationships, you’ll not only strengthen them but also boost the number of long-term fans of your business.

Conclusion

Influencers have a lot of power when it comes to driving consumer purchases because they can persuade others to act. Businesses can tap into this power by building authentic long-term relationships with influencers and working together to build trust with their target audience.

Feature Image Credit: Getty

By Michael Kuzminov

Follow me on LinkedIn. Check out my website.

Michael Kuzminov is the Chief Growth Officer (CGO) at HypeFactory, a global AI-powered influencer marketing agency. Read Michael Kuzminov’s full executive profile here.

Sourced from Forbes

By CHRISTINE SCHUECKLER

Never mind that most of the lifestyles portrayed online are unattainable (and often staged). We still grow jealous of the wealth and fame that influencers flaunt.

Americans’ credit card debt soared to a startling $1.13 trillion at the end of last year. The majority of that debt can be attributed to rising interest rates and the higher cost-of-living overall, but an estimated 7% of Americans are compulsive shoppers, accumulating significant credit card debt through hundreds of nonessential purchases.

The enticements to buy are never-ending. Spend five minutes scrolling through influencer content on social media and you’ll encounter an array of expensive products flung in your face in the form of subscriptions, skincare aids, exercise equipment and just about anything else you can imagine.

From everyday advertisements to shopping haul videos to the popular “what I spend in a day” motif, influencers are pushing purchase after purchase at their viewers. It’s no surprise that purchases of personal care items and clothing are on the rise, with the majority of that spending considered nonessential. Americans are overspending, falling victim to overconsumption and perpetuating a cycle of wastefulness.

Social media shamelessly promotes materialism. Advertising is everywhere on social platforms − not just when influencers shower praise on the brands that sponsor them, but also in each strategically placed item facing the camera, brand name out.

Lifestyle influencers’ platforms often focus on strategies for happiness and well-being, showcasing an idyllic life that involves little beyond a daily workout in expensive clothing and aesthetically pleasing meals. The message is that money can buy you love − and happiness. You just need to spend it all to have it all.

Influencers create a false sense of reality

Sure, we know that these lifestyles aren’t realistic, but it’s all too easy to believe that influencers’ routines are candid, accurate representations of the creators’ daily lives.

What many consumers – myself included – often fail to recognize is that social media is a business. A survey conducted by Later found that 94% of influencers make money via brand partnerships – when a brand pays the influencer to market their product to their viewers.

Many influencers make a large part of their profits through Amazon Storefronts, where they link products that they display and encourage viewers to shop from there. It’s anyone’s guess whether the content creators actually like or even use the products.

Influencers capitalize off of their viewers’ compulsive buying habits, equating their seemingly perfect lives with the amount of goods they own. Lifestyle influencers love to display their thousands of beauty products, dozens of Amazon packages on their doorsteps and color-coded fully stocked fridges as the secrets for a romantic life. Their content is based on the idea that their happiness, or at least the illusion of happiness, is found through stuffWant to be as organized and put-together as me? Shop these products through the link in my bio!

Influencer Emma Chamberlain in Paris on June 23, 2024.  
GEOFFROY VAN DER HASSELT/AFP VIA GETTY IMAGES

Never mind that most of the lifestyles portrayed online are unattainable (and often staged). We still grow jealous of the wealth and fame that influencers flaunt.

Content creators keep pushing us to buy more, more, more, and a recent study found that social media use has a correlation with materialism, promoting the desire for more and more possessions. Yet, contrary to popular belief, owning more “stuff” has been demonstrated to be detrimental to overall life satisfaction.

No Instagram, no TikTok: I wasn’t allowed a smartphone until I was 16. I can’t thank my parents enough.

This overconsumption of products marketed on social media is not only dangerous for your wallet; it’s also bad for the environment.

The lifestyle that internet personalities advertise is incredibly wasteful. Any fridge or pantry restock video features dozens of single-use plastic items arranged pleasingly in organized acrylic bins ‒ individually wrapped snacks, plastic bottles of water, soft drinks in aluminium cans. This amount of waste is unjustifiable, especially because it’s more about aesthetics than practicality.

Influencers push fast fashion that hurts the environment

Even worse, social media has contributed to the rise of fast fashion: cheap, mass-produced clothing that caters to trendiness rather than quality. This results in mind-blowing amounts of textile waste and water pollution from dyes, as world consumption of clothing has increased by 400% in the past 20 years.

Then there are the accusations of labour law violations and personal information theft from major fast-fashion retailers such as Shein and Temu.

