Have we reached peak influencer marketing?

With major brands like Unilever increasingly scrutinizing influencers over fake followers, and platforms like Twitter getting more aggressive about removing bot accounts, the answer to that question just might be yes. But that doesn't necessarily mean that we have reached peak influencer.

That's because even as brands rethink their approach to influencers, some influencers, particularly those with large followings, are rethinking how they work with brands. And a growing number of them are deciding to forgo taking cash to promote brands. Instead, they are launching their own brands. 

The latest example of this: Emma Chamberlain. In just over a year, the 17-year YouTube star has accumulated 3.6m subscribers on the popular video platform and is the latest influencer to prove that enough of those subscribers can be turned into customers to start a brand that just might be viable.

As detailed by AdWeek, Chamberlain last month unveiled a storefrontdubbed Low Key to presell clothing and accessories for a brand she was launching. Amazingly, followers who were eager to buy the products did so despite the fact that the product images were pixelated and the product names scrambled. In other words, they couldn't be quite sure what they were getting.

Among the products that sold out was a scrunchie that was offered up for $25 during the presale. It was gone in under 30 minutes. Now, Chamberlain has restocked her products, which are being sold under the brand name High Key, and the YouTube influencer is selling them exclusively via a storefront within Dote, a mobile shopping app that is popular with Gen Z. 

The notion that a teenage YouTuber who nobody knew about a couple of years ago could acquire a large fan base, launch a new brand and have some success doing so might seem crazy to, say, anybody over the age of 30, but this is the new world we live in.

As Lauren Farleigh, the CEO of Dote, told AdWeek, "For a Gen Z girl today, they’d rather shop from their favorite YouTuber, their closet, their preferences, than from a top-down Urban Outfitters or other brands like that. Their celebrities are these YouTube creators and social stars."

A more complicated picture for brands

The sway of influencers like Chamberlain explains why brands have been pouring larger and larger amounts of money into influencer marketing in recent years. In a number of industries, such as fashion and beauty, influencers are playing such a critical role that brands are forging long-term relationships with influencers under which they co-create new products. 

But as the number of popular influencers who are building multi-million and even billion-dollar businesses of their own grows, existing brands are likely to find that it's more difficult to work with big-name influencers. After all, more of them are likely to try their hand at launching their own brands.

While many of them will find that building a business and a brand is harder than it looks, and as a result many won't be as successful as the Michelle Phan and Huda Kattans of the world, so long as there is a perception that brand building can be more fruitful than cashing checks from existing brands, some influencers will attempt to do it and existing brands will need to make adjustments.

Those adjustments could involve working with influencers who aren't quite as popular, including microinfluencers. The goal: identify the next generation of up-and-coming influencers and establish relationships and loyalty early on. Of course, as some of those influencers graduate to become mega-influencers, they too might decide to launch their own brands, leaving the brands that helped them gain credibility in the dust.

With this in mind, brands, especially those in the industries most impacted by the rise of influencers, might want to start thinking about influencers less as marketing tools and more as potential investments. Instead of treating influencers as a means to an end, brands should recognize that they might be the end.

Knowing that influencers are proving to be capable brand builders, existing brands that aren't already doing so should consider launching investment funds and even incubators to help them launch those brands. In many cases, their money, manufacturing capabilities, distribution networks and operational expertise will not only be a source of great leverage, but could help them defend against competitors who might otherwise wind up buying some of these influncer-launched brands if and when they achieve the scale required to become M&A targets.

For more on influencers, visit the Festival of Marketing 2018, October 10-11, London.

Patricio Robles

Published 9 August, 2018 by Patricio Robles

Patricio Robles is a tech reporter at Econsultancy. Follow him on Twitter.

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Comments (1)

Pete Austin

Pete Austin, Founder and Author at Fresh Relevance

It's only a matter of time before influencers are using Initial Coin Offerings to monetize their "careers", so brands can literally invest in them.

7 days ago

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