Influencer Advertising: The Benefits & Challenges

By
Tony Tran
In
Guide
October 8, 2019

Chances are you’re reading this because you’re about to incorporate influencer advertising (also known as whitelisting, these two terms will be referred to interchangeably) into your marketing strategy. Alternatively you may be ramping up and working with instagram influencers, bloggers, and social media influencers to gain advertising access is proving to be challenging.

If you’re already familiar with why influencer advertising is advantageous for brands, here is our article on how to do whitelisting in a more cost-effective, compliant, and scalable way. If you want a more comprehensive look at the pros and cons of whitelisting for influencers and brands, read on!

The Power of Influencer Advertising

Influencer advertising via whitelisting allows brands to combine the best practices of paid social media with the authentic and scalable content created by social influencers. When done right, whitelisting is fully integrated with a brand’s existing advertising tools and ad accounts, allowing for full control and visibility over ad spend and optimization of your influencer's instagram posts.

Why does influencer advertising complement and often outperform brand social ads? As best practices of paid social become more widely known, and Facebook Ads Manager continues to grow more advanced, the things that drive results are having the right creative and reaching your target audience. Gone are the days of quick “growth hacks”, hashtag stuffing and taking advantage of quirks in the Facebook algorithm. The brands that are poised to succeed in today’s digital landscape have unique brand stories and can tap into influential voices to tell that story at scale to different target audiences

While influencers have been shown to have tremendous sway with consumers, traditional influencer marketing across social media platforms is limited by scale, targeting, and measurability. Influencer whitelisting addresses the shortcomings of influencer marketing and provides brands who are willing to invest a leg up in the social media marketing world. Case studies by Lumanu have shown that influencer ads for prospecting outperform brand ads by 20-50% across consumer categories (fashion, beauty, health & wellness, and CPG).

The brands that are poised to succeed in today’s digital landscape have unique brand stories and can tap into influential voices to tell that story at scale to different consumer segments. 

How does Influencer Whitelisting work?

Simply put, influencer whitelisting is the process of gaining advertiser access to an influencer’s social accounts to run and optimize paid media behind influencer content (turned into ads). Optimizations may include things like editing copy on the influencer’s post to add a discount code, turning a carousel into a slideshow, testing various taglines and CTAs, adding/ removing a giveaway for free products and much more. As organic reach on influencer posts continue to drop across all platforms, whitelisting is necessary to deliver ROI from influencer marketing programs. However, the process of influencer whitelisting can be challenging as it’s not a simple process for creators and partnerships between brands and influencers are agreed to without established industry norms.

Benefits of Influencer Advertising

  1. Advertising via Influencer Whitelisting is the most powerful way for brands to amplify influencer content

    The real power of whitelisting comes down to two things: 1) the target audiences you can reach and 2) the ability to optimize for sales and CPA/ROAS. Whitelisting allows amplifying influencer content with a conversion objective to drive and measure sales for your influencer marketing campaign. Whitelisting allows you to build lookalike audiences from your influencer’s first-party data, ensuring you reach an audience likely to engage and purchase. These can even be built off of viewers of specific videos. The beauty of influencer content is it can influence consumer behavior far beyond an influencer’s organic following, which is required especially in light of the uncertainty of algorithms and steadily declining organic reach. This holds true across micro-influencers to celebrities and negates the importance of organic reach and engagement rate.

  2. Bring media best practices to your influencer content

    The ability to transform and iterate on influencer content delivers a huge advantage when it comes to gaining consumer attention. Advertisers who scale their influencer marketing strategy have a ton of content to test. At the creative layer, you can turn single images into slideshows, or interweave brand creatives with influencer creatives within one carousel or video. Testing different taglines and CTAs like “Shop Now” or “Learn More” end up creating an endless supply of ad creative which is always a need for performance marketers. The flexibility to play around with different creatives and copy allows you to find the perfect combination to deliver great RoAS and CPA through your influencer marketing efforts.
  3. The ability to create influencer dark posts

    Dark posts are paid Facebook and Instagram ads that don’t show up on influencer feeds but do appear as ads to the users you are specifically targeting This allows for several variations to be targeted at different audiences without cluttering up your influencer’s feed or sending a bunch of back and forth to edit captions (as well as annoying your influencers). When whitelisting and amplifying influencer posts you also have the option to amplify an existing post if you choose.
  4. Influencer whitelisting gives you full control over targeting

    Instead of hoping you’ll reach a certain target audience, you can guarantee you’ll reach the desired audience by applying your media strategy to the influencer channel. When running influencer whitelisting, you can also tap into the audiences of content creators and build high-affinity lookalikes. The potential customers look like the most engaged followers of your content creators and have a high probability of converting. You can also target influencer whitelisted ads to your first-party audiences like website visitors, high lifetime value (LTV) lookalikes, and abandoned carts.

    Influencer whitelisting allows you to achieve your brand’s media objectives, whether that involves getting a certain amount of reach, brand lift, page views, or purchases. This also means you can measure the tangible return on investment in your influencer campaigns and content to justify future investment in influencers.

    Media tactics and execution are very complicated to convey to the influencer or talent agency if they were to boost the ads themselves. Your ads will not be as effective if you hand over control of the media buying, you need to run this in-house or through your paid marketing agency. Furthermore, lack of transparency often means you don’t know how much of your media budget goes into actually buying ads on Facebook and Instagram -- ultimately impacting KPIs like CPA and RoaS.
  5. Access valuable insights on how the influencers paid and organic posts are performing relative to each other

    Whitelisting allows you to compare influencer performance within audiences and keep a pulse of how well each influencer performs against your marketing objectives, from in-demographic impressions to conversions.

    These insights can help you understand whether your investment is justified and inform marketing budgets. You can also use these insights to inform future influencer creative briefs and prioritize influencers who are similar to your top-performing influencers. Wouldn’t it be great to work with the right influencers every time? Relevant influencers can move from the ones who drive engagement to the the ones you know can drive purchases.
  6. As an added bonus, since the dark posts are run as ads and called out as "sponsored", their are not federal trade commission disclosure concerns with influencer advertising. The organic social media posts still need to have proper ftc disclosure in place. When running darkposts you can remove #ad #sp, etc.

Challenges With Influencer Whitelisting

The bottom line is influencer whitelisting drives sales. With that said, it’s not easy. It’s an evolving space and the process still has some challenges brands should be aware of: 

  1. Information asymmetry

    Since the brand can run all ads through an ad account they own, influencers have very little visibility into what is happening with their identity and content.  Whitelisting often causes tension between brands and influencers: how much visibility should the influencer get, what dark posts have been run and what is the brand allow to do once they gain advertiser access to the influencer’s accounts? Generally, influencers have no idea what ads were run on their behalf, let alone how their content performed for their brand partners. There is often a need to build trust in order for both sides to build trust.
  2. Assigning whitelisting permissions

    The actual whitelisting process is not easy. The process to assign permissions varies depending on if the influencer has a business manager, if their account is set to a business profile or a creator account, or if they grant permissions via Instagram or Facebook. Unfortunately, investing in a walkthrough deck to handoff to influencers does not work and the ongoing program will likely involve several phone calls and screen share sessions. As a rule of thumb brands often plan for at least 30 minutes “live” with each influencer. These are often difficult to schedule given travel schedules and time zones.
  3. Contract language confusion

    Contracts that loosely mention advertising or whitelisting permissions without details of what those permissions entail leaves room for disagreement and even lawsuits. Brands have legal resources at their disposal, so unless the influencer has a strong legal background, they’re unlikely to understand half of what they’re signing away. And there is often confusion if one side doesn’t hold up their end of the agreement. Whether it’s the brand using content beyond what the contract allows (and the influencer sending a bill, cease and desist, or even filing a lawsuit), or the influencer breaking terms they didn’t know existed (resulting in cessation of the contract terms in full, or demands for fresh work and contract extensions), there’s a lot of confusion. On the brand side, it is often very difficult to keep track of which content is allowed to be used where and for how long. The entire industry is often spending more time talking about whitelisting (and working out the kinks) than actually whitelisting strategically.

In spite of this, whitelisting is growing and being adopted by growth-focused brands. This powerful tool is changing the game of endorsements, sponsorships, brand reviews, and word of mouth marketing tactics.

Tony Tran is co-founder and CEO of Lumanu. Prior to Lumanu, Tony was at Outpace Systems, McKinsey, and Google in various product management and business strategy roles.
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