The Smart Way to Measure Influencer Marketing ROI
When it comes to influencer marketing ROI (return on investment), we know a thing or two. For nearly 10 years, we’ve been working with brands on their influencer marketing campaigns.
Here’s what we know to be true.
- There is no “one size fits all” when it comes to calculating ROI. The impact of influencer marketing is dependent on your goals and the stage of your business.
- Traditionally, marketers think that ROI is solely defined by short-term, immediate sales. Other brands measure the ambiguous “brand awareness” metric without being clear on what that actually means for long-term ROI. While we encourage our clients to have a primary key performance indicator (KPI), limiting your campaign goals doesn’t allow you to understand the full-funnel impact of your influencer marketing program.
To extrapolate true influencer marketing ROI, brands need to understand how to shape their influencer marketing strategy based on short-term and long-term campaign goals and how they can work together. In this article, we lay out the metrics you need to track in order to effectively measure influencer marketing ROI.
4 Ways to Measure Influencer Marketing ROI
1. Brand Awareness
Brand awareness is a measure of how familiar your target audience is with your brand and how well they recall it after it’s been prompted. For example, if you were asked to name a skincare brand, what would be top of mind? We’re willing to bet Neutrogena, Olay, or Glossier would account for the majority of the answers. This is because the companies have excellent brand visibility.
Neutrogena has many brand partners, like @mallylately, that help it achieve this status of brand awareness.
It’s important to note that you also don’t have to be a household name to focus on brand awareness. You could be a smaller, more niche brand that wants to focus on awareness within a specific target audience. For instance, when you think of the best sustainable skincare brand – what comes to mind? It might be Bluem, an Aussie skincare brand started by sustainable lifestyle creator, Montana Lower, or HERBIVORE, the vegan skincare brand based in Seattle.
Your return on investment on a brand awareness campaign is the number of new potential customers who become aware of your brand or product through the campaign you’re running. This can be tracked with metrics like reach and impressions on posts, as well as follower growth and organic website traffic on your owned channels.
Brand awareness should be a primary KPI for:
- Brands entering a new market
- Smaller brands in crowded markets
- High-consideration purchase brands (i.e., diamond companies or furniture)
- Brands with long or time-based sales cycles (i.e., pregnancy products or cold & flu remedies)
If your brand does not fit into these categories, what you may actually need to focus on is brand engagement and affinity.
Brand awareness metrics to evaluate:
- Impressions – the number of times social media users have been shown your content
- Reach – the number of unique people who have seen your content
- Branded search volume – the number of people who are searching for your brand’s name
- Social media mentions – the number of people who are directly mentioning your brand on a social media platform
- Traffic – the number of people overall who visit your website and how many visit from a social media influencer’s post
2. Brand Engagement
While it’s important for your target market to know your brand exists, you also want to inspire some kind of engagement from them too. The people who engage with you today are the people who will buy from you tomorrow.
Your return on investment for a brand engagement campaign is the number of people who take action with your brand on social media platforms or on your site. This can be measured on a cost-per-engagement model with metrics such as likes, comments, retweets, post saves, clicks, and add-to-carts.
For example, Glossier partnered with @laravioletta to boost its engagement and received nearly 20k likes and 70 comments on its Instagram post.
Again, you don’t need to be a huge brand like Glossier to use brand engagement as a long-term growth indicator. The Bouqs Company measured likes and new followers as an indicator of long-term sales.
Brand engagement is the hero metric for long-term ROI, as it will help you forecast growth over time. Engagement metrics, such as comments and saves, are a strong indicator of brand love and can show purchase intent from existing and new customers. If you’re seeing high engagement, there’s a chance that it could translate into sales down the road.
Increasing engagement and affinity is crucial for:
- All brands! This is a necessary goal for long-term growth.
- Brands looking to redefine their image or launch a new product — engagement is a good measure of how people respond to your new approach.
Brand engagement metrics to evaluate:
- Engagement on social posts – the number of likes, shares, comments, etc.
- Social post saves – the number of people who save your posts to access later
- CPE – cost per engagement
- Email subscriber count – growth of your email list
- Follower growth on social channels
- Add-to-cart – the number of people who add a product to their cart
It’s important to note that you’re not just looking at the engagement on your influencers’ posts. Monitor how their engagement impacts engagement rates on your own channels — not just your social channels but your website as well. A successful influencer marketing campaign will yield engagement everywhere: TikTok, Instagram, and even LinkedIn. You want to see people talking about your brand anywhere sales happen.
