Are Influencers Outside Your Circle of Trust?

Influencers Outside the Circle of Trust

“Did I not clearly explain the circle of trust to you, Greg?… Then is there something you want to tell me?… See if I can’t trust you, Greg, then I have no choice but to put you right back outside the circle, and once you’re out, you’re out. There’s no coming back.” In case you didn’t recognize it, that is part of a dialogue between Jack Brynes and Greg Focker from Meet the Parents, 2000. It is a very funny movie. Highly recommended if you have not already seen it, but, more importantly, the “circle of trust” is a fun and memorable metaphor for how we can lose the trust of another, and, once lost, it is hard to get it back.

That is what consumers are feeling when it comes to influencer marketing – influencers have lost the trust of their followers. Influencer marketing has become such a popular channel among marketers over the past 10 years that people in all fields are trying to be a social influencer – like it is the new path to fame and fortune. Well, it is exactly that, I guess. The more followers a social influencer has, the more famous he or she is, and the more he or she could demand from marketers. But, it seems fame and fortune are at odds with trustworthiness.

Social influencers are not the gold standard for word of mouth marketing they used to be. Consumers have lost trust in social influencers. According to the Wave study from media agency UM, the majority of global internet users have little to no confidence in what influencers say online. Only 8% of people believe that information shared on social networking sites is true, and that drops to 4% when the content comes from influencers[1].

What happened? It is a question of authenticity. There are enough influencers that are willing to endorse everything they are paid for that consumers have become skeptical of the influencer’s authenticity especially when he or she is recommending something like a brand, a destination or a product. Take Gigi Hadid, a Victoria’s Secret angel, for example. She partnered with McDonald’s[2]. Apparently, fans do not like it when their influencer endorses something that is obviously not something they would use – or, in the case of Gigi Hadid, eat.

The Gigi Hadid case is a rather obvious inauthentic endorsement – perhaps deliberately so by McDonald’s marketing team – but consumers are not blind lemmings. We follow influencers for their authority and authenticity in their field of interest. We would follow Gigi Hadid for her style and beauty, but not to get recommendations on fast-food. 

Micro Influencers Are More Trusted

The influencer marketing industry has been evolving. Marketers have shifted from seeking the influencers with the largest number of followers to a particular segment of influencers they categorize as micro-influencers -influencers with 1,000 to 10,000 followers. This is because micro influencers have the highest engagement rate and now “perform the bulk of successful influencer marketing (at least 90% of it).”

CircleOfTrust-MicroInfluencers

In fact, statistically, the fewer followers an influencer has, the higher the engagement rate as shown in the results provided by SocialPubli.com below.

Screen Shot 2019-11-26 at 8.43.27 AM

And it makes sense. Here are the main reasons why influencers with smaller followings have higher engagement rates:

Followers makeup: Their audience is still growing and made up of people they have met, people who have followed them from the beginning, people who generally love their content and people in their personal friends and family network. 

Their ability to be personal with their audience: Micro-influencers cherish their growing community, and they are readily available to attend events, interact with followers, reply to comments, engage with their community and have a presence offline, as well as online. 

Authenticity: Their audience trusts them, which is more uncommon when it comes to macro-influencers who regularly work with a wide variety of brands, and are known to take on paid advertising projects. 

However, as micro influencers grow to become macro influencers, it is almost inevitable that they will experience some degree of decreasing engagement rates. Their new followers would likely not have been connected first-hand with the influencer, and the influencers would have less time and ability to interact with most of their followers.

For Recommendations, Authenticity is Key

The one area influencers could maintain control in their quest for engagement as they grow is to be authentic, but that would mean loss of marketing deals. It is a conflict of interest. How can an influencer get paid and still maintain objectivity? Is it not almost a like switch: as soon as the influencer posts a paid recommendation, followers become skeptical at his/her authenticity?

Well, not necessarily. It is possible to be a mega influencer and still convey authenticity. Take Austin Li, the top reviewer of lipsticks on XiaoHongShu with 3.2 million followers. Despite such a large following and knowing Austin is being paid to recommend and/or sell the lipstick, his recommendations can still garner 3.8% engagement rate (which is relatively high for such a large following). Austin has been able to do this because of his authenticity and authority on lipsticks. He appears impartial when it comes to recommendations. If he is not into a particular product, his blunt criticism of big brands conveys trustworthiness.

Authenticity plays a very important part in follower engagement rates, but not all influencers are or can be as authentic as Austin Li. The web is riddled with stories telling of social influencers asking businesses for discounts or services for free with the promise of sharing a favorable post on them. While this business proposal may be mutually beneficial for the influencer and the business, as consumers of the influencer’s post, we have to wonder, how authentic is this recommendation?

While there may be exceptions, the inherent conflict of interest between influencer and influencer marketing no doubt exists. 

