How Nano and Micro-Influencers Can Make Money in 2020?
Over the last couple of years, influencer marketing has seen a shift in trend. You may or may not have noticed it, but now we’re seeing brands, even the heavy hitters, pumping more money into influencer marketing than ever, and more of it is going to the nano and micro-influencers.
With the up-rise of nano-influencers, influencer marketing has become much more affordable for brands.
With the right implementation, startups can utilize influencer marketing and not spend thousands of dollars doing it.
How to Differentiate these Influencer Types?
Well, influencers are categorized by their follower ratio. There are nano, micro, mid-tier, macro, and mega influencers.
- Nano-influencers have 1k-10k followers and boast extremely high engagement rates of between 4%-6% on average!
- Micro-influencers possess 10k-50k followers and boost engagement rates of generally between 2%-4%.
A great example of a nano-influencer on Instagram is Bricely Liriano!
Her campaign for Eva Hair NYC’s hair tools launch for Christmas 2019 has a whopping 4.5% engagement rate.
What’s so appealing about these influencer types to brands and Instagram users is their authenticity as they are just “regular people” and don’t perceive celebrity statuses, like the macro and mega influencers.
How Nano Influencers and Micro-Influencers are Cashing in?
Nano influencers and micro influencers are approached by brands on social platforms and using influencer marketing platforms to strike deals.
Influencer marketing platforms allow brands to find and collaborate with influencers much easier as opposed to reaching out directly via social platforms.
Brands reaching out-negotiate and strike deals with influencers and pay them once their content demands are met.
Influencers simply post on their social platforms based on the demands of the brand and once the campaign is complete, they receive payment most popularly through PayPal.
How Influencers Can Make Money for Brands?
Macro (500k-1m followers) and mega (1m+ followers) cost too much upfront for most brands. These influencer types want in excess of $5,000 per post! For many, especially small businesses, this is too much money to fork out at once.
So, why are brands choosing to invest in nano-influencers and micro-influencers and not their counterparts? For the simple fact that lower follower volume influencers are so effective at a lower cost.
According to eMarketer.com, nano influencers and micro-influencers demand the least amount per creative considering their follower count is the lowest of the groupings. For clarity on the chart below, power is the same as macro and celebrity is the same as mega.
Paying for a post, video, or story is very cost-effective as seen in the chart until you get into paying for macro and mega, which increases dramatically! But, the most defining thing about nano and micro-influencers is their engagement rate as they average upwards of 3%.
A high account engagement rate means audiences are more likely to interact with content.
Why? Because they’ve built a trust with their followers and are more involved with them, their engagement rates are higher, meaning more users will engage with the influencer’s sponsored content.
Many brands have wasted money on higher follower account influencers not knowing many of those followers were fake and they don’t really engage with their posts. This means brands are forking out thousands of ad dollars and aren’t getting the results they expect.
All in all, nano and micro-influencers are cheaper, have higher engagement rates, and are well trusted by their audience as they have fairly strong relationships with them.
Many influencer marketing platforms have built-in algorithms that detect how much of an influencer’s followers are robots (fake).
However, the majority of the followers of nano and micro-influencers are real, however, use a platform just to be sure and to make the process of hiring influencers much easier.
Michelob Micro-Influencer Campaign
The influencer below is an example of a golf micro-influencer promoting a luxurious looking beer, Michelob Ultra Slim, to golfers that follow him due to the knowledge that many golfers love to drink beer casually while they play.
This is a good strategy from the Michelob and it was likely very cost-effective while lucrative. So far, the video has 31,500 plays since September 2018.
That means 31,500 different Instagram users watched this video for at least 3 seconds. What’s great for Michelob is that they’ve probably spent approximately $300-$500 to harness 31,500 different eyes to increase brand awareness.
Do that with 3-5 different influencers and you’ve spent about around $1500-$2000 for over 100k different eyes and potential customers.
You’d have to spend that or more to influencers with 150k-200k for one campaign and generally, their engagement rates and views aren’t that high. Many of their followers know they’re being sold on multiple products on a fairly regular basis and they lose trust with the influencer.
Sperry’s Utilizes Nano Influencers and Micro-Influencers
In 2016, Sperry shoes worked with more than 100 nano influencers and micro-influencers on Instagram to create engaging content promoting their boat shoes.
Sperry wanted to work with users who were already creating content with their shoes and In exchange for exposure and recognition, these micro-influencers provide Sperry with quality, authentic imagery, posting it to their official Instagram account.
The above post, featuring a photo taken by @slavatheshrimp (4,000 Instagram followers), was Sperry’s most-engaged photo of 2016. You can see why it got so much engagement!
The takeaway from this campaign is that influencers may already be talking about your brand in a positive light, why not harness that? This is exactly what Sperry did and likely at a very low cost.
Join an IMP!
You might be wondering what that is, it’s an influencer marketing platform. These platforms help with finding, reaching out to, and managing influencers and campaigns.
Most are expensive to use their software, others are more cost-effective, or even free for that matter. Here at Influencer, we are attacking the influencer market in 2020 with an emphasis on combining advanced machine learning and influencer marketing.
So what does that mean? We’ve developed an algorithm that matches brands with the perfect 5-10 influencer list. No more sifting through thousands of influencers and struggling to find one that works for your brand!
Our model helps brands save time and money. Added, we’ve placed focus on nano and micro-influencers on our platform with engagement rates of over 2%.
Lastly, our platform includes campaign analytics so it’s much easier to see which influencer is directly increasing sales or other goals.
What Startups Should Take away from This?
What brands should take away from this is, nano influencers and micro influencers have the ability to push a brand’s sales and awareness at a low cost, and for the most part, more effectively than macro and mega influencers.
Why? Because these lower follower count influencers more than likely have real followers and have built a strong relationship with their followers.
This bodes well with higher sales and awareness considering there are real followers willing to engage with relevant content. When an influencer’s followers are flooded with robots and many of the real followers feel like they’re always being flooded with sales pitches, they disengage, lose trust, and inevitably become dejected.
Start off Small and A/B Test
Startups can still use influencer marketing in a cost-effective way. Start off by spending a couple of hundred dollars on a micro or nano influencer and see what it does for your business.
Invest a couple hundred more with a different digital influencer and see how if it has a positive effect on your business again.
If you find there’s been a direct boost in sales or a rise in traffic on your website due to an increase in brand awareness, then the campaign you could deem successful.
Influencer marketing done right can boost startups to another level of sales and brand awareness.