3. Immediate Sales
At the end of the day, every marketer’s goal is to drive sales. When it comes to sales, ROI covers all purchases that can be directly attributed back to influencer marketing. Most often, brands use promo codes, analytics, and tracking links like UTM or Bitly to drive sales through influencer marketing.
All of your efforts will contribute to sales in some way. This includes long-term sales as a result of brand-building initiatives, as well as short-term, direct sales tracked through unique links and promo codes.
Of course, every brand wants to track sales — but we recommend that brands really consider whether sales should be the main objective to measure ROI. Certain brands are better positioned to drive direct, trackable sales through influencers:
- Brands with a lower purchase point
- Ecommerce brands with a short customer journey (i.e., fashion brands, makeup, etc.)
- Brands that are established on social media and have social media storefronts
- Brands that have already achieved awareness and affinity with their target audience
- Brands that can offer exclusive discounts through influencers that are not available elsewhere
Direct sales metrics to evaluate:
- Unique links: A specific, trackable link so that you can attribute where visits originate using Google Analytics and other tracking software
- Promo codes: A distinctive discount code, usually personalized to an influencer
Some brands will track sales using an influencer marketing platform. You can connect your Shopify store to a platform, like Aspire, to set campaigns and monitor their performance.
In addition, savvy brands are boosting sales through influencer whitelisting. This is when an influencer grants a brand partner advertising permissions on their social media accounts. This allows brands to use the influencer’s handle for their ads. By using whitelisting, social teams can put money behind influencer content and seamlessly turn them into paid social ads. Whitelisted ads can also be fully tracked and measured, from impressions and clicks to conversions.
4. Influencer-Generated Content
Influencer-generated content (IGC) is an essential yet often forgotten way of measuring the ROI of influencer marketing. IGC refers to the images, videos, and other creative assets that influencers develop, usually in partnership with a brand.
Note: You can also get user-generated content from brand fans. If you notice a creator making content about your brand, make sure to promote it, as Glossier did.
IGC can have an impact on your entire marketing funnel and is an incredibly powerful added bonus on top of the ROI you see from visibility, engagement, and sales.
There are several benefits to influencer-generated content:
- Influencer content is extremely high-performing. In fact, 60% of marketers reported better performance with influencer content as compared to their own brand content. Additionally, nearly 90% said, “the ROI achieved from influencer marketing is comparable or superior to other marketing channels.”
- By repurposing influencer content across various channels — including emails, paid ads, website, out-of-home activations, or your branded social media channels — you can support every single stage of the funnel with eye-catching, high-quality content. And it costs you less money. In fact, over the last year, brands cut 52% from their content creation spend by repurposing influencer content on their marketing channels.
- Negotiating rights to an influencer’s content is drastically more cost-effective and less time-consuming than a full-blown professional studio shoot.
Neutrogena does a fantastic job of repurposing its IGC.
So, how do you calculate content ROI for influencer content?
First, you can focus on the money you’ve saved on content production. This takes into account the money you would have spent on creating the actual content: filming, photography, writing, designing, licensing, etc. Then you can simply compare the ROI from your influencer campaign to past ROI on traditional campaigns. Measure this by pulling the cost from a previous photoshoot. Now add the cost from the design and ad placement. Compare that to the cost of the influencer’s content and ad placement.
How can you track the impact content has on your business? Look at the following data points:
- Total media value
- Content performance across channels
- Costs saved by generating content through influencers
- Time saved by generating content through influencers
Start Measuring Influencer Marketing ROI Like a Pro
Ultimately, influencer marketing can support a wide range of a brand’s key objectives. By understanding the full impact of these programs and setting realistic goals, you will clearly understand how influencers skyrocket business growth.
Before launching an influencer campaign, define your objectives. Focus on the stage of your business, the price of your product, and the sales cycle you follow. Then, track both the quantitative KPIs (i.e., number of likes, sales, etc.) as well as the qualitative data (i.e., comment sentiment, follower authenticity, etc.) to extrapolate the true value of your influencer programs.
If you’d like help tracking campaign success and analyzing your ROI, consider a platform designed for influencer marketing success. Let us show you how an influencer marketing platform can help you understand influencer marketing ROI better by checking out Aspire’s resources today.