How to Measure the Efficiency of Influencers in E-Commerce
How to Measure the Efficiency of Influencers in E-Commerce
If you are in e-Commerce, it is worth investing in Influencer Marketing. Why? Because your consumers have more confidence in what other consumers recommend than in what online stores promote about their products and services. It’s a fact!
The testimonies of others are perceived as a guarantee of quality: “Others have tested, and then I can buy myself.”
Whether it’s a tip from a friend or blog posts, Instagram content, ratings and reviews, TikTok videos, images on Pinterest or any other social network, what others (people like us) say can bring us closer to the decision to purchase.
We have been for years in a world where the power of influencers is a certainty.
It is also easy to imagine the case we would like to buy a product and, searching the Internet, not find any information about it other than the seller’s website. Would we trust him? Definitely not. We buy our gadgets, appliances, cosmetics, cars and dozens of other product categories only after we have learned from at least one person that they are good/reliable/quality.
Marketers use this power by finding touchpoints in the customer journey and spreading information to persuade them to choose a particular Brand, Product or Service: Blog posts that a customer can find when searching the Internet, collaborations with Influencers who talk about that brand and put tags until it becomes top-of-mind, contests that urge you to leave your contact details to receive news and discount codes, but also convincing photos and video tutorials on the site. The possibilities are many.
But the question the entrepreneurs or marketers ask themselves is how they measure the impact and results of the e-commerce influencer marketing campaign.
Customers would like to know precisely the impact of influencers, as a clear mathematical formula such as “speed = distance/time”. They want to know exactly how much they will earn from their investment in the campaign.
So how do we calculate ROI (Return on Investment) in E-Commerce?
But how do we calculate this gain in Influencer Marketing? There are several methods available.
In the short term, it is calculated using sales KPIs.
In the medium and long term, ROI is calculated using the following tactics:
When influencers make a YouTube video or Instagram Stories series, they can use an e-Commerce tracking code.
This allows the agency to track Clicks and Conversions arising from the Influencer’s content in e-Commerce. It is worth continuing and deepening our collaboration with Influencers who produce many clicks and conversions, as they have shown they have the ability to influence Consumers’ purchasing decisions.
In other words, the ROI calculation would involve a calculation formula that considers:
• Number of clicks
• Number of orders
• Profit margin
• The cost of the campaign.
2. Discount Codes / Vouchers
A very popular way is to use the various e-Commerce Discount Codes that an Influencer offers to his followers along with the Customer.
For example, with the promotional code INFLUENCER10, followers receive a 10% discount on total shopping carts.
A coupon code is a good option for Instagram Podcasts or Posts where a link can’t be embedded.
However, it is important to remember that each Social Media Channel has its own characteristics and to adapt specific tactics for the best results.
3. Tracking Pixel / UTM Links
It would be simple for the above to be enough, but the reality is that the user often does not always decide to make a purchase immediately, and this can happen later. Therefore, it is important to say that a simple Click or Conversion in a Promotional Code does not tell the whole truth about the Influence on Consumers’ Buying Behaviour.
According to a survey conducted in Sweden, quoted by Troot & OMD in 2019, only 7% said they clicked because they want to buy the product, while 52% said they want more information about the product.
An effective way to track results is to integrate the Influencer’s YouTube video with Google Ads and Analytics into the customer’s e-Commerce Analytics. Thus, ways to buy from content to customer data points can be built.
It is also worth mentioning that an Online Store should note that amplifying the voice of an Influencer with an investment in Social Media Ads can significantly improve the return on investment for Influencer Marketing. Thus, you increase the number of followers, get out of his bubble and offer the possibility to a wider audience to find out about his experience.
In the longer term, we are discussing the measurement of other indicators. Another way to calculate ROI is to calculate the costs saved.
4. Decreasing the Average Cost
An Influencer Marketing campaign can successfully replace a Paid Media Campaign nowadays when Social Media consumption is very high in almost all demographic categories (in Romania, penetration is lower in people over 60 years old, but there are fast increases).
In addition, in Influencer Marketing you can target messages much better than in Traditional Media, the communities of each Influencer are groups with more common interests than the readers of a Magazine or the Viewers of a TV Program. So, giving up a Paid Media Campaign decreases the costs used in this respect.
A look at the past years can show that, instead of investing 50,000 in Traditional Media, you can invest 10,000 Euros in Influencer Marketing and get similar results. Sounds good, isn’t it?
5. Decreasing Content Production Costs
What if you asked Influencers by contract to use the Company’s Social Media Content they used? Or if you really pay for a takeover on Facebook or Instagram? The costs of producing this content must be deducted from the investment. There are other ways to assess the result of the investment, although it may be more difficult to translate into mathematics.
6. Store / E-Commerce Interaction
You can consider the time spent on the site and the ratio of returning versus new visitors (visitors returning to the site compared to new visitors) and it can be correlated with the Influencer Marketing Campaign. It is possible that over time you will notice an increase in users returning to the site, their visits most likely eventually ending with a purchase. This is considered when calculating the ROI, even if the results are not immediate.
7. Measuring Brand Awareness / Customer Loyalty
More difficult to quantify is how users’ buying intentions have changed. Difficult, but not impossible.
You can use online surveys, even with discounts at the end of the completion to encourage the click rate, but also following the reviews (recommendations) is a good indicator.
In addition, a loyal customer can receive Discount Codes for his friends, to have an extra reason to talk about your brand. Any marketer knows that a very satisfied customer will become an Ambassador of the brand, sincerely recommending it to those close to the brand.