85% of FMCG firms report a negative influencer experience, so what’s going wrong?

By Alec Harden-Henry, Commercial Director, Influence Network.

In the world of Fast Moving Consumer Goods (FMCG), influencers are big news.

A recent report highlighted that almost half of FMCG companies will allocate 50% of their marketing budget to influencers.

That statistic is a) astounding and b) would be largely unthinkable just a few years ago. 19% of the same companies described their budget plans for influencers as being ‘upped significantly’.

And yet many of those companies appear to be having the same level of issue with the influencers they work with as they did when influencer marketing first arrived as the new kid on the block.

A staggering 85% of the 917 companies surveyed reported a negative impact on their brand thanks to an association with an influencer. 24% had been negatively impacted more than once.

A land of risky opportunity?

The picture that these two statistics paint is of something we used to call ‘the influencer Wild West’. This is an extended metaphor, so bear with me…

The real life Wild West was a lawless frontier. You went ‘out there’ to chase your freedom and, sure, you could end up with a gold nugget the size of your fist during the gold rush, but you could also end with a fist the size of, well, a fist, hitting you in the face several times. Fortune was promised and sometimes gained, but often teeth were lost, because of a lack of societal structure and law and order.

American history lesson out of the way, hopefully the comparison makes sense: influencer marketing was the wild west and it was very easy to rush into and get your fingers burned (or teeth lost).

But, crucially, the points there are that we used to apply that label and that it was indeed the Wild West. Things have changed.

The ASA guidelines are clearer and brands and influencers now have more experience of each other’s expectations. So what’s actually going on here? Are we back in the frontier lands? It’s possible several of the below are actually true and the root source of what’s happening.

Brands are finding it difficult to scale

Ask any influencer marketing manager and they will tell you that doing influencer marketing at scale is tough.

Hire one influencer and you have one influencer to find, one agreement to come to, fee to agree, contract to sign, brief to give, work to check, performance to review and fee to pay.

Hire 125 micro influencers, each with 4,000 followers and you have the recipe for a really great campaign, potentially hitting more than half a million people. But you also have 125 influencers to find and their associated agreements, fees, contracts, briefs, checks, reviews and payments to handle. It’s too much for many brands to do effectively.

And so, there’s the potential here that that work simply isn’t getting done effectively. As brands pour money into influencer marketing the scale alone is creating issues with parts of the process, which leads to dissatisfaction and disagreement.

There’s structure, but still too much room for missed communication and dispute

We’ve recently seen the formation of two unions for influencers; one based in the UK and one in the US. The unions cite their concerns as being variable pay and demands, licencing liberties and discriminatory practices.

The root problem could be that each brand which engages directly with influencers does so in a different way. Prices are set and negotiated in different ways; different brands value different things.

There’s structure, but it’s not consistent structure and that leaves the opportunity for dispute and dissatisfaction. As we’ve seen with the way we work; when both ‘sides’ know the rules and the rules are consistent, everyone is happier.

In the ‘rush to market’, corners are being cut

This is similar to the first point and barely needs expanding. The fact is that, in some of that 85%, there will be examples of both brands and influencers who aren’t quite playing by the rules.

Some of this will be down to the increased activity in the marketplace. If brands ‘need’ to do influencer marketing, they could be engaging without background checks, with bad briefing and poor contractual communication. Influencers, flush with new opportunities, could be rushing production and skimping on detail. Again, the only real solution is consistent agreement on structure, timelines and acceptable quality.

The guidelines and structure of the influencer economy still have some way to go, in some quarters

The overall marketplace has adapted to the ASA’s influencer marketing guidelines well, but the fact that 85% of FMCG brands have had a negative experience suggests that there could be more guidelines on the way.

Better yet, as the sector heads to maturity, hopefully more firms will move towards consistent pricing models and potentially 3rd party-administered campaigns (whether that is via platforms, such as ourselves, agencies or another solution), which provide solutions for quality, consistency, scale and management.

The DIY approach to influencer marketing, given the two headline statistics, could find its days numbered.

Whatever the issue though, answers will be found, one way or another. As investment goes up the number of problems must come down, or brands will be forced to look elsewhere, despite the promised return of the sector.

No one wants that scenario, so the solutions will come and the Wild West, for better or worse, will be tamed.

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