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Are Nano Influencers the Future of Marketing? The 2019 Consumer is sick and tired of ads being pushed at them by TV, Print, Billboards, and even Google and Facebook and this what they are looking for

By Sumedh Chaphekar

Opinions expressed by Entrepreneur contributors are their own.

You're reading Entrepreneur India, an international franchise of Entrepreneur Media.

If you've ever thought deeply about advertising or marketing, you'd know that the most effective way of advertising a product or service is word of mouth.

Simply put, would you rather buy a face wash because you saw a billboard of Alia Bhatt advertising it,

or if your friend said to you, "Dude you should use this face wash, all my pimples went away"?

The macro view of advertising simultaneously very simple and extremely difficult. This is my perspective is two basic laws:

  1. People trust people, people don't trust companies

  2. As you move higher in the influencer hierarchy, the outcome is directly proportional to Brand value generation and indirectly proportional to purchase behaviour.

Let's understand the first one.

The internet has single-handedly democratised content consumption. YouTube alone has approximately 250 million users in India and it's a platform where anyone with an idea and a phone can become a huge content creator.

So, for most people, the days where the TV channel decided what you'd watch, combined with the time sensitivity (e.g. tuning in on a particular time to watch content) are Gone.

The days when newspapers were printed by one publication for over 50 million people are gone.

Primarily its 2 things.

One. Traditional media is fixed in place, it doesn't have an algorithm that's fluid based on user behaviour.

So, it is bound to be replaced by the digital counterparts which are custom to each user. (Even traditional media companies have an internet or dotcom division, many of which are doing better than their physical counterpart)

Two. The 2019 Consumer is sick and tired of ads being pushed at them by TV, Print, Billboards, and even Google and Facebook. (According to analysts, India experienced a digital ad spend growth of 28per cent in 2018, which is one of the highest in the world)

The 2019 consumer doesn't trust any and no matter how well-done the storytelling is. This is clearly exhibited by the rise in the number of people using products like AD-Block. The Consumer now only cares about what, the 10-20 they trust, have to say about a product/service. Combine that with our genetics which dictates behaviour that makes us trust fellow humans more than corporations,

And "word of mouth' becomes key.

Moving on to The Second Law

Imagine a pyramid in my mind.

At the top of the pyramid are celebrities like Salman Khan, Kim Kardashian etc.

These are commonly known as celebrity influencers.

They are incredible for brand awareness.

Because of their high reach (usually 5 million plus), a lot of people know about your product.

And now that they know your product exists, would they buy it?

Not necessarily.

As Celebrity influencers aren't the best medium to drive sales - back to Law 1.

Consumers don't trust celebrities enough to make a purchase decision.

Let us Move Lower on The Pyramid

We reach Mid-Tier Influencer (usually 500k-1M followers/subscribers). These are generally people who have a massive audience that they've built by creating content on social media. They create great brand awareness, although not as much as celebrities. But their effect on sales behaviour is higher than celebrities. And they've generated all of their following by creating native content on social media.

Next Step is Mid-Tier Influencers (Usually 50-500k)

This category exhibits user behaviour that follows the same thread.

Lower is Micro Influencers (Usually 10k-50k)

These influencers are generally in a phase where they've begun creating content just a couple months ago. They follow the same thread though. Brand awareness is considerably lower, but effectivity of Ads and purchase behaviour is strong.

Last, on the Pyramid are Nano-Influencers (1k-10k)

This is the most interesting place to be to you wants to ace influencer marketing. Although Nano influencers have negligible brand awareness, they heavily dictate purchase behaviour.

As their audience is small and extremely authentic, trust is high. It's recorded that micro influencers have an overall 60% higher engagement rate. They're naturally underpriced. And because their audience is small, it's easier for them to connect with each one, through messages and comments.

Nano influencers are the closest we've come to building a "Word of Mouth at scale' marketing tool.

On average, influencers in the range of 100-200k have an engagement of 8-15per cent, whereas, some Nano influencers have engagement as high as 25-30per cent. And that's an incredible thing.The challenge, however, is efficiency.It's extremely difficult to reach out to a huge amount of people through Nano influencers as you'd have to use a lot of them.

So, this entire situation begs the question, "What's better? A celebrity influencer or A Nano Influencer?'

And the answer to that is - Individually, neither.

Combined, Both. See the influencer pyramid works in harmony. You can't pull out one element from it and us it individually. The entire pyramid has to be carefully used based on what your specific product or service is.

And in 2019, we're still just scratching the surface of influencer marketing.

Sumedh Chaphekar


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