With 700 million Internet users and 190 million online shoppers, India is one of the largest online shopping markets in the world after the United States and China, as per market research firm Statista’s latest findings. Perhaps this is also a reason why India has seen the rise of Direct-to-customer (D2C) brands across categories. To say nothing of, these brands have risen to popularity on the back of short video platforms such as Instagram’s reels, YouTube shorts, among others, which are used by influencers. “D2C brands and influencers have a symbiotic relationship of interdependence. Going the influencer way or not and to what degree is a strategic call for the brands. Influencer usage upped with the rise of social media, which I believe has plateaued and is not the future,” Sanjeev Kotnala, brand and marketing consultant, Intradia World told BrandWagon Online.
The short-form video industry in India is expected to reach $5.5 billion in revenue by 2023, growing at a CAGR of 32% from 2019 to 2023, as per a recent RedSeer Consulting, report. Moreover, the average daily time spent per user on short-form video apps in India has increased to 32 minutes in 2020 from 21 minutes in 2018. Even as time spent on these apps have increased, industry analysts point out that perhaps top influencers have started to lose their sheen among D2C brands and hence there has been a change in strategy which has led to the brands hedge their bets. “Many D2C brands who have realised the uncertainty in returns from influencer spends, are now focusing on other marketing strategies as well as investing in producing engaging and authentic content that resonates with their target group. In fact, I see a rise in the number of micro-influencers with many D2C brands recognising their value, especially niche brands,” Pratheeb Ravi, executive creative director, Publicis Worldwide, said. It is believed that micro-influencers, with their smaller but highly engaged followers, are helping niche brands create trust amongst their customers, thereby driving brand loyalty. India is currently home to more than 600 D2C brands with a market size of approximately $55 billion in 2022, as per Statista.
Selection process
To be sure, the selection process of an influencer differs for each and every brand. An influencer is further selected on the fact at what life stage a brand is in. For example, in case of newly launched brands the reliance on popular influencers is more compared to a brand which is mid-life and has managed to gain some popularity. Next criteria placed is the fact that influencers are chosen based on quantitative metrics such as their reach, engagement, and budgets besides other qualitative markers such as the composition of their fan base and the nature of content. “When the brand and the influencer are both aligned on creating information and solutions for its followers or potential consumers, it’s a match made in heaven. The second thing to check for is the novelty of the content. Content should be unique, relevant, and entertaining for the follower, only then it is going to work. In addition to this, engagement metrics play a big role – engagement rate, comments, demographic of followers,” Romita Mazumdar, founder, Foxtale a D2C skincare brand, explained.
However, there are a few with a tad different school of thoughts who quickly point out that many brands also go for the trial and error approach. “If it’s a beauty brand, it looks at insights where the female following ratio should be more than males. Brands also look if the influencer uploads enough make up content and if it fits into their concept of promoting the products,” Aastha Shah, digital content creator with 6 lakh followers on Instagram, added. Not to mention, many times a city is also factored in if the aim is to promote a brand or service in a particular geography.
Dependency versus over-dependency
Typically it is a two-way street with influencers and brands being co-dependent on each other. While influencers need brands to earn a living and gain popularity in the process or vice-versa for D2C brands, influencers bring much needed traction onto their website and products. “In order to build credibility D2C brands are definitely more dependent on influencers to drive trust and trial amongst consumers plus in some categories drive product or service education as well. Especially since cost of production and media is not something all D2C brands can afford in their journeys,” Prachi Bali, EVP and business head, Saatchi & Saatchi Propagate said.
Influencers too, interestingly, opine that there are no greater in this case. However, in certain cases where a brand is focussed only on influencer marketing and thereby has refrained from using any other means of marketing, then the scenario changes. Similarly, if a creator only has collaboration and a means of earning money, then co-dependency can turn into over in no time. “It is something for which we cannot have a straight answer as it will be on a case to case basis,” Himani Chowdhary, finfluencer with 6.7 lakh followers on Instagram, opined.
What lies ahead…..
Experts believe in order to build a brand, companies need to have an agile plan as opposed to being dependent on one mode of communication, advocacy through just influencers. One of the ways it is believed brands can connect with influencers and their followers, by investing in retainer models or other methods of repeat compensation without dictating on content or formats. “As long as both champion similar principles and are aligned on creating honest, valuable content for consumers it’s a fruitful collaboration and leaves enough room for experimentation for the influencer as well,” Mazumdar of Foxtale, explained.
It is believed that despite all the challenges currently being faced the bond between influencers and brands are expected to become stronger. This is largely due to the fact that at one point this will be a co-dependent relationship as opposed to over-dependent. “Retainership gains significance as brands maintain loyalty to their core influencers while experimenting with new faces. The allure of influencer marketing lies in its dynamic nature, continually reshaping the marketing landscape, leaving neither D2C brands nor influencers behind,” Krishna Iyer, director of marketing, MullenLowe Lintas Group said.
Yet, naysayers point out that with influencers turning into entrepreneurs now, this equation may also evolve. Some of the famous influencers who have become entrepreneurs include Deeksha Khurana’s Deeeclothing, The Snob Shop by Aashna Shroff, Simran Bhatia’s Swishboss, Damera by Cherry Jain, among others.