Do the risks of influencers outweigh the benefits?

Corporate communications teams have myriad risks to consider in their daily and strategic work, but amongst them, have many considered those posed by social influencers? The issues raised by these major players in social media have been brought into sharper focus by the IPO documentation for mattress-in-a-box company Casper and online fashion company Revolve, where both cite social influencers as a potential risk.

These documents suggest that influencers could pose a risk if they failed to follow guidelines to prevent misleading advertising, if they posted negative reviews resulting in a damage to brand reputation or if they did not reveal their relationships with firms.

Kinda Jackson, managing director of digital at communications agency Brands2Life, explains: ‘Social influencers are a risk to a brand’s reputation in the same way a celebrity or a supply-chain partnership could be if anything were to go wrong. If a celebrity says or does something horrific or even something just out of alignment with the brand’s target audiences it can trigger protests, boycotts and all those entail.’

Scott Guthrie, an independent influencer marketing consultant, makes a similar argument. ‘It is an obvious point to make, but one worth making: social media influencers are humans rather than billboards,’ he says. ‘As such, brands cannot completely immunise themselves from the chances of influencers making poor decisions. They can, however, greatly reduce the risk of such fracas fomenting.’

The attraction of influencers on social media platforms to some companies is easy to understand, with Instagram having reached a whopping one billion monthly users. Lewis Wilks, associate director at PR agency Lansons, explains: ‘The benefit of working with social influencers is that they give brands access to a potentially large target audience that they might not otherwise reach and engage, and the opportunity to do so with content that is authentic and trusted.’

And this applies to organisations whose products are targeted to a specific demographic. German database company Statista found that 64 per cent of 18 to 29-year-olds in North America use Instagram. Within this, there is a small female bias, with 38 per cent of female Internet users of all ages being Instagram users, compared to 26 per cent of male Internet users. Andy Rivett-Carnac, partner at corporate communications consultancy Headland, explains: ‘Using social influencers is a balance of risk and reward. Any influencer would say it is comparatively a lot cheaper to deal with or contract an influencer than take out a display ad or even a Super Bowl ad [rumoured cost: $5.6 million for a 30-second slot] to get to a mass audience. And arguably, social influencers are more persuasive.’

The paradox for Guthrie is that, in the risk narrative, both Casper and Revolve have been catapulted into billion-dollar valuations, based in large part, on their application of influencer marketing. He adds: ‘In this context, the term influencer is probably no longer fit for purpose. Influencer marketing has become an umbrella term which envelopes celebrity endorsement, micro-influencers, nano-influencers, brand advocates, influencer advertising, review sites and affiliate marketing.’

Casper, Guthrie highlights, was at the vanguard of affiliate marketing through working with review sites. ‘It then fell out of love with the practice and sued three such review sites. It also worked with Kylie Jenner – a reality TV star turned social media celebrity and latterly cosmetic company mogul.’ Revolve works with an army of 3,500 advocates and micro-influencers. Therefore, given the complexity of the social influencer field, what should companies do to restrict the risk?

‘To protect themselves, brands need a clear strategic view of how, why and which influencers to work with,’ states Jackson. ‘They should be forensically validating influencers, beyond just their social reach, and conducting a deep dive into an influencer’s background, from the quality of their content, previous partnerships, their relevance to the brand’s category and exactly who their audiences are and how they engage.’

Doing such rigorous research alleviates the risk of brands committing self-sabotage by recruiting influencers who have demonstrated inappropriate behaviour or engaged with unsuitable or damaging content, says Jackson. ‘Companies often fail when they are blindsided by the data that can be pulled from the many influencer identification tools out there and don’t look beyond the follower numbers to assess brand-fit thoroughly enough.’

Therefore, Wilks says social influencers can offer a company a good and effective promotional outlet, but only if the relationship works. ‘An influencer’s greatest asset is their relationship with their followers and the insight this offers brands into how best to engage that community. ‘Social influencers are passionate about protecting this relationship and will prioritise their audience’s needs over anything else. It’s why they inspire such loyalty from their followers and can be effective collaborators, when given the space to ‘do their thing’. Brands working with influencers must therefore respect their editorial independence in order to optimise the partnership.’

