Labcast: Digging Deep into Influencer Marketing
In our latest episode of Labcast, Nick Hayes, principal at Influencer50, calls in to chat about some of the fundamentals of influencer marketing and how B2B companies can leverage online influence to raise brand awareness and gain new customers.
For additional insight from Nick and more tips for developing your influencer marketing strategy, be sure to download our free eBook, The Value of Influence: The Ultimate Guide to Influencer Marketing.
Brendan Cournoyer: Hello again, everyone, and welcome to this episode of Labcast. I’m Brendan Cournoyer, and today we’re joined by Nick Hayes, principal at Influencer50, a leading influencer identification and engagement firm. He is also the author of the book, “Influencer Marketing. Who Really Influences Your Customers?” and he was kind enough to write the forward for our latest e-book, “The Ultimate Guide to Influencer Marketing.” Nick, how are you doing today?
Nick Hayes: Hi. I’m good, thanks Brendan.
Brendan: Well, thanks very much for joining us. Like I mentioned, we have a new e-book out, “The Ultimate Guide to Influencer Marketing,” that you contributed to. So we thought this would be a great time to have a conversation about the power and value of influencer marketing for early and expansion stage companies. I guess a good place to start is right at the beginning. What is influencer marketing? How do you define it to people who are unfamiliar with what you do?
Nick: Influencer marketing, the way that we see it, is we really base the idea on the fact that most marketing departments are in our view pretty much set to be 20 years behind what the market is. So if you think back 20 years ago, a vendor company, whether they were start-up, mid-stage or an existing large company, they would be using PR to find as much media company that they could, they’d be going to industry analysts probably, and that’s fine if industry analysts and journalists were the most important influences in their marketplace.
Twenty years ago, they very much were. We based our company on the understanding that in the past 10 years the influences have very much segmented themselves so that there are, according to us, 25 different categories of influencer and many of those previously won’t have been worked with or targeted or engaged with by client firms. Our view of influence on marketing is that we try to understand who are the real influences behind purchasing decisions and not just the well-known names, the major journalists that most marketing departments still believe to be the case.
Brendan: You said in the forward influencer marketing is something that a lot of business folks, when you explain it to them, they intuitively get right off the bat, but still there’s a lot of companies that aren’t really doing it in the way that you’re describing here. Why do you think that is? Do you think it’s just a slow climb to change your thinking being like we don’t just have to target these PR and journalism people, there’s this whole new set of influences that the Internet has created for us to target?
Nick: That’s a good question, but there are a few things that I think has confused the market. The most recent one that is confused is that there are a number of social media companies who talk about themselves being online influence measurement and what they’re really doing is analyzing future maps of social media data, largely based on Twitter, to what they believe is to try to understand who are the most influential people.
We very much disagree with that because we think that’s a way of measuring noise. It has very little correlation to do with influence. You asked just now what our understanding of influence to marketing is. Our understanding of an influencer is someone or a group who have an effect on the buying decision. That’s very different from individuals who just decide they want to shout a lot, they want to make a lot of noise, but there’s no measurement as to whether anybody is actually listening and putting those views into practice.
Our view of influence in marketing is that it’s based on the effect. Influence is an effect, it’s not an action. That’s one thing we think has confused the market is that people suddenly believe that maybe analyzing Twitter data is a way to short cut their search for influences. Every time we try to measure the effect of most social media, but certainly Twitter on B2B decisions, we can’t find any correlation between social media activity and the effect it has on B2B decisions.
So we think that the vast majority of B2B purchasing is still based on offline conversations rather than online. One thing that has confused the market is the fact that some people are saying you can now look at this market solely through social media data and we certainly don’t believe that.
The second thing that I think has traditionally confused the market is that for the past 10 years every PR company in the world has had a slide called influencing the influencers and every time we see those slides it’s effectively a slide that goes after journalists, perhaps industry analysts and a few other people. The problem is when you’re working in influencer marketing, when you look at it through a PR company’s eyes you really want as many of those influences to be as journalist as possible because that’s your bread and butter business.
There is also a very established charge of PR companies who are saying the influences are really journalists plus a few others and we look after those, and from our point of view, when we look at markets for our clients, we can rarely find journalists or industry analysts that collectively are more than 30% or 40% of the influences in any particular sector. So there’s 60% who are non-journalist or non-analyst.
Because they can’t be grouped into any major category, there’s not one category that is always 30% or 40% or 50% of the influences, they’re very fragmented. It’s a much harder market to understand. It’s a much harder market to target. So that’s the reason for the confusion is people just think it looks too hard to understand the real influences, we’ll just go for the people we accept as being important in the market.