The primary goal of influencers is to make money, not help their viewers make smart purchases.

Most of us don’t get paid to have a 17-step skincare routine. Influencers do. Their job is glorified advertising. And guess what? You don’t need most, if not all, of the products that they claim you do.

We need to think about where and why we spend our money. If it’s to mimic a 45-second video of people who film themselves getting out of bed in the morning, maybe put away your wallet.

You’ll probably be happier and the earth will, too.

By CHRISTINE SCHUECKLER

Christine Schueckler is a USA TODAY Opinion intern and a rising third year student at the University of Virginia, where she studies English and French. At UVA, she writes for The Jefferson Independent and performs with the UVA University Singers.

Sourced from USA Today Opinion

By Stewart Perrie

Bowen is trying to save her bikini brand from going under and thought influencers might be the answer.

An Aussie business owner has been left speechless after seeing how much influencers charge for spruiking people’s products on social media. An influencer told Yahoo Finance it’s like the “wild, wild west” for how creators come up with their pricing models and bikini brand owner Bowen found that out the hard way.

She’s trying to rescue her business, Prilla Collective, from going under and she only has a few weeks before it goes bust. One avenue Bowen looked at was getting influencers to flaunt her bikinis and she reached out to a few that had a decent online following.

But she was not prepared for how much they wanted in exchange for a post.

Bowen looking at a screen next to two women posing in bikinis
Bikini brand owner Bowen couldn’t believe how much influencers were charging for social media brand deals. Pictured are two models from a previous Prilla Collective shoot and are not the influencers approached by Bowen. (Source: TikTok/Instagram)

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“I didn’t realise I would have to take a second mortgage to email influencers to see if they [would] work with a small brand like mine,” she said.

The first creator she reached out to has 210,000 followers and they were charging $4,500 for a post on their Instagram feed, $6,500 for a reel and $1,000 for a five-frame story post, she said.

The second, who has 86,000 followers, was a bit more affordable and they wanted between $1,300 to $3,000 depending on what format it was and on which social media app.

The third and final influencer, which Bowen admitted was probably well out of her reach due to her following, caused the bikini brand owner to “nearly fall off her chair”.

The unnamed creator wanted nearly $60,000 for an Instagram reel, close to $33,000 for an Instagram story, and $82,000 for a TikTok video that would’ve highlighted the product.

They also said they could do a TikTok video that didn’t mention the bikini and that would set Bowen back nearly $48,000.

“I know this is people’s job but I did not realise that’s how much money these influencers make,” she said. “I’m not making that in my own swimwear business, let alone giving it to an influencer. I’m way out of my league.”

Grace Garrick, founder of PR company MVMNT, recently revealed a creator tried to charge an “entire year’s salary” for a set of Instagram stories.

“Just let that sink in…an entire year’s salary for a story set when they do not have 100,000 followers,” she said in a video. “I have no words…that just takes the cake.

“Like I wanted to respond saying, ‘Did you accidentally put an extra zero on the end of this?’ Like, that is comedy…the audacity.”

Micro-influencer Simona responded to Garrick’s video, saying many creators had no framework for how they came up with that magic number when they invoiced brands and described it as like the “wild, wild west”.

With nearly 18,000 followers, the Sydney TikToker organises brand deals herself without the help of a manager and she set up her rates after doing a bit of market research.

“For people in my position, it is literally just a stab,” she explained to Yahoo Finance. “I reached out to other people with a similar amount of followers and said, ‘What was your rate?’ I had no idea.

“As I’ve developed slightly more of a following, I’ve become a little bit more fluent in the language that exists on email before the invoice is signed, and so the rates have gone up.”

She said how much she charges can also depend on how much she likes the brand. If she has a big association with the company, the rates might come down, but if it’s something completely out of her realm then the number goes up.

What has taken Simona by surprise is how brands haven’t scrutinised the numbers behind her number. She has rarely, if ever, been asked for analytics to justify why she’s asking for that amount of money.

“Every time I’ve said my rate, they’re like, ‘Great, let’s move, let’s move,” she said.

Despite being on the receiving end of influencer marketing, Simona wonders whether it’s actually a successful way of marketing a product to the masses.

“The fact that they invest in influencers this much kills me,” she told Yahoo Finance. “Because I honestly don’t think there would be that much of a conversion to sales.”

Taylor Reilly runs Reilly Talent, a management company which looks after some of Australia’s biggest creators. These people are on the other side of the scale compared to Simona and have millions of followers.