‘Influencers should never be left to go rogue,’ contests Jackson. ‘This in no way means that companies have to be prescriptive in terms of the content that an influencer should produce, as the value of influencers lies in the authenticity of their content and the way their social following appreciate and engage with that content: after all, they have amassed a following by understanding the needs of their audience and delivering content that resonates.’

Influencers should never be left to go rogue

Ultimately, the company-social influencer relationship is a contractual arrangement and brands should not be afraid to make stipulations as part of negotiations, says Wilks. ‘Be clear what is a regulatory requirement, what is a condition of the brief and what is simply a guide or preference. Request a sense-check of content before it’s published. In my experience, most influencers are amenable to that, particularly when working with brands in highly regulated sectors where they may not be familiar with the law.’

Jackson concurs: ‘As with any marketing partnership, there should always be a contract in place and a human being helping to manage the relationship, ensuring that the content meets the brief and objectives in hand, and adheres to all legal standards.’ ‘Influencers pose a risk when necessary due diligence is not carried out and a relationship is mismanaged,’ adds Rhian Robinson, senior account director and influencer lead at Battenhall. ‘Successful influencer activations rely on working with the right people, in the right way and managing the relationship effectively.’ However, notes Jackson, companies should not only have final sign-off before content goes live, but should also thoroughly check content throughout the duration of the campaign, to avoid any scenarios that could potentially damage reputation. ‘This includes doublechecking that the content aligns with Advertising Standards Authority guidelines,’ she adds.

If social influencers pose such risks, how have we got to a position where social influencers have amassed so much power? ‘True social influencers have amassed a following by producing content from a place of passion,’ notes Jackson. ‘People follow them because they feel connected to the content they are posting as it resonates and speaks to them in a way that’s ‘human’.’

She adds that, to a social audience, they are either people like me or people that I want to be. The truth is social influencers work on many media levels: they are entertainers, news providers, product recommenders and people truly understand them. ‘The ‘power’ for companies is that people choose to follow a social influencer meaning they are essentially a captive audience,’ notes Jackson. ‘Working with influencers can be powerful if a brand can fit into an influencer’s storyline in a way that feels natural and fits seamlessly into the audience’s expectations in a way that advertising does not.’ Rivett-Carnac agrees, highlighting there are two elements to the social influencer power base. ‘First, the size of the audience due to the digital revolution means it is easy to get huge reach. Second is the nature of the relationship – there is a real relationship between the audience and the influencer compared to traditional advertising channels.’

There has been a growth in companies embracing the social influencer approach for one simple reason, notes Guthrie, adding: ‘Because it works.’ He believes wider business, sociological and psychological perspectives have also played a role in the rise of social influencers. ‘Institutions no longer enjoy our blind trust. Nor do big brands. Nor big business. Nor religion. Nor Government. Nor the media, as a whole. We do, however, still trust people like us,’ he says. ‘We feel that influencers are those people. People we can relate to. Their experience becomes our evidence. We follow their recommendations. We don’t yet see their content as advertisements.’

Guthrie suggests that as consumers, we have grown ‘savvy’ – and are therefore immune to the guile of advertisers. ‘We’d rather trust the opinion of someone just like us, someone who’s really used the product, to tell us whether the product works or not and whether it’s worth the purchase price.’ He notes that beyond immediate friends and family we have turned, by extension, to social media influencers. ‘They are people like us – but at scale,’ he notes. ‘We find them more relatable, more engaging than traditionally authoritative voices. A less polished, more authentic, intimate voice which moves us to change our behaviours or opinions.’ Guthrie also suggests that the way we discover brands has changed. ‘A brand is no longer what the brand tells the consumer it is. Today, a brand is what consumers tell each other it is. We turn to Google to search for product research. Increasingly, we turn to social media. Over a third of 16 to 24-year-olds now use social media as part of their product research process. And, on social media, we are three times as likely to follow a social media influencer than we are to follow a brand directly.’

We trust people like us

This puts into perspective where the power of social influencers comes from, but in turn, raises a big question about how social influencers can be controlled by companies. ‘Problems with control arise when brands enlist the help of third party platforms who make promises of ‘reach’ by touting the brief and putting it out to a data base of influencers that haven’t been vetted for their relevance to the brand or campaign,’ warns Jackson.