Brendan: Sure. And you mentioned briefly there the difference in influencer marketing for B2B companies and the majority of our audience are B2Bs so said how Twitter and a lot of the social media platforms aren’t really effective in terms of finding influencers that actually influences the buying decision for B2B companies, so if you are a B2B company and you’re interested in influencer marketing, where do you start? What are some of the first steps that you take to get on that path?
Nick: The number one thing that any company, whatever stage of evolution it is, the number one thing that any company needs to do is understand the buying process for your particular brand or service. There really isn’t one size fits all. It’s easy to say well you go out and identify the influences, but you don’t know the influences unless you know the target market that you’re aiming at.
You really have to understand how that target market makes its buying decisions. There are several evolutions that happened over the past decade. The reason that B2C is different is that largely B2C are far more likely to be individual purchasing decisions. So whether it’s where you’re going to go on vacation, whether it’s what car you’re going to buy, you’ll talk to individuals to get a sounding post on what decision you’re going to make.
Realistically, it comes down to one person’s decision, most of those B2C decisions, that’s very different in B2B. Around 2000 in terms of B2B there was kind of the rockstar CIO moment when there were certain individuals in corporations who harvested a lot of individual power to make decisions on their own.
Then obviously when the Arthur Anderson and the corporate governments and the Enron scandals and whatever, as soon as corporate governments came in and Sarbanes-Oxley and whatever, there was so much need for accountability that the era of single-person decision making really fell by the wayside. Everything now is so much more committee-based, team-based. There are very few B2B decisions of any great stature that don’t involve 5 or 10 individuals.
With that, it means that there is a much more desperate set of influences because obviously all of those various decision-makers have their own set of influences. The decisions are much more drawn out and there’s much more opportunity for vendors to lose their way because they might have a product champion who’s champion the purchase of their goods and they lose the way because of internal politics.
The role of the influencer in B2B decisions have been exponentially on the rise as the growth in committee-based decisions has happened throughout the 2000s.
Brendan: Well, that’s interesting stuff. Another thing I wanted to ask you about was, as a B2B company when you’re involved in this process, a lot of people will tell you that the ultimate goal of influencer marketing is really to become an influencer yourself. Ultimately, through these practices become influential to your potential customer’s buying decisions through some of the content you create and the messages you put out. Is that something that you guys abide by or adhere to when you’re talking with companies and helping them map out their influencer marketing strategies?
Nick: It’s funny you say that. Sometimes the answer is absolutely yes, but the actual fact is that when we work with our various client companies to understand the influences in their marketplace, we have to analyze the entire market and very often there will be competitors who are influential within their marketplace.
If you’re company A, you don’t want to hear that company B has three of the most influential individuals in your marketplace and they all belong to competitors, so absolutely one of the issues that our clients face is if they find that there are many more competitor influences than there are home grown ones.
So yes, there is a keenness for our clients, if they’re not well represented among the major influences, to become so. It actually brings me on to a second issue, which is that as much as our client companies all want to become influences as you suggested, many of the actual influences in a business marketplace either don’t know that they’re influences or they would prefer not to be known as being influential by anybody else.
It’s very different. If you’re a journalist or a media personality or something, part of your raison d’etre is to become as well known as you can and to be seen as amassing as much kudos and as much power and as much weight in the industry as you can. But actually many of the behind-the-scene influences that we identify it’s not in their either interest, it’s not in their personal nature and certainly their employers may well be against the fact that, or the idea, that those influences become well known and understood to be influential, partly because they don’t want to be poached by other companies and that’s a big factor.
There are certainly some employers who don’t want their individuals to be known by name out in the market because they think they’ll simply be taken out of their employment. Also, some influences believe that their influence is because they operate under the radar. They believe that if everyone now knows that they’re a major influencer they’ll be targeted by nonstop marketing campaigns and whatever, and they’ll lose their ability to be as influential as they were to start with. It’s not always in the influencers interest to be identified.
Brendan: That’s really interesting. I think this is going to be fascinating to a lot of the folks who are interested hopefully in our e-book, but just getting involved in influencer marketing in general. We’re just about out of time, but before we’re done I just wanted to give you an opportunity to tell us a little bit more about Influencer50, the work you guys do and where people can go to find more information. They can go to influencer50.com, is that right?
Nick: Sure. That’s an ideal starting place. We’ve also got an industry kind of magazine-style blog at influencermarketingreview.com, which is for individuals who wanted to catch up on the industry and start to understand the industry rather than necessarily our company, they can go to that address. But in terms of just giving you an overview of the company itself, the differentiation I believe that we have since we started seven or eight years ago is that we identify influences who operate both offline and online.
Brendan: Very cool. Well, Nick, thanks once again for taking the time and hopefully we can do this again sometime soon.
Nick: Thanks Brendan.