Tom Cruise standing next to Taylor Reilly
Taylor Reilly (right) manages some of Australia’s biggest creators and he said influencer marketing can be very hit and miss when it comes to converting social media posts to sales. (Source: Instagram)

He told Yahoo Finance that influencer marketing probably wouldn’t be the best for Bowen and her bikini brand at this stage.

“When you’re selling bikinis, that’s hard,” he explained. “What you’re selling is very competitive. You have to have something very unique in order to stand out.

“I think there’s a point in time to work with influencers, but if you’re a really small startup then no. If you’re a small startup, you need to treat your cash like it’s gold and make sure that every dollar you spend, you’re getting a return out of.

The entrepreneur said influencer marketing “to guarantee bottom dollar conversions” is like “gambling” in some cases and you never truly know whether the thousands or tens of thousands of dollars you give to a creator will give you a decent return.

Reilly explained that the number of followers a creator has shouldn’t be the metric used when they try to justify their prices for brand deals.

“It’s rubbish. It’s not real,” he said. “Like I have guys with, you know, 10 million followers. We don’t charge according to 10 million followers.

“It’s what views you’re bringing in, it’s what marketing power you bring into that business that they can [use to] justify the spend.”

His verdict on how much creators charge when they’re approached by brands is just simple business.

“Someone’s worth is valued by what someone’s willing to pay at any point in time,” he explained to Yahoo Finance.

By Stewart Perrie

Sourced from Yahoo! finance

By

Brewdog founder James Watt is set to launch a new business called Social Tip, a platform that allows users to become ‘influencers’ and earn money for promoting brands.

Social Tip has secured around £600,000 in seed funding from British tech early stage investment fund Haatch along with a number of angel tech investors.

Social Tip’s algorithm determines the value of user posts based on engagement metrics like views, likes, and overall interaction, rewarding users with cash. Brands such as Puregym, Huel and Dash Water have already signed up to the platform, which launches this summer.

It will also offer consumers the chance to monetise their posts by licensing images and rights for advertising and marketing.

Watt, who recently stepped down as Brewdog chief executive, described Social Tip as a modern twist on traditional word-of-mouth marketing.

“The most powerful marketing we ever had for BrewDog had nothing to do with us. It wasn’t the stunts, and it certainly wasn’t advertising. It was everyday people sharing their love for our products,” said Watt.

“Give me a choice between paying thousands of pounds to a social media personality to fake love my brand or rewarding masses of genuine, loyal fans, and it’s no contest,” he added.

Fred Soneya, co-founder of Haatch said that social content heavily influences how consumers buy products and services.

“Our attraction to investing in Social Tip is threefold; trust in paid advertising continues to fall, rewarding verified purchasers who share on social creates significant ROI for the brand whilst continuing to build loyalty with customers, and backing the B2B Platform which is distributed by the largest brands is the scalable strategy.

“With James at the helm, we’re excited to support Social Tip to become the first and fastest growing platform rewarding true [user-generated content] backed by verified purchases,” Soneya said.

But Watt has sparked controversy in the past for Brewdog’s marketing tactics. These include multiple run-ins with the Advertising Standards Agency (ASA), which banned the company’s advert claiming one of its beers could be considered one of your ‘five a day.’

In 2019 Brewdog and its former agency, Manifest, clashed over the launch of the alcohol-free beer, ‘Punk AF’, with Manifest founder Alex Myers alleging that BrewDog used the concept without credit or payment.

He has also faced criticism over Brewdog’s labour practices, including allegations of mistreatment of workers, claims he denies, and not paying the real living wage. Watt hit back at “ridiculous” levels of criticism following the saga.

Despite these issues, Watt remains as a board member and director at Brewdog, which he co-founded in 2007.

By

Sourced from CITY A.M.

By Tom Huddleston Jr.

This story is part of CNBC Make It’s The Moment series, where highly successful people reveal the critical moment that changed the trajectory of their lives and careers, discussing what drove them to make the leap into the unknown.

Amber Venz Box only wanted to earn a reliable income doing what she loved. She didn’t intend to help create an entire online industry.

The 36-year-old is the co-founder and president of LTK, a Dallas-based marketing company that connects more than 250,000 influencers and bloggers with over 7,000 retail brands with advertising budgets to spend. She’s credited as a pioneer of the creator economy with a business most recently valued at $2 billion, following a 2021 fundraise from Japanese investment holding company SoftBank.

In 2010, Box was an unpaid fashion blogger trying to promote her services as a personal shopper. She’d held some low-level positions in the industry: a fit model, an intern at Thakoon, an assistant buyer at a luxury boutique in Dallas.