In addressing the issue of how social influencers can be controlled by companies, Robinson, offers a three-pronged approach. First, identify and engage the right kind of influencer. ‘Prioritise authenticity and genuine engagement over follower numbers. Find influencers who already like your brand – that’s half the battle.’ Second, work collaboratively. ‘Don’t stifle their creativity or ideas. An influencer understands their audience better than any brand, and will know what works,’ she says. Lastly, formalise the company-social influencer relationship with detailed briefing documents, agreements, deliverables and contracts. ‘Treat an influencer as you would a journalist.’

Guthrie offers similar guidelines. ‘Follow a systematic process for working with influencers and by creating long-term mutually beneficial relationships with them. It starts with the 4SFilter: Search, surface, screen and select.’ Firms should ‘search for influencers according to strategic insight into who you are trying to influence and how you plan to measure the influence. What are your various stakeholders’ motivations and interests? What type of content do they consume? Where do they hang on online?’ he advises. Then ‘surface’ a long list of potential influencers to work with based on mapping their audience on to the particular brand’s audience. ‘Are their audiences the right age and gender? Is where they live relevant to your cause?’

Whittle down this list by screening each of the potential influencers. ‘This combines hard measures and softer ones,’ Guthrie says. ‘Has the influencer bought followers or engagement in the past? Have they worked recently with one of your competitors? Have they mentioned your brand’s name in past content? If so, was the sentiment positive or less than glowing? Does the influencer share the same values and world-view as that of your brand? Is their tone of voice commensurate with that of your brand? ‘Within the ultimate selection phase you need set out expectations for the relationship through a creative brief and contract – written documents. This is where you lay out content deliverables, remind them about disclosure regulations and explain what the content approval procedure is.’

The final stage involves the mechanics of payment. ‘This is where you include a cancellation, or takedown, clause. This can be activated on the basis of nonperformance, poor performance, or breaking brand rule guidelines or disclosure regulations.’

For Jackson, there is a simplicity working with social influencers: it is essentially another form of marketing partnership, and needs to be managed in the same way – by humans. ‘If you have identified the right influencer, completed the due diligence in terms of background checks and validations against the brief, have a water tight contract that outlines expectations, have final approval of content prior to posting then that’s all the control you need,’ she says. ‘What’s needed is a mindset shift, moving from treating influencers as just another tag-on marketing channel to a programme of sustained, validated relationships. Developing meaningful partnerships between brands and influencers that make sense requires a smart, strategic and professional approach.’

She adds: ‘Problems arise when companies use influencers for a one-off activation, such as a product review, which are now increasingly met with cynicism from social audiences who have grown tired of this and lost trust in this type of endorsement. Long-term relationships with the right influencers can deliver significant value for companies. The complexities of working with influencers may make it appear that advertising is essentially less risky, but such a view is misguided.

‘Advertising is messaging to the masses, written and created by humans and then consumed by them. Often new advertising regulation is created off the back of an epic fail. The advertising rules and regulations have evolved tremendously over the years due to new legislation and consumer feedback – complaints – and yet advertisers, to this day, still take risks with their messaging.’

Advertising is messaging to the masses

Putting the rise of social media and influencers in perspective, Jackson adds: ‘I remember the days when social media was seen to be a risk to companies due to the fear of negative backlash from consumers. Companies responded to this ‘reputation risk’ by having clear strategies, understanding the of role social, audience profiling and having stringent community management measures to negate unfavourable consumer comments. Companies need to adopt the same smart and strategic approach to influencer marketing.’

Guthrie adds in a similar vein: ‘Influencer marketing is a reaction to traditional forms of advertisings. Like antibiotics, legacy advertising is becoming less effective year-on-year. Influencer marketing, done well, achieves far greater results.’ ‘Working with influencers is a dynamic process’, he adds. ‘The relationship doesn’t begin and end with using algorithms to identify online creators based on reach, relevance and resonance alone. Instead, brands need to continually validate and measure influencers’ fit against the company’s values – both at brand and corporate levels.’