Over the past decade, we’ve witnessed the rise of influencer marketing become a $16.4 billion industry. While there have always been peaks and valleys in retail, influencer marketing has remained resilient.
In the current economic downturn, the need for an appreciation and understanding of the power of creator-driven marketing and commerce has never been stronger. Influencer marketing budgets will be scrutinised, but LTK has seen spend on campaigns grow over 50% in Europe this year.
Brands are tethering themselves to the future of creator commerce, where content creators share, style, and recommend their favourite products to their followers. They can ensure success through leveraging a creator’s expert voice to show a product’s benefits to their audiences – on whatever platform.
The key: authenticity
Creators develop a more authentic connection with their audience, who value their guidance when making purchases and look to them as trusted experts. This is especially important now, with consumers seeking value and quality from their purchases with rising inflation. They will look for authenticity from brands more than ever.
Creators have the power to deliver this. They’re particularly influential over key demographics like Gen Z, with 92% relying on influencers to inform their purchases across virtually every category. Through their tailored recommendations, sometimes on a personal, one-to-one basis, creators can help to humanise brands.
This goes beyond just brand awareness. Creators have a following of high-intent shoppers, meaning they will see increased engagement, sales and conversion compared to other marketing channels. According to our research, creators are four times more influential to consumers than celebrity posts and also ranked above social ads.
Work with MATCHESFASHION
The luxury brand wanted to grow its presence in the US and attract new affluent female shoppers.
To achieve this, LTK found US-based creators that had an established affinity for MATCHESFASHION and aligned with its audience targets, to create a more authentic interaction for shoppers.
Working with genuine lovers of the brand meant creators were able to deliver unique, creative content that converted sales. MATCHESFASHION’s US market share grew to 40% as a direct result of the campaign, with LTK platform sales increasing by 47% year-on-year in the US.
After seeing the impact creators had in driving success, MATCHESFASHION made the decision to move beyond one-off campaign moments to building creators into brand ambassadors. This is part of an evolution of how brands are working with creators – using them as ambassadors with tentpole moments sprinkled throughout the year.
The brand can now grow alongside the creator’s audience, with MATCHESFASHION able to incorporate phase-on-phase performance metrics into ongoing campaigns to ensure return on investment (ROI) is continually being maximised.
Given the pressure on budgets, greater emphasis is placed on full-funnel performance instead of metrics such as reach, engagement and clicks alone. The value of creators is stronger than ever and brands are thinking more strategically about the role creators can play in full-funnel marketing plans.
Brands today rely more on creators to help drive sales impact, but creators are supporting far more than sales. We’ve seen more brands relying heavily on the creator content itself, boosting it on social channels and licensing it to use across their marketing – including websites, ads, point-of-purchase, catalogues and more. Creators are the brands’ power partner, demonstrating ROI throughout the funnel during a time when they must go even further to justify spending.
With the right creators in place, brands can optimise performance by monitoring real time statistics and reactively upweighting spend on top performing creators, to drive further engagement and conversions.
Existing performance data gives brands insights into the creators’ content style, category offer and price point, as well as the brands that a given creator has previously partnered with. By using a platform with proprietary sales data and performance insights, a brand has the ability to identify the right creators proven to convert for it or its competitors. Trusting the data, and balancing with the human insights gleaned from one-to-one relations with the creators, means brands can accurately identify which creators can deliver depending on the objective and real-time measurements.
The right time to invest
During this period, many could assume consumers will try to avoid spending their disposable income frivolously. But our recent YouGov research found British consumers continue to treat themselves for the right items and price point despite the cost of living crisis.
And brands are taking notice. In H1 alone, we saw a more than 50% YoY increase in spend with LTK Creators from brands. We believe that it’s now more important than ever for brands to prioritise investment in influencer marketing programmes.
Consumer engagement with shopping ads may fall during the squeeze but they won't be unfollowing their favourite creators. As creator commerce continues to mature in the UK, we are seeing creators become the new retailers, used to drive sales into new categories – such as FMCG – as people look to creators to help with recommendations on everyday life. Because of the influence and impact they have on consumer purchase decisions, and the impact they can drive throughout the marketing funnel, creators are going to play a much larger role in wider business strategy in 2023.
The bottom line
This is a difficult time for many of us, and as consumers we want to see brands sympathise with our experiences and connect with us on a human level. Creator marketing helps bridge the gap between brands and consumers – creating awareness, building loyalty and driving sales. This will not only improve the shopping experience for consumers but maximise conversion for brands and creators.
Head of Sales – LTK Europe