Calculating success in Influencer marketing
"How do I know if my influencer marketing campaign has been successful?" This is a common question among newcomers to the industry. Analysing the results of a campaign can sometimes be the trickiest part of the whole affair. So, how can you tell if your efforts with influencers have paid off? Let’s break it down.
There’s not always a single answer to this question because success is relative to your goals and your investment.
Some success metrics are more straightforward to define than others: it’s easy to look at how many sales you made in a certain period. And you can check your brand’s social media account to see how many new followers you’ve gained during the campaign. But what about that photoshoot an influencer did in your newly opened restaurant? Or, what about the online article that was written about your brand?
‘I want to increase sales.’
Conversion rate is one of the easier success metrics to define because the value for money based on ROI is reasonably simple to calculate. (Read about the KPIs for influencer marketing here!)
Let’s say you’ve recently launched a new tech product in your e-commerce business, and you want to increase sales of your recent release. Let’s work with round numbers for the sake of argument: each unit costs $200, and you pay an influencer $2,000 to promote them on social media. To break even, you need the influencer to help you sell at least ten units. At the end of the activation, you find they ended up actually selling twenty-five. Now your income is $5,000, your investment was $2,000 and the net profit to your campaign is $3,000. You can confidently declare that the campaign has been a success.
Conversion rate an easy example to work with because the value is evident. However, some key performance indicators in influencer marketing are not as easily quantified. For instance, when running a branding campaign, how much is an impression actually worth?
‘I’m working on brand awareness and want impressions.’
Brand awareness has qualitative and quantitive aspects to it, and unlike sales, it doesn’t come down to a hard number. When you can’t calculate the exact monetary value, relate it back to your original objective. Did you exceed what you had planned to achieve?
Let’s think about impressions: let’s say you own a newly emerging cookie business and need to focus on marketplace awareness. You contract an influencer to discuss various cookie flavours on Instagram, using your products to run a chocolate chip vs peanut butter cookie poll. You give them a package of free products valued at $10 and pay them a $100 fee in exchange for three Stories about your brand.
Based on the influencer’s 50,000 followers and their past Instagram Insights data, you estimate you'll receive around 15,000 impressions per Story. Therefore, your estimated impact would be 45,000 impressions (15,000 x three Stories), and your investment would be $100.
Cost per mille (CPM) is a formula to calculate the cost per thousand impressions. Using the figures in the paragraph above, the estimated CPM for this campaign would be $2.22. So, for every 1,000 impressions, you spend $2.22.
Now, let’s say the influencer loves your products so much that instead of creating three Stories, they do five. And when they send you their Insights data on recorded impressions, you see that the total is actually 80,000, not 75,000. So, when you recalculate your CPM, you’ll find that it’s $1.25, which is lower than your original estimate.
This is another way to see that you’ve been successful. Even if the value of impressions can’t be reduced to an exact dollar figure, you can see that you’ve surpassed your goal and spent less money doing so than you anticipated.
The bottom line...
In all marketing efforts, success is relative. You need to find and record all the ways that your campaign had a positive impact. Some of these are straightforward marketing metrics and can be easily measured. Others might not occur to you at first but should still be considered. Always relate your results back to your objectives and investment. Look for all the ways the campaign benefitted your brand. And if you find the campaign didn’t succeed this time, don’t be downhearted. Use the all-important data to see at which stage things went off plan and assess: did the campaign underperform, or were the success metrics too optimistic? Or, place it all in the hands of industry professionals and achieve activation success you never dreamed possible!