Influencer marketing has quickly become a gateway way for small businesses to build authenticity and trust around their brands (in other words, gain customers). 65% of influencer marketing budgets will increase in 2020. Yet 84% of marketers admit that they struggle to prove the return on investment (ROI) of influencer marketing.
You can measure your ROI with influencer marketing by clearly defining your objective and tracking your tailored key performance indicators (KPIs).
Instead of blindly investing in influencer marketing, choose one of the three objectives below to properly measure the ROI of your efforts. We’re taking the guesswork out of influencer marketing!
1) Brand Awareness
Brand awareness is how familiar people are with your business or product. Although not every person who hears about your company will buy from it, the pool of people who know about your company must continue to grow. Building brand awareness is particularly important for new brands or established brands introducing new product lines, but big names inarguably benefit from their notoriety.
Brand Awareness KPIs:
Website traffic: To track brand awareness with your website, use tools like Google Analytics to monitor traffic. By digging into this data, you will be able to track which visitors came from an influencer’s advertisement. This is possible through either building custom links your influencer will promote or by looking at the source of your traffic – If the traffic comes from the influencer’s website or socials, then that was the impact of the influencer’s reach.
Social media: Impressions, reach, and follower growth are all valuable KPIs on social media platforms when it comes to brand awareness. You can track this data in-app on channels like Instagram if you declare yourself a business. Otherwise, look into social media automation tools like AgoraPulse that can pull this information together for you.
Learn More: Why should I use social media automation tools?
2) Audience Engagement
Audience engagement is all about connecting with your potential customers – They already know of your business but don’t have a relationship with it. Engagement changes all of that by building a connection with your audience.
Audience Engagement KPIs:
Engagement per post: Social media is the best place to spark audience engagement. Take a look at your posts’ likes, comments, and shares for a measure of your average engagement rate. The best way to calculate your engagement rate is by adding up likes, comments, and shares, divide by your followers and then multiply by 100 for a percentage.
For example, if you have 700 followers and your post has 100 likes, 5 comments, and 2 shares:
- 100 + 5 + 2 = 107
- 107/700 = 0.1528
- 0.1528 x 100 = 15.28% (which is really good).
Use this metric to consistently track the engagement of your posts. This will come in useful once you launch an influencer marketing campaign and want to see the impact of their endorsement. Upload a product-related post around the same time the influencer posts their ad. If engagement picks up within 24 hours after an influencer promotes your company or product, then that was influencer marketing at work!
Average engagement rate: Find the average of the results from your engagement per post metrics. This can give you a better scope of your progress if you compare it month to month.
KPIs within this goal can vary depending on the company or campaign, but ultimately you’re striving to get a consumer’s commitment. This might include actionable items such as newsletter subscribers, downloads, or purchases.
We can’t tell you what specific KPI to track here because it should be customized depending on your company, product, and specific campaign. What we can tell you is how you can properly measure the impact of an influencer on this KPI.
Ways To Measure Varying KPIs:
- Create a promo code specific to each influencer you work with. This is a very effective way to track the engagement of an influencer’s followers because it incentivizes their followers to go through their offers. By tracking the popularity of each promo code, you will be able to see which influencers are performing better than others as well as how many sales influencer marketing sparked.
- Build a landing page for the influencer. Using web analytics–like Google Analytics–you can record the number of views a landing page specifically built for an influencer received. Do not promote this landing page anywhere else other than through your influencer. This tactic can be more time consuming at first but will allow you to see the amount of interest sparked by the influencer, rather than just sales.
- Launch an isolated influencer campaign. While similar to building a landing page, this approach will allow you to track an influencer’s impact on a sale throughout the entire marketing funnel. A common example of an isolated campaign is a brand collaboration that features a limited product that involves your influencer. Promote this product only through the associated influencer and track the consumer experience.
While pursuing any of these three KPIs, the most important things to remember are analysis and consistency. It is important to keep an eye on your campaigns so that you can measure their effectiveness and tweak future strategies. It is also important to consider that there are going to be people who are reached by your influencer campaign, but may engage/purchase later than you anticipated. Just remember, influencer marketing may be used to hit short term goals, but it will also have long term benefits.