The Pros and Cons of Working with Influencers

by Irene Maccabante

Influencer marketing is a confusing part of the marketing puzzle that can leave small spas and brands unsure how to proceed. How do you
know if working with influencers is right for you?

Who is an influencer?

It’s important to understand what an influencer is and how they use their following to market partnerships with brands to decide if this is the right route for you.

An influencer is a person with an online presence who has the potential and ability to influence the opinions, behaviors and even purchasing decisions of their sizeable audience of fans and followers.

There are three levels of influencers:

1. Mega-Influencers

These flat-out famous folks are actors, musicians, athletes, reality celebs or social media icons that
monetize their celebrity power. They usually have over one million followers across all their channels. They have extensive reach, but very low
engagement levels—between two percent and five percent. They are most commonly used for creating buzz and awareness, and fast.

2. Macro-Influencers

These are the bloggers, creators and journalists of the world. They typically have between 20,000 and 1 million followers and their engagement levels are between five and 25 percent higher than mega-influencers. They have a decent amount of celebrity but aren’t superstars. They may be easier to connect with, and because they’re content creators (social posts, blogs and videos), they tend to take on a more down-to-earth, conversational tone as well. These influencers have attracted the most attention from brands and have become the new celebrities for millennials.

3. Micro-Influencers

Micro-influencers are everyday consumers who have relevant influence. They are niche players and industry experts with followings in the range of 500 to 20,000. Brand ambassadors fall into this category as well. Followers of micro-influencers love to engage and they often do so at a rate of 25 percent and higher. Although they are the easiest to reach and connect with, they vet their sponsors carefully ecause their reputations depend on their credibility. They won’t endorse a low-quality product or anything that doesn’t align with their interests. You’ll know exactly what their interests are because they’ve listed them in their bios and frequently share content about them. Their fans follow them precisely because of those interests.

What is influencer marketing?

Basically, it’s today’s digital-age version of word-of-mouth referrals. Social influencer marketing focuses on key individuals rather than the target market. Campaigns are structured around a single person or multiple people who have a large following online and who have direct influence over their following.

Brands use influencer marketing to reach Gens X, Y and Z because these generations live online and trust influencers over traditional advertising. Most brands’ influencer campaigns involve one or a few of the following:

  • Sponsored social posts that include hashtags and the required Federal Trade Commission (FTC) paid partnership tag.
  • Experiential marketing, like free trips, experiences or products
  • Sponsored blog content or articles

The Pros to Working with Influencers

It’s all about the buzz and awareness, baby! Influencers can shift a brand from obscurity into the spotlight. By working with an influencer, brands can grow their following, engagement, and connection with a demographic that may have been previously out-of-reach.

Big brands work with influencers to shift brand perception, target new consumer groups, change the conversation and provide engaging content for their consumers. 89.6 percent of fashion, luxury and cosmetics professionals confirmed that the activities they carried out with influencers effectively generated brand awareness; 73 percent said that influencers were effective in building customer loyalty. So, there’s a trust factor to working with influencers— selling products and services to consumers is more effective when done by a trusted figure.

Fashion, beauty and luxury have also claimed boosted sales after sponsoring influencers—69 percent of that same group of professionals said influencer marketing was effective at driving sales. These brands use product gifting and sampling as their main tactic when engaging influencers—98.5 percent of these brands use this method because product launches are the leading scenario for which they implement influencer campaigns.

The travel, tourism and hospitality industries have been using this tactic with journalists for years. When it comes to travel, there’s nothing like a great photo or video to instantly draw in a potential guest. Influencers who post about experiences can have an immediate impact on brand awareness, purchase interest and, ultimately, sales.

Airbnb has used social media since its inception and claims that it has driven its success. Influencers are now a huge part of its social marketing and advertising strategy.

“Influencers are used in marketing generally to endorse and legitimize a brand,” Airbnb’s CMO Jonathan Mildenhall says. Airbnb’s latest major influencer campaign featured Lady Gaga and garnered over 500,000 likes and 4,000 comments. “The impact is phenomenal, because people are interested in the lifestyle of these influencers,” says Mildenhall.

Travel and hospitality brands and destination marketing organizations (DMOs) are jumping on the influencer bandwagon, particularly on Instagram: the Hawaii Tourism Board, Visit Dubai and Fairmont Hotels & Resorts, to name a few. Almost half of DMOs surveyed in a recent study by Skift Research report a very high or good ROI from working with influencers.

The Cons to Working with Influencers

While many big brands have had big wins, there have also been some epic fails over the past year. Influencer campaigns can easily go upside down if you’re not careful. From celebrities copying and pasting their instructions into their posts, to Kendall Jenner’s Pepsi controversy, to the discovery that many influencers are either buying followers and comments or have a huge percentage of fake followers, these fails illustrate how influencer marketing is the wild west of internet advertising. The FTC has put measures in place to ensure more transparency, but sometimes it’s difficult to properly scrutinize
influencers.

Influencers can also be a hard spend to justify for smaller brands. In one very viral incident in January of this year, a hotelier in Dublin named Paul Stenson banned all social media influencers from his hotel and adjoining café after a YouTube star asked for a free stay in exchange for promotion on her social media channels.

Stenson had a point to make: if he let influencers stay for free, who ultimately pays the bills for her stay? Who pays the hotel staff? Who pays for the utilities used during that stay? And, cheekily, he added, “Maybe I should tell my staff they will be featured in your video in lieu of receiving payment for work carried out while you’re in residence?” He also argued that it put the authenticity of an influencer into question if they said good things about something just because it was free.

It’s a point well-made for small brands who don’t have large marketing budgets. You may be able to take it on as a marketing expense if you’re a resort
spa, but for smaller establishments, it may cut into your hard costs and profit margins, and take money out of your employees’ pockets. If you’re constantly
comping influencers’ services and adjusting commissions and gratuities downward, you’re doing your staff a huge disservice.

It can be difficult to quantify the ROI for an influencer campaign for spa brands. It’s hard to tell exactly when the guest made the decision to visit your spa. Even with a trackable link or discount code, “to have an exact quantifiable amount in terms of how much revenue was produced from that one visit is extremely difficult,” says Halla Rafati, public relations director for the Four Seasons in Toronto.

Influencer marketing is a powerful tool, but it isn’t for everyone. If you want to grow or gain greater market share, you’ll have to get serious about your marketing spend, tracking its ROI and how effective it is in the long run for your spa.