When an article in The Dallas Morning News pointed readers to her blog, Box realized she’d made a mistake: Potential clients were reading her fashion tips and buying the clothes themselves. She wasn’t making a penny, and affiliate marketing — where blogs link out to retailers in exchange for a cut of sales — wasn’t yet commonly used in the fashion industry.

“That was an ‘aha moment’ of, I have to modernize my business so that I can actually continue to charge for the sales that I’m driving to my customers,” Box tells CNBC Make It. “That was the impetus for us starting [in 2011] what was RewardStyle, and is now LTK.”

She and her then-boyfriend, an electrical engineer and tech analyst named Baxter Box — they’re now married with four kids — adapted existing affiliate linking tech to fit her blog. Once she started making money, she realized she could sell the technology to other bloggers, who could benefit similarly.

Since launching, LTK has helped online creators earn at least $2.7 billion in pay-outs from retailers, according to the company. It has turned 240 influencers — all women — into millionaires, Box says.

Here, Box discusses the challenges of launching LTK, the risks of completely devoting yourself to an uncertain venture and where any aspiring entrepreneur should begin.

CNBC Make It: Can you describe the process of turning your fashion blog into an online business?

Box: [Baxter] saw me really struggling. We went for a walk one day, and he was like, “Anything’s on the table. How would you want to make money on this?”

My old business model [as a personal shopper] involved getting paid a commission. That seemed fair. That’s what I wanted to do here. So he researched and found some technology that we could apply back to this space.

I put between $500 to $1,000 towards engineering to get this going, and he did the same. I drew up, on PowerPoint, what I wanted it to look like. We met with this guy on the weekends and paid him piecemeal, hourly, to start coding it.

In 2011, we launched and I was able to start earning commissions.

Did starting a business feel like a big personal risk?

There was also almost no [financial] downside. I was in my early 20s, living at home, still eating my dad’s cereal. Worst case, this stays the same. Best case, you have a business where you get to do the things you want within this lifestyle that you wanted to create.

But there was a pressure of, “This better work, because I’m sacrificing everything to make it happen. And what if I do this for X period of time and it doesn’t? That’s going to just be this huge hole and pit in my life.”

I was spending 24 hours a day [on the business]. I was silencing phone calls. I was not spending time with friends. I abandoned a lot of relationships, and very quickly.

How confident were you that this would become a viable business beyond your own blog?

I was confident that people would be excited about it. Bloggers didn’t make money [at the time], and I knew that the second they made $100, that they would want to keep doing this. But I really didn’t know how we were going to pay the bills that we were incurring from hiring an intern, hiring an engineer.

One of the biggest challenges with retailers was getting them to believe that someone who had a website on the internet should be part of their marketing plan. The feedback I would often get was: “We work with celebrities or models. This is not part of our plan. We are a luxury brand, we are elevated.”

There were two key businesses at the time that were selling [luxury items] online, ShopBop and Net-a-Porter. I basically asked them to pay me a commission for the online sales that I was driving, and that’s when the business really took off.

You started LTK before most people knew the term “creator economy.” Did you feel like you were ahead of the curve?

No, I really didn’t even think of it as an industry. I struggled until 2015, when we fundraised for the first time, to try and explain the space that we were creating — articulate it in a way that investors were interested in.

I was talking about blogging, young girls on the internet, fashion. I was a young girl. This was my first business and I was from Dallas. It was very challenging to get investors excited about it and raise money around it. Most of the comments were like, “I’ll ask my wife,” or “I’ll ask my girlfriend.”

We raised $300 million [from SoftBank] in 2021. I think it’s probably one of the largest investments, if not the largest, in the creator space. That was when the industry, to me, really arrived.

What’s your best advice for recognizing a window of opportunity and deciding to commit to pursuing it?

The time isn’t “always now” — it’s always yesterday. If you have a real problem, then other people have that problem too. Solve it now, because someone is going to eventually be able to solve it.

It’s who gets there fastest, spreads the word and builds that community around it best. And that’s with almost every decision as a founder — you move with urgency to win.

This interview has been edited and condensed for clarity.

Feature Image Credit: Amber Venz Box, 36, is the co-founder and president of influencer marketing company LTK. Source: LTK

By Tom Huddleston Jr.

Sourced from CNBC make it

By Marilyn Stone

Researchers from LUISS Guido Carli University have published a new study that examines whether and how subtle shifts in language arousal might shape consumer engagement and the way it affects perceptions of influencers’ trustworthiness.

