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Where Do You Fall on the Philosophical Spectrum of Influence Marketing? Influencer executions look an awful lot like advertising, public relations and everything in between. Knowing where your philosophy falls leads to smarter execution.

By Jason Falls

Opinions expressed by Entrepreneur contributors are their own.

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Jason Falls' Winfluence: Reframing Influencer Marketing to Ignite Your Brand is out Feb. 23 via Entrepreneur Press. Pre-order your copy now via Amazon | Barnes & Noble | IndieBound | Bookshop.

When the first inklings of what we have come to call influencer marketing emerged in the late 2000s, Instagram, TikTok and SnapChat didn't exist. Facebook was actually barely a thing at that point, because only college-tied emails initially earned access to the platform. YouTube existed, but web video was still complicated and cost-prohibitive for the masses. Influencer marketing back then was primarily focused on blogs and Twitter.

IZEA was the first company to force the issue on turning social media content into sponsored-message opportunities. The first iteration of its company name was actually PayPerPost. It launched in 2006 and offered bloggers everything from gift cards and free product to cash payment in exchange for a written post about experiences with its clients.

In 2009, IZEA launched Sponsored Tweets, and the world of online content creators taking money for social media posts was off and running. The concept seemed simple, but the execution was quite complex. To that point, people followed social media accounts because the content creator provided good information, entertainment or just engagement consumers found useful. Lack of commercial interruption was part of the reason why people paid attention in the first place. Social media was a safe place, away from ads.

Early criticism of IZEA from social media pundits (including me) was that breaking the seal of commercial gain for posting to a social platform would destroy its hippie-esque, kumbaya aspirations. Today, some would argue it did just that. Others would accurately point out that the current advertising-first state of social media platforms is the result of the networks having to develop a sustainable business model. The influencer piece of it was just coincidental. But the pay-per-post approach introduced us to the transactional philosophy of influencer marketing.

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Why the transactional model works

Transactional influencer marketing works because the C-Suite understands it. We pay you X, you post Y. We measure the outcome and hope we all go home happy. It's aligned nicely with the experience of advertising.

The analytics can be translated into a familiar language. If I pay an influencer $500 and the content generates 150,000 impressions, I know that influencer's CPM was $3.33. I can assess that along side the CPM for pay-per-click, online media and even email marketing programs and compare apples to apples.

We can argue all day as to the efficacy of an influencer posting about your brand online, but there's a reason a company like Estee Lauder spends 75% of its $1 billion-plus marketing budget on online influencers. It works.

But transactional is the antithesis of 'social'....

The naysayers for IZEA's Pandora's Box of commercial infiltration were social media purists. They evolved from The Cluetrain Manifesto mantra that paved the way for the universe of "social" to come into being. It said, in essence, "Stop yelling advertisements at us you marketing turds!"

So, transactional influencer marketing has always had its detractors. They prefer products and services to be more naturally integrated into an influencer's content, if at all. This crowd kicks around words like "genuine" and "transparent" as if they're hacky sacks on the college quad.

They eschew sponsorships for partnerships. Those at brands or agencies approach influencers much like public relations professionals might approach a journalist. It's not about placing an ad, but winning a fan; better yet, building a relationship.

Why relational influencer marketing works

Though more difficult to see in tangible returns, relationship-based influencer marketing is typically more beneficial for a brand in the long term. Paying 10 influencers $2,500 each to post about your Q2 campaign will yield a few dozen social media posts that help a limited number of people know about your thing over the course of three months. But spend that same $25,000 budget on a year-long content partnership with four influencers who get to know your brand so well they could serve as fill-in spokespersons for it, and the impact can be more significant and last longer than the year of the investment.

It's almost the difference in investing in customer acquisition versus customer retention. One is a short-term success story. The other reaps benefits for years to come.

What's right for your business?

The answer for any "What's right for you?" question is always, "It depends." If your business is dead set on a short-term exit strategy that depends on driving a certain number of customers quickly, any influencer marketing dollars should be invested in a transactional approach. If you're playing a longer game and hoping to drive customer loyalty or brand value over time, relationship-based influencer marketing may be a better fit.

For most businesses, finding the perfect balance between the two extremes is ideal. Every business experiences transactional needs. Influencer marketing has a solution for that. Every business can benefit from a long-term investment in relationships with influential online content creators. Influencer marketing can cover that, too.

As an entrepreneur or marketer, you need to consider the pluses and minuses of both to determine which influencer marketing philosophy you subscribe to. Doing so will help you make informed decisions about which influence partners to use for various marketing efforts. Understanding the philosophical spectrum of influencer marketing is also useful in determining which software solutions, service providers and agencies will best suit your needs.

IZEA is still one of the largest and most successful influencer marketing software providers in the worls, and it is still a very transactional solution, philosophically. Others, like Onalytica, have a more relationship-based pedigree. Still others even refuse to make cash payments part of the influencer equation.

Related: HBO's 'Fake Famous' Documentary Gets Influencer Marketing All Wrong

Regardless of where you wind up on the spectrum, knowing the extremes will help you make smarter decisions and succeed with influence marketing.

Jason Falls

Entrepreneur Leadership Network® VIP

Digital Strategist, Industry Analyst, Speaker, Author

Jason Falls is a noted author, speaker and influencer in the social and digital marketing space. He is the senior influence strategist at Cornett, an advertising agency in Lexington, KY. He is the author of three books on digital marketing, including Winfluence — Reframing Influencer Marketing to Ignite Your Brand, from Entrepreneur Press. 

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