Influential Mentions Aren’t the Same as Word Of Mouth Returns

The influencer marketing model may be worthless

Earlier this week, I took a look at why the social influencer – as identified by the likes of Klout, Kred, etc – isn’t anywhere near as valuable as an Instigator.

The post created a great discussion (which is still ongoing) around both sides of the coin, and whether it was just a case of semantics or if an Instigator was the true “influencer”.

I just wanted to expand on that a bit more, especially on why the influencer marketing model (as it currently stands) may be even more worthless (at least as far as real results go).

The Reach Effect

Looking at how Klout sells the “benefits” of its service, it attracts brands by selling them the golden ticket of putting their product or service in front of Klout’s army of influencers.

After all, the social web is built on who’s the most influential, right? The more followers, the more reach – the more reach, the more action. Eh – maybe not.

Reach is one of the most overrated metrics around. While saying “Reach 200,000 consumers” might sound great to a brand, it’s a bullshit metric. It’s assuming all 200,000 followers of a Twitter influencer, for example, are online at a given time, waiting to see that one awesome tweet about a product.

The other issue with reach is that it’s just a calculated number. Twitter user A only has 1,000 followers, but the combined number of all the followers that follow Twitter user A and their followers make up the “200,000 consumers” reach. And half of them might be bots.

So, reach is out of the question.

The Return on Perks

Once Klout (and others) have sold an ad campaign to brands, they turn that into Perks (or Rewards). This allows people with a certain score or above to apply to get free stuff – shower gel, cookies, or even a test drive in a new car.

A recent example is car manufacturer Chevrolet, who offered a loan of the newly-launched Sonic to 130 “influencers” with a Klout score of 45 and above. Looking at the results, you’d say it was a success:

• 16,000 positive mentions online
• Three discount requests
• One car sold

As a case in raising awareness, 16,000 mentions isn’t chump change. Or is it?

The cost of a Klout Perk starts at $25,000. Considering Perks can be shampoo giveaways, let’s assume the Chevrolet campaign cost more than $25k. You’ve then got to add gas costs for the loans. And insurance. And sales people’s time for both the test drives and then the follow-up calls. And the discounts offered.

And these are just the basic costs. So, for that one sale that brought around $14k into the Chevrolet coffers, there’s a major negative return sales-wise. And I don’t care what business you’re in, you can’t survive on goodwill mentions alone.

Now, it’s true that a car purchase isn’t an impulse buy – there’s a longer process involved, to compare models, showrooms, offers, and more. So it may be that we’ll see more returns on the Chevrolet campaign. Let’s just hope the 130 people involved actually like the Chevy brand and weren’t just along for the free ride.

The Return on Silence Versus Word of Mouth

Of course, this is all conjecture, since Klout are very quiet when it comes to reporting the financial successes of their Perks programs. Sure, they’ll bleat about having 700,000 Perks across 350 campaigns since launching two years ago, but how many of these resulted in real sales to the brands involved?

If I had 350 campaigns, and even if just 10% of them resulted in positive ROI for the companies involved, I’d be shouting that from the rooftops, to both attract more brands and silence the critics.

Klout’s own silence in this regard is deafening, and can be taken however you wish to view it.

Compare that to true word of mouth campaigns and researched demographics – where the idea of Instigators versus Influencers comes up – and it’s a different story.

Paramount and Super 8

When Paramount was getting ready to launch their big Steven Spielberg and J.J. Abrams collaboration, Super 8, they created a hashtag on Twitter for the event, #Super8Secret. This was to build buzz and awareness for the movie with secret early showings across the U.S.

The result?

• 9 million impressions in 24 hours (impressive, even for a flawed metric)
• 150 tweets per minute
• Over $1 million sales for sneak preview tickets
• Exceeded Paramount’s expectations for opening weekend sales by more than 50%

Unfortunately, I don’t have the cost of the campaign – but creating a hashtag on Twitter and then letting it run amok is probably less than the instant million dollars it created, never mind the opening weekend sales.

The reason the Paramount effort worked – and offered a profitable financial return as opposed to just mentions and a negative sale – is the audience was eager, targeted, and actual fans of the product (in this case, the joining of Spielberg and Abrams).

They took action from Paramount’s instigation instead of just tweeting about the deal. Compare that to the Klout Chevy Perk, and how that (so far) offered more reactions (loans for free) over actions (one purchase, negative return).

Look Beyond the Numbers

The comparisons and results between Chevy and Paramount shouldn’t come as surprise, though. Klout puts its partners in front of eyeballs based on their in-house metric, which has shown to be flawed time and time again.

Additionally, Klout creates the profiles on its site – you, as a number, don’t have a say in that unless you opt out. So the numbers they promote to their ad partners is skewed from the start.

A proper marketing campaign, on the other hand – media buy, ad buy, email campaign, social media – integrated and targeted will trump the influencer buzz every time (or pretty much every time).

Because smart marketers look beyond the numbers and look to how their effort contributes to the numbers that matter instead.

Which, at the end of the day, is what really matters, no?

There are 2 Comments. Add Yours.
  1. Priceless & dead on Danny!! Too many miss this including the big so called big SEO services that sell on numbers only. It astounds me every time I hear it… do they really think we’re than dumb and remained in business? haha

    “Because smart marketers look beyond the numbers and look to how their effort contributes to the numbers that matter instead.

    Which, at the end of the day, is what really matters, no?”

    “socially responsible twist” Perfect tag line.. and needed so bad!! Looking forward to more of your articles ; )

    • well put Gail and thanks Danny for the great post. As a web marketer I completely agree.

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