The study, published in the Journal of Marketing, is titled “How High-Arousal Language Shapes Micro Versus Macro Influencers’ Impact” and is authored by Giovanni Luca Cascio Rizzo, Francisco Villarroel Ordenes, Rumen Pozharliev, Matteo De Angelis, and Michele Costabile.

Companies increasingly turn to popular personalities to promote their brands, products, and services. The influencer marketing economy was valued at $21.1 billion in 2023, and more than 90% of brands enlist influencers with a small audience (micro) or with massive reach (macro) to connect with consumers and achieve a variety of marketing goals, from creating awareness to increasing sales.

Influencers have the potential to diffuse marketing messages and drive actions, but it is unclear why some of their posts get a lot of engagement while others do not. One possibility is that consumers are increasingly aware that influencers get paid to promote products, raising questions about their motives. Additionally, anecdotal evidence suggests that when influencers use high-arousal language (e.g., “it’s totally amazing!”), it leads to questions about their trustworthiness, which in turn leads consumers to engage less with the content.

Micro vs. macro influencers

Consumers typically see micro influencers as regular people, so if they say something like “this shake is AMAZING!” consumers believe they really are excited about that shake and just want to share this discovery with their friends and followers. This belief in their sincerity increases consumers’ trust in micro influencers.

However, macro influencers do not seem like regular people. Consumers know these influencers receive substantial sums to say positive things about products, so they judge their posts as an attempt to persuade, just like any other form of advertising. Believing that someone has manipulative intentions tends to decrease trust. Yet the negative effect of high arousal posts by macro influencers could be mitigated if their posts offer more informative (vs. commercial) content or if the messages are more balanced.

The researchers collaborated with an influencer marketing agency to acquire a sample of 20,923 Instagram-sponsored posts across industries from 1,376 U.S. influencers. They measured engagement as the sum of likes and comments that a post receives. To measure language arousal, they combine a words-based lexicon (including terms like “hectic,” “amazing,” and “sensational”) with paralanguage (i.e., exclamation marks, capitalization, and emojis).

They used 100,000 followers as the cut-off to classify micro versus macro influencers. To measure how informative the post goal would be, they validated a dictionary with words like “explore,” “read,” and “watch.” Finally, more than 100 controls were employed, including details about the influencer, the text and images shared, and so forth. Combining the field data and controlled experiments led to some compelling results.

The researchers note, “For micro influencers, we find that a 10% increase in arousal is associated with a 5.4% increase in engagement, on average. Recommending a product by saying, ‘It’s superb’ rather than ‘It’s great,’ for example, would attract 49 additional likes or comments. However, our findings raise concerns for macro influencers. If macro influencers increase arousal in their posts by 10%, it reduces consumer engagement by 8.4%, on average.”

However, macro influencers are not completely forbidden to express excitement. Since signalling an informative goal is associated with a 1.8% increase in engagement, they can share informative rather than commercial posts. Also, admitting some concerns or noting some negative aspects of the promoted product can help macro influencers seem more genuine, which also increases engagement.

Finally, macro influencers can use high-arousal language if they also include words that signal trustworthiness (e.g., “learn,” “help”). Thus, brands and macro influencers should collaborate to make sure their posts include phrases like “that’s what I learned about this incredible product” rather than “that’s how to use this incredible product.”

From Instagram to TikTok

These findings are not limited to Instagram. The study provides evidence that language arousal also plays a role in TikTok, with relevant influences on its young target market. “We gauge influencers’ vocal cues and the level of pitch in their voices as proxies for arousal. A higher pitched voice can signal greater arousal, and in line with our Instagram study, we determine that a higher pitch, and higher arousal, voice exerts a negative effect for macro influencers,” the researchers say.

This research underscores the importance of aligning social media posts and language arousal strategies depending on the type of influencer. For micro influencers, using high-arousal language authentically can enhance , but macro should focus more on informative content to maintain their trustworthiness.

Exploring the impact of arousal on emerging platforms like TikTok is especially crucial when it comes to targeting young, savvy consumer audiences effectively. This research could be extended to politicians, scientists, and other high-profile individuals and the statements they issue.

Feature Image Credit: Unsplash/CC0 Public Domain

By Marilyn Stone,

Sourced from PHYS.ORG

BY KARTIK JOBANPUTRA 

The convergence of ecommerce with social media influencers creates a dynamic symphony of trust, engagement, and sales.

