Influencers and High-end Luxury
Some of my businesses is in the luxury hospitality industry. A lot of our products are mostly about the experience. How beautiful the place is, what it feels like to be there, the quality of the service, the quality of the food and drink… All of this is very hard to communicate through normal advertising. And for a long time, people in this business have looked for ways to make an impact on their target audience, more effectively and economically.
The Internet has completely changed the game of advertising. It used to be luxury properties would buy big ads in publications that were consumed by their target market: luxury magazines, financial newspapers, perhaps sponsoring high-end events, and hope that the ads would work. Today the game is different. I am the hardest ever to get as a consumer, and I think this is true for most people. It has never been harder to reach me and sell me on something. There is so much noise, so many messages bombarding me all the time. I have become very good at ignoring anything online that is not exactly what I am looking for. At the same time it is easier than ever to measure, especially with products that are sold online, how effective advertising is, or isn’t.
I think this is part of the reason why influencers are such a big deal now. Influencers are people who have a large community of followers on social media. Some of them have millions of followers, some of them hundreds or tens of thousands. They promise, through the attention they have from their audience, to help us sell our product. The idea is simple: “People are following me, and if they see me using your product, they are going to want to buy it.” The influencers propose that because they are not an ad, they can cut through the noise, and get your product front and center. The idea is also that because they have influence, they can inspire people to buy your product: they can create an emotional bond between their audience and your product.
Influencer marketing has exploded in recent years. We are at a point where you could spend tens or even hundreds of thousands of dollars, to hire an influencer to post a picture of themselves using your product on Instagram, or create a video that involves your product for their YouTube channel.
I have watched this phenomenon take off, and I often wonder how effective influencer marketing really is. Everyone is talking about it, everyone is doing it, at least a little, and everyone is hoping it will be the next big thing. Especially in the luxury market, where our consumers are typically sophisticated, I am not sure influencer marketing works that well. I have several questions, that I would consider before making a substantial investment in influencer marketing, at least for promoting luxury products:
- Does the influencer you are considering have a large following of people who are your target market? This question is crucial for luxury products. Most people cannot afford luxury products, and if the influencer you are considering has a large following, chances are most of them are not your target.
- Does your target client really need to be “inspired” to want your product? Most people who can afford the highest-end luxury products are sophisticated and knowledgeable. They know exactly what they want and they buy on their own terms: larger purchases are most likely well-considered decisions.
- How well can you measure your results? Can you create an influencer marketing campaign that you can really measure? Will you be able to tell, clearly, whether the campaign worked or not, and how much? If you can’t measure your results very clearly, you are better off investing in a different approach.
I am a big believer in sales professionals. Personally I have been involved with high-end luxury goods and services from a very young age, and I can tell you, a professional sales person with the right understanding of your target market, and the right relationships, can give you a tremendous return on investment.
From what I have read in popular business magazines recently, influencer marketing can be an excellent investment if it is a good fit for your product. But at the same time, several of the most glowingly positive articles I found about influencer marketing were written by high level executives at influencer marketing agencies. Like with everything on the Internet, you must be careful about who the sources are of what you are reading. Things are not always what they seem.
While the mega-stars of social media continue to command huge fees for product placement, I think for some brands, and some companies, the results have not been as spectacular as the costs. There is a lot that goes into someone making the decision to buy something. While it is possible that an influencer could spread awareness of your product, the way that makes your product or brand look may not be what you were hoping for. More works need to be done to really make the influencer marketing process scientific.
Be smart: measure your results carefully, test, stay open to different hypothesis and consider your options with objectivity. If you do this, you may not always succeed, but you will always get closer to succeeding.
Thanks for creating a space yo learn and question about this new way of marketing… Interesting
Love the precision. Very informative