Which Type of Business Models Work Well with Influencer Marketing?
Source: Freepik
It’s no secret that we are a fan of influencer marketing, content creators, and KOLs at Slice. We believe that there is tremendous potential both for advertisers and for the creators. Brands get awareness and sales, while creators get paid sponsorships and brand association.
Like any advertising medium, the brand/channel fit is important. Car companies are a high touch, low frequency purchase versus a low touch, high frequency purchase of a candy bar. Using the same channels the same way would not make sense.
It’s well known that the top industries that invest in influencer marketing are:
Fashion and Beauty
Travel and Lifestyle
Health and Fitness
Food and Beverage
Entertainment and Media
Software and Technology
Within each industry are different types of business models. Let’s take a look at these models and see which are best fit for influencer marketing campaigns.
ALSO READ : How to Approach Influencer Marketing During a Recession
Online Subscriptions
Source: Freepik
Online subscriptions can include any business that requires a recurring monthly payment. This can be for things like software or monthly boxes of a particular product. Examples of this would be Squarespace (creating websites), ButcherBox (meat), or MasterClass (online classes).
There are several reasons why online subscription businesses work well with influencer marketing metrics.
Digital Coupons - it’s easy to create digital coupons to attribute the purchase referral.
Calculate ROI Easily - With any online subscription, the brand would understand what their typical customer acquisition cost is vs. their lifetime customer value. Tracking new sign ups with influencer promo codes would help calculate ROI of the influencer spend.
Direct to Consumer Brands (DTC)
Source: Freepik
Direct to consumer brands are unique in that they own all aspects of their sales and distribution. They fully control the website they sell their products on and they handle fulfilment of the shipments. This gives DTC brands more control and information when it comes to their marketing and sales that they might not have with an Amazon shop.
Like online subscriptions, DTC brands can offer digital coupons to track which influencers referred customers to their website and who ultimately made a purchase.
Additionally, since they control the entire purchase experience, they can easily add a questionnaire or survey on the post-purchase page to ask questions like where they heard about the product first so they can attribute the sale to a channel to gauge effectiveness.
Ad-Based Media and Technology
Source: Freepik
Really? Yes. These business models only work with a large pool of active users. I’ve seen countless influencers promote mobile games or new apps. This is a perfect fit for both parties due to several factors.
Downloads are free (mostly). Influencers don’t have to convince their audience to buy anything. They just have to entice them to have fun or a different benefit the technology offers. This is obviously an easier sell than telling someone they can get 10% off a $1,000 mattress.
The call to action is very easy. You can download an app within two clicks. No tedious forms to fill out. Reduces most of the friction from the path to purchase (or download).
Brands can track ROI easily with deep links to their app. Analytics like AppsFlyer make it easy to track download attribution so there is no need for the extra “promo code” step that you’d have to do with an ecommerce purchase.
Influencer marketing can really work with any industry and any business model. Fast moving consumer goods is an example of an industry that needs influencers and has plenty of budget to spend on influencer marketing. But they typically don’t own their distribution channels and their average cost per purchase is low so affiliate incentives are difficult.
If you’re looking for help with your influencer marketing or need a way to better manage your creator relationships, reach out to the Slice team and we can share with you how Slice can help you build your influencer and content creator relationships.