The digital revolution in ecommerce has brought forth numerous innovations, with the role of social media influencers standing out distinctly. These online mavens, each with distinct flair and following, are crafting a new narrative in online marketing. Central to this transformation is social commerce, an innovative strategy that weaves shopping into the tapestry of social media.

Unpacking the phenomenon of social commerce

Social commerce signals a paradigm shift in how consumers experience online shopping platforms. Rather than the traditional browsing and searching, it offers a richer, more engaged shopping journey. Modern consumers, especially those in the millennial and Gen Z demographics, are tightly intertwined with their social media accounts. Platforms like Instagram, TikTok and Facebook aren’t just for entertainment; they serve as lifestyle compasses, guiding users in everything from pop culture to shopping choices.

In this digital landscape, influencers have carved a niche for themselves. Their content, genuine and relatable, shines bright amid the bombardment of traditional advertisements. When these influencers vouch for a product, it’s seen not as a sales pitch but as a sincere recommendation. Augmenting this is the allure of convenience that social commerce brings. The process is incredibly streamlined; one can spot a product on a post or story, swipe or click on it, and be led directly to an online checkout. The entire experience is swift, smooth, and satisfying.

The inimitable role of influencers

At the core of the social commerce machine are influencers. These individuals, with their varied followings, are more than just digital personalities; they’re pillars of modern marketing. Unlike celebrities who might endorse various products, influencers are selective, ensuring their endorsements often stem from personal experiences and align with their brand. This selective approach, combined with their domain-specific expertise, makes influencers trust magnets.

For instance, a beauty influencer’s tips on skincare are valued because they’re backed by experience, while a tech influencer’s gadget review is awaited for its depth and authenticity. Additionally, influencers prioritize engagement. Their interactions aren’t limited to broadcasting content. They chat, conduct polls, share snippets of their lives, and create a shared digital space with their followers. This two-way communication fosters a bond, a digital kinship that’s deeply valued. Another feather in their cap is their expertise in visual content. In an age where visuals dominate, influencers, with their compelling images, videos and stories, hold their audience’s rapt attention.

Strategic collaborations for mutual growth

The collaboration between brands and influencers is multifaceted. There is sponsored content, where influencers create posts or videos infused with their personal experiences with products. While promoting, they ensure transparency, often tagging these as #ad or #sponsored. Then there’s affiliate marketing, a performance-centric approach where influencers reap rewards based on the sales generated via their unique links.

Some collaborations transcend regular promotions. Think of a renowned beauty influencer launching a limited-edition product line with a major brand. Such initiatives blend the influencer’s personal brand with the product, promising authenticity and unparalleled quality. Beyond these, some brands envision a longer journey with influencers, turning them into brand ambassadors. This deep relationship ensures that the influencer becomes an enduring face and voice for the brand.

Enduring impacts and considerations

The synergy between brands and influencers leads to tangible benefits. Enhanced brand recall, exponential growth in sales and spikes in website traffic are common positive outcomes. On the trust front, influencers act as a bridge, lending their credibility to the brands they endorse. However, like all strategies, this one isn’t without pitfalls. Over-commercialization can dilute an influencer’s authenticity.

Moreover, ensuring that the influencer’s personal brand aligns with the corporate brand is crucial. Then, there’s the challenge of measuring the intangibles. While metrics like clicks, views, and sales are straightforward, quantifying trust or brand perception remains nebulous. It’s also crucial to remember that influencer marketing isn’t an unregulated frontier. Clear guidelines, especially about disclosures, exist, and both brands and influencers must adhere to them to maintain credibility and avoid legal pitfalls.

Conclusion

The convergence of e-commerce with social media influencers creates a dynamic symphony of trust, engagement, and sales. For consumers, it offers a shopping experience that’s rich, trustworthy, and interactive. For brands, it’s a golden ticket to visibility and authenticity in a crowded digital marketplace. Looking ahead, with innovations on the horizon, this partnership promises to redefine the retail landscape further. In a rapidly evolving digital world, the bond between e-commerce platforms and influencers is beneficial and essential. They aren’t just changing the game – they’re crafting a new one for the next generation of online shopping.

BY KARTIK JOBANPUTRA 

ENTREPRENEUR LEADERSHIP NETWORK® CONTRIBUTOR

Founder & CEO Benevolent by nature, Kartik is a diverse man of diverse and unpredictable choices, a serial entrepreneur. One may find him not just reading stoics or seizing the present like jumping off a plane. He is pro skydiver/licensed scuba. He doesn’t speak in hypotheticals and lives life by doing.

Sourced from Entrepreneur