Avoiding Conflicts of Interest

As consumers, we should always be weary of conflicts of interest when someone is recommending something to us. We have to judge whether a recommendation is trustworthy or not no matter who it comes from. Influencer marketing is a difficult channel to trust given the inherent conflict of interest – at least when it comes to recommending things. Marketers and influencers need to find a compensation solution that does not dilute the authenticity and authority of the influencer and at the same time conveys the desired message to the intended audience.

One solution that influencers could do to maintain a sense of authenticity is to show on their recommendation post that it is a sponsored ad. This way it is more transparent. Followers can judge for themselves if the post is authentic knowing it is paid. However, for the same reason, it could hurt the marketer’s ROI, and so there may be pressure from marketers not to do so.

Community Forums, a Trusted Recommendation Channel

Reviewers, such as Consumer Reports, whose compensation is not paid by the marketers, are more trusted for recommending products, but, these review channels work best for hardware and have problems attracting the younger generation, because such reviews lack personal attachment. 

Search apps, such as Google and Yelp whose reviews are generated by users, can be authentic, but they do not only lack the authority that influencers and professional reviewers portray, they also lack psychographic alignment and curation provided by those other channels. 

Community forums like Facebook Groups and Reddit are good channels to get custom recommendations. Recommendations from community members are perceived as personable, authentic and psychographically-aligned, and, while they may not portray as high of a sense of authority as influencers, the reputational risk taken on by the recommender in front of his or her peers does provide a sense of assurance. From this perspective, I think community forums are most similar to influencers’ recommendations compared to the other alternative recommendation channels, and community forums are not subject to conflicts of interest – at least not yet. 

CircleOfTrust-Communities

However, community forums are a different kind of social platform. They are different from the likes of Instagram and Weibo where users follow influencers and discover recommendations. These Instagram-type social platforms are much more pushed based than pull. Whereas community forums are more equally pull and push. Members can ask questions, suggest recommendations, or simply discover what others are saying. Where push-based social channels are like watching your favorite celebrity on TV, community forums are like discussing what you just saw with your friends. I believe they are complementary. Your favorite celebrity chef, Gordon Ramsey, recommends his own chain of restaurants. Your foodie community members can tell you what they thought of the restaurants and suggest alternatives.

Can Marketers Leverage Community Forums?

We know marketers gravitate to social influencers. While community forums usually have a focus on a topic, as opposed to a focus on an influencer, they can still be great channels for marketers nonetheless. 

If a community is formed on the basis of recommendations (as opposed to general discussions) then members are essentially there to “shop socially” with like-minded people. This particular type of community forum would be like a direct sales party – think Amway and Tupperware – but instead of just a party for one brand, it is an on-going party that members can introduce any brand. In this party, marketers can find existing members, who would be willing to try out their products and have them introduce the product to the community. While the member might not have the same authority as an influencer, he or she would likely be trusted and because he or she is more of a peer would foster more dialogue about the product.

Taking this direct-sales party model further, XiaoHongShu is effectively one large direct-sales community for fashion and beauty products and mega influencers have grown out of XiaoHongShu’s platform. So even within communities, assuming they are large enough, influencers can play a role. The problem is once it gets that big, the sense of a community may diminish, and the platform becomes more like that of a platform for following influencers rather than one for joining communities. To maintain the feeling of a supportive and engaging community members must feel they can always give and get open and direct feedback no matter how big the community gets.

The Bumping App – Recommendations from Trusted Communities

Having had a number of disappointing experiences dealing with service providers and witnessing how conflicts of interest result in questionable authenticity and hence trustworthiness, we decided to create a tool that aims to provide consumers with trustworthy recommendations. To this end, we have designed the Bumping App to leverage the trusted and engaging characteristics of community forums with a focus on recommendations. We want to make giving and getting recommendations as trustworthy, efficient and relevant as possible. The Bumping App is designed to make you feel you have the validation of your support group no matter what you are doing. Give it a try today!

Sources:

[1] Hands up. Who Trusts Influencers?, Dominic Carelse, Miappi, May 24th 2019, https://miappi.com/alternative_to_influencer_marketing/

[2] Do your customers trust influencers? KELSIE RIMMER, Tribe, https://www.tribegroup.co/blog/do-your-customers-trust-influencers?

[3] 50 Influencer Marketing Statistics, Quotes and Facts, Influencer MarketingHub, Nov 14th 2019,  https://influencermarketinghub.com/influencer-marketing-statistics/#:~:targetText=There%20are%20three%20types%20of,least%2090%25%20of%20it).

https://www.scrunch.com/blog/micro-influencers

https://www.linkedin.com/pulse/top-1-lipstick-kol-xiaohongshu-guy-miro-li/

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