December 6, 2022

Entrepreneurship updates

The writer is London-based co-founder of footwear brand Sante + Wade

He was a little on the serious side; in-house counsel at a shipping firm with no discernible interest in women’s fashion. Yet his ears pricked up at the conversation between his wife and I as we sat at the kitchen table talking about my new business. 

“What’s your marketing strategy? Where are you going to sell your products? How are people going to find out about your brand?” he asked. 

All valid questions, for which I had answers, but it signalled the beginning of what I have come to realise is an unintended consequence of starting a business: everyone — from family and friends to random strangers — will offer you unsolicited advice.

One nugget from the hall of fame is that many people will tell you to “find an influencer”. This is usually delivered in assured tones as the only decision you need make in order to sell your wares and guarantee success.

This is not entirely wrong. Think of the association between Michael Jordan’s gravity-defying dunks and Nike, or what George Clooney’s rakish charm has done for Nespresso coffee. There is a certain alchemy at work when influencers and brands team up, their recommendations and megawatt smiles percolating in our collective consciousness. 

While access to A-list celebrities is beyond the reach of most small enterprises, further down the food chain there is more chance of collaboration. If anything, in fact, there is possibly too much choice.

The influencer marketing industry is forecast to be worth $13.8bn in 2021, up $4.1bn compared with last year, according to the latest Influencer Benchmark Report. But how do brands, particularly small businesses, pursue this marketing strategy?

“You’ll find there is some low-hanging fruit,” say the owners of The Steak Shop, an online meat supply company. “After this it gets more difficult. You must continue to scour the internet for the best creators. Worry not so much about subscriber count, but [rather the] engagement and views rate [as] this is much more important and will help your results.”

The Steak Shop, which is sister to Steak on the Green, an award-winning restaurant in west London, was founded during the first lockdown of 2020. The ability to reach a large, targeted audience who trust the influencer’s opinion was transformative for the business.

They started slowly, gifting cuts of meat to content creators who would invariably post YouTube videos of themselves searing steaks in their back gardens. The results were immediate: increased traffic to their website and an uplift to sales. So much so that the company has now hired a manager to focus on this marketing strategy exclusively.

But for every success story there is a cautionary tale. Blue Elvin, a brand that creates protective sportswear for women who weight train, found the experience disappointing. They gave away a lot of products, but the influencers did not deliver in terms of sales or content. As a result, they see this approach as being more relevant for bigger companies. 

“It is a great strategy for larger brands who have better profit margins, tonnes of stock and multiple products,” says co-founder Tamara Short.

“They can offer more attractive packages to influencers that smaller brands just can’t afford,” she adds. “. . . It’s a numbers game, and so you’re up against it from the start.”

This is a difficult situation to navigate for small businesses. It is hard to make demands if you cannot afford to pay, but with no power of enforcement, companies can feel exploited when expectations are not met.

That is where authenticity is key: finding people who love what you do and would use your products regardless of whether or not they get paid.

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Indeed, for now, Blue Elvin has shunned short-term influencer partnerships in favour of building a paid ambassador programme. This has allowed them to find athletes who share their values. “It is much more purpose-driven than the way we previously worked,” says Short.

If they were to explore the influencer route again, Short