Have you ever wondered how effective influencer marketing is?
On an average, businesses make $7.65 for every $1 spent on influencer marketing. There’s no doubt that influencer marketing is the hot thing in the industry, and you should be taking advantage of it.
Blindly investing in influencer marketing is a dangerous move. You should have a proper strategy for targeting the right influencers, and most importantly, measuring the effectiveness of your influencer marketing campaigns.
In this article, you’ll learn some of the best ways to calculate the effectiveness of your influencer marketing campaigns.
Biggest Challenges in Influencer Marketing
But before we begin, let’s take a look at the top challenges faced in influencer marketing.
Challenge #1 - Identifying the Right Influencers
The main challenge of any influencer marketing campaign is identifying which influencers are right for your brand. If you do this wrong, all of your time and resources will be wasted.
73% of marketers say that identifying influencers is their main challenge with influencer marketing.
Before you begin any influencer marketing campaign, do proper research about your target audience, and understand where they hang out.
Then find influencers who have the same target audience as yours.
Challenge #2 - Measuring Influencer Marketing ROI
For 78% of marketers, measuring influencer marketing ROI was their number one challenge in 2017. That’s a big percentage considering the amount of money invested in influencer marketing. And failing to measure the ROI makes the whole campaign worthless.
The existence of tools like Grin has made it easier for marketers to measure influencer marketing ROI. You can use this tool to keep track of how your influencers’ content is performing.
Challenge #3 - Attracting and Engaging Influencers
59% of marketers feel that approaching and engaging influencers is another big challenge.
With the growing popularity of influencer marketing, influencers get many proposals from different brands. Not only are they busier, but their demand has also gone up as well. Which means that in order to get them to work for you, you’ll need to put in a lot of effort.
How to Calculate the Effectiveness of an Influencer Marketing Campaign
Now that you know the biggest challenges in influencer marketing, let’s discuss some of the best ways to calculate the effectiveness of an influencer marketing campaign.
The first stage of measuring influencer marketing effectiveness is measuring the awareness driven by your campaigns.
The metrics involved in this are:
You can calculate the number of followers you got during the period of your influencer marketing campaign.
One big question marketers have is: “How do I know whether the followers I got are from the campaign, and not from another source?”
To answer this question, you should start measuring the followers you are getting weeks before you begin the campaign.
Then you can compare the followers you got before the campaign and during the campaign. This process can be made easier by using monitoring tools that do all of the work for you.
Brands like Glossier have built their businesses from the ground up relying heavily on influencer marketing. They continue to work with micro-influencers like @oceanshades to grow their following.
Measure the impressions of the posts to calculate the visibility to your audience.
This helps you understand how many people saw the posts. The more impressions, the better it improves your brand awareness.
Apart from this, it gives you helpful data about the reach of your content with different influencers. This can also help you improve your influencer selection process in your future campaigns.
Transparency also comes into play here. The influencers you’re working with will have to be transparent about the metrics they share with you.
How many people visited your website after seeing the influencers’ posts? This important metric can further help you calculate the effectiveness of an influencer marketing campaign.
Google Analytics comes in handy in this situation. It can give insights into how many people visited your website, the traffic sources, and how much time they spent on your site.
Setting up URLs for your campaign makes this process a lot easier. This will help you filter out many unnecessary elements, and give you all of the important data from the campaign.
Measure Campaign Engagement
Campaign engagement is the next important metric that shows you how effective your influencer marketing campaign is.
The metrics that you should be measuring under campaign engagement are:
The amount of likes your posts get determines how people feel about your content. Likes also help create buzz, which can help the posts get more impressions and a larger reach.
To get more likes, your content really needs to be high quality and relevant to your audience. It’s important to understand here that, even though your post could get large number of impressions, it will not get a lot of likes if the content is not of high quality.
It all boils down to targeting the right audience, and creating content relevant to them.
Comments can also help you determine the effectiveness of your campaign. They shows you how people are interacting with your content.
Comments help you understand the views of your audience. These comments are important because they come from your potential customers.
If your post is being shared across different networks, it means that your campaign is doing well. You should track these shares, and understand what caused people to share your content.
Understanding shares will also help you in your future influencer marketing campaigns.
Having your influencers add calls-to-action that encourage their audiences to like, comment, or share your content is a good way to bring these numbers up. Here’s how Sephora does it with influencer Vivien Yeo.
Tracking conversions isn’t enough to measure the performance of your influencer marketing campaigns.
Setting up Goals in Google Analytics is very simple. There are many types of goals you can create in Google Analytics.
One type of goal that can be used in your influencer marketing campaigns is:
URL Destination Goals
When someone visits a particular page on your website, it triggers the goal. You can use these types of goals in your influencer marketing campaigns by creating a separate landing page for the campaign, and then tracking the visits using this goal.
You can also use these goals to track email sign-ups. If you have an opt-in page on your website, you can create a thank you page, and redirect all people who opted into that page.
This way you can also track conversions.
Track Brand Mentions
Lastly, you have to measure how well your campaign performed overall. This includes measuring the impact of the campaign on your audience.
This can be done by tracking brand mentions. Many marketers ignore this because brand mentions get out of hand, and it’s hard to track them.
But it is very important to invest in tracking brand mentions. You can do this by using a brand monitoring tool that tracks and notifies you whenever your brand name is mentioned.
Growth in Database
In case the aim of your influencer marketing campaign is to grow your email database, leveraging a tool like MailChimp can help. Such automation tools with inbuilt reporting capabilities will help you track, optimize, and enhance your efforts.
If the goal of your campaign is to increase downloads of your e-product, then keep track of the number of downloads. Here, too, you can use UTM tracking links to keep track of the number of downloads.
Now that you’re finished looking at the performance of your individual influencers, it’s time to figure out your ROI for each one. As important as it is to track your overall ROI for the campaign, you should also be monitoring individual ROIs.
Remember, that despite all of your KPIs, the most important of them will be the actual revenue generated by your influencers. Assuming, of course, that that is the primary goal of your campaign.
Say, for instance, you pay $100 for a single Instagram post about your product by your influencer. You’ve also given them a special discount code of 10% to help encourage their audience to make a purchase.
During the duration of the offer, 10 coupon codes were redeemed resulting in $1,500 worth of sales. Your percentage of returns will be calculated on the basis of the net $1,400 you’ve earned.
Now, to calculate your return percentage on the initial investment,
There you have it. Your influencer was able to deliver an ROI of 1400% for the period of the sale.
Once you know how, tracking the effectiveness of an influencer marketing campaign is simple. But to do it successfully, your campaign should be well-positioned. and have a clear goal.
If you track the above metrics, you can easily find out whether your campaign was successful or not. Measuring influencer marketing ROI will also give you insights about different influencers, and their audiences, which will help you plan future campaigns.
Do you track any other metrics to determine the success of your influencer marketing campaigns? Please share them, and any tips you may have in the comments section below.
Brian Mechem is COO and Co-Founder of Grin, a software solution for companies who run influencer marketing programs. Grin's software powers some of the best influencer programs in the world, providing insights on ROI and adding efficiency to the influencer marketing process.