Despite the economic slowdown and reviewed marketing budgets, brands are still expected to continue to invest in influencer marketing. While budgets may be revised downward, brands are likely to invest more in their partnerships with influencers to reduce their overall costs. The reason is that influencer content is the cheapest form of branded content.
What the economic slowdown means for the sector
As a result of this shift in priorities and this greater focus on influencer marketing, we are also expecting that brands will increasingly move their activities with influencers in-house.
Rather than focusing solely on one-off sponsored posts, as this has often been the case over the past few years, marketers will be encouraged to put their influencer marketing strategy at the centre of their overall objectives. There are multiple reasons for this strategy but essentially it comes down to ensuring the success of influencer marketing campaigns.
Indeed, with consumers increasingly tightening their belts to face higher costs of living, marketers will need to ensure that their collaborations with influencers remain relevant to them. But, aspirational content from influencers is likely to continue to attract a wide audience on social media. According to our data, lifestyle related posts, for instance, tend to attract the most engagement from users in terms of likes and comments on Instagram.
The engagement rate for this category is higher than average. Despite the bleak economic context, consumers are in fact more likely to welcome sponsored posts for temporary escapism, offering an excellent opportunity for brands to connect with their audiences.
Why Gaming Influencers are gaining momentum
Gaming influencers are a growing segment of influencers, with a large audience on most social media platforms. They can range from skilled players who stream their gameplaying to millions of fans to professional video game players who compete in the up-and-coming esports space. Gaming influencers are more accessible than they may seem at first glance.
Their fans not only follow them for their high-level video game skills, but also for the tight-knit sense of community they have built both with the influencer and fellow fans. One example is Markiplier, a gaming influencer who has racked up almost 30 million followers.
Markiplier’s popularity results from his funny commentary while playing horror video games, keeping his audience entertained. Other popular Twitchers include Ninja, who despite being followed by only 11,000 followers, his streams gather up to 18.4 million views, each time.
This phenomenon is also encouraged by the legitimacy esport has gained, being valued at $1.38bn in 2022. It is estimated to grow at least another billion by 2025. Thanks to funds from advertising and sponsorships, prize money at competitions has become significant, for example, the International 10 hosted by Valve, offered $40m in pooled prize money.
Marketers will increasingly prioritise partnerships with Gaming influencers, even if no obvious direct ties to the gaming community exist. While the gamers’ main platform might be Twitch, they often have a following on other social media platforms, like Instagram. For instance, Samsung, Red Bull, and Hershey are some of the brands who have partnerships with Ninja, a top gaming streamer on Twitch. In 2023, more brands are expected to follow this path.
The platforms that will matter the most to brands
Two platforms remain the leading ones for brands when it comes to influencer marketing: Instagram and TikTok. Instagram’s remains undisputed when it comes to influencer marketing. It offers brands the most potential for their influencer marketing strategy.
However, competition remains sharp with the ever-growing popularity of TikTok among the Generation Z. According to recent analysis, 40% of those aged between 18-24 prefer to use TikTok, instead of Google, for their online searches. The reason for the platform’s continuing hype is the many opportunities for influencers and users to express themselves creatively.
Marketers have already understood the potential of these two platforms to connect with their target audiences. In the next year, they will increasingly adapt and diversify their strategy to the specifics of these two platforms, to fully reap the benefits they offer.
On Instagram, for example, the number of followers an influencer remains a key metric to evaluate their popularity, however brands need to continue to be mindful of bots and inauthentic accounts before agreeing to any partnerships. Only 60% of accounts are said to be owned by real people. Short format videos are the most successful on this platform as they effectively catch the short attention spans of audiences across all demographics.
TikTok ticks differently: Marketers should prioritise entertainment content to generate the most engagement. The focus is more on the content rather than the influencer. “Authenticity” is in the foreground, which is why nano- and micro-influencers are taking the reins.
The opportunities brought by live shopping
Recently, live shopping has gained momentum turning into a real asset for retailers thanks to the unique experience it provides to consumers. We expect retailers to increasingly prioritise live shopping in the year ahead, however they will face the challenges to adapt to the likes of Instagram and TikTok to attract shoppers on these platforms for shopping, while also providing them with a great experience throughout their purchase journey.
Among the hurdles retailers will face, we can mention the necessity to provide a seamless omnichannel experience and adaptability of traditional retail features on social media platforms. TikTok and Instagram are platforms that provide good creation tools that retailers can rely on, but they also need to ensure an optimised integration with their own website.
Another key point: it’s great to attract new clients in addition to the ones already retained, but this also means retailers will need to be able to handle the increase in numbers of users and generated orders. Scalability needs to be at the heart of their live shopping strategy.
Firms will also need to make internal adjustments in terms of how they work transversally with their colleagues: sales teams will need to be even more integrated with marketing teams in order to ensure the success of their live shopping strategy. If retailers manage to achieve all this, live shopping is bound to turn into a major source of revenues in 2023.
Alex Frolov is the CEO and Co-Founder of HypeAuditor.