Casual purchase categories, including beauty, cosmetics, fashion, lifestyle, smartphones and often even other electronics, are among the top categories that make use of the nano-influencers.
By Venkata Susmita Biswas
Trust deficit on content shared via social media has resulted in brands roping in a new breed of influencers — nano influencers — to promote their products and services. These social media influencers typically have a following of less than 3,000 users, most of them known to the nano-influencer. Casual purchase categories, including beauty, cosmetics, fashion, lifestyle, smartphones and often even other electronics, are among the top categories that make use of the nano-influencers.
As per a report by advertising network IPG, there has been a consistent decline in the number of purchases made based on social media recommendations worldwide. Therefore, experts believe that the recommendations, reviews, and comments of nano-influencers could be more valuable and genuine in the eyes of consumers as opposed to roping in celebrity influencers.
Apaksh Gupta, founder and CEO, One Impression, an influencer marketing agency, points out that while mega influencers and celebrities have a vast reach through their social media followers that run into millions, it is smaller influencers who elicit trust from their followers. “We all have that one friend who tracks the latest developments in the smartphone space, or someone who will give you the right advice on which car to buy. These are nano-influencers,” explains Pranay Swarup, CEO, Chtrbox, an influencer marketing agency.
Consider how Xiaomi, a brand that did not pump in a lot of money behind traditional advertising, has used the strength of its fan community to reach consumers. It identified some consumers who were highly involved with the brand and its products and turned them into advocates for the brand. Anuj Sharma, CMO, Xiaomi India, says the brand relies heavily on word of mouth marketing and considers it the best form of marketing.
“When we launched Mi 3 in India, we looked at our Facebook page and discovered that we had 10,000 followers. On the basis of that we decided to bring 10,000 units of Mi 3 in our first flash sale on Flipkart. We sold 10,000 units on the first sale within seconds and Flipkart crashed for the first time as over half a million people came to purchase the device,” he recollects.
Sharma attributes the company’s shipping of 100 million smartphones in India over the last five years to this word-of-mouth strategy that the brand has followed in the country.
Other examples include Livon, the hair care brand from Marico, which executed an influencer marketing campaign earlier this year which involved several nano-influencers. Then there’s Max Fashion, which runs a college ambassador programme that seeks the support of 150 student ambassadors who popularise the latest trends from Max on their college campus.
“The purpose of using nano-influencers like students over celebrities is that of creating varied social media content. A celebrity’s post that is promoted on social media earns lower engagement than that of several posts by people with fewer followers,” points out Jiten Mahendra, VP Marketing, Max Fashion.
Gupta defines the content strategy of nano-influencers as that of diversifying reach by decentralising content. He says that not only does engaging nano-influencers make sense from a Search Engine Optimisation (SEO) perspective, but it also ends up flooding social media with thousands of posts on behalf of the brand.
“Nano-influencers are also cost-effective,” Swarup notes. Mega influencers charge between `1-5 lakh per post while nano-influencers charge up to `2,000 per post but most often end up in deals where they accept samples or products from the brand. “At the moment brands are setting aside around 30-40% of their influencer marketing budgets for nano-influencers,” Gupta says.
Even as marketers are willing to increase their influencer marketing budgets, assigning return on investment to influencer marketing is hard. Pragati Basu, marketing manager, Talkwalker India, explains, “This is because there aren’t many tools to calculate direct ROI; but it is not impossible. Yet people aren’t as interested in the measurement of ROI as much as brand awareness. There is always a lot of buzz after an influencer marketing campaign and people are happy to invest more based on the buzz whether or not it brings direct ROI.”
“We calculate ROI by assuming the cost of a certain activity, cost of acquisition, and compare that to the actual investment into influencer marketing,” Swarup explains. ROI on influencer marketing is studied on the basis of comparison to the amount of investment a brand would have had to make on other media to achieve the same reach as through influencer marketing. Some reports on the basis of this kind of calculation have shown that influencer marketing delivers five times more ROI than paid marketing campaigns.