Influencer Advertising 101, Half 1: What Is It?

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What do Kim Kardashian, Armando Roggio and your neighbor have in common? They are all influencers.

Influencer marketing is the digital equivalent of word of mouth. Within e-commerce, we can divide influencers into three categories: celebrities, authorities and colleagues.

3 types of influencers

Celebrities. Most consumers consider an influencer to be a celebrity. Celebrity influencers aspire to it because they sell what others might aspire to. For example, millions of Gen Zs (roughly under 25 years old) and Millennials (25 to 40 years old) model their purchases after Kim Kardashian. They want the same makeup, food, and clothes.

Aspirational influencers are usually expensive and correlate to audience size – the bigger the more expensive, especially for a mega audience with 50 million or more followers. I’ve seen fees of $ 500,000 and up for an audience of this size.

For e-commerce retailers, the practical considerations for using celebrities depend on how broad the appeal of a product or service is and what risk tolerance there is. Gigantic audience means loose targeting. This is why you will see Kim Kardashian with 219 million followers on Instagram promoting Uber Eats and other generic categories as a large chunk of her followers will likely find them useful. Niche products with a narrow focus tend to have poor ROI with ambitious influencers.

Celebrity influencers like Kim Kardashian offer large audiences – and high risk for traders. Kardashian has 219 million followers on Instagram.

The risk of using celebrity influencers comes from spending the money (or, in some cases, part of a business) hoping that a single voice will drive the response. Celebrities can of course make a huge impact. But they’re not for the faint of heart and out of reach for most ecommerce retailers.

Authorities. Authority is synonymous with expertise. Armando Roggio, longtime senior executive at Practical E-Commerce, is an authority. He has written nearly 300 articles and hosted many dozen webinars. He is also a trader, marketer and web developer. He is an e-commerce expert.

The readers of Armando’s works trust his opinion.

There is one caveat with authoritative influencers, however. Career confidence can quickly be lost if its credibility is questioned. Hence, authoritative influencers need to be extremely careful about the products and services they vouch for. As with celebrities, acquiring influence from government agencies can be expensive, albeit less than that of celebrities. In addition, the risk of using public authorities is lower because their target groups are more focused on the advertised products and services.

Peers, Micro influencers, nano influencers – all are arbitrary names for the most common type of ecommerce influencer. You are best understood in the context of your neighbors. For example, let’s say you bought a Tesla because Kim Kardashian did it. That is desirable. But what if all of your neighbors buy a Tesla? Regardless of how you think about the product, you are probably wondering what they know you aren’t. Peer influencers are the digital equivalent of keeping up with the Joneses and realizing the trust we place in the opinions of those we know.

Peer influencers are generally the cheapest and easiest to test. The cost for influencers with fewer than 1,000 followers is only $ 10.

Peer influencers are generally the cheapest and easiest to test. In this example, “complete.maginlee”, a mother from Los Angeles with around 16,000 followers on Instagram, advertises a linen brand.

Ecommerce merchants often create campaigns with a group of peer influencers and then apply filters such as geography, interest, network, number of prospects, and other variables.

Peer influencers carry a much lower risk. A 50 million audience made up of 50,000 peer influencers has a higher probability of success than a similarly large audience made up of one person. Spreading the risk and paying less is why ecommerce brands flocked to peer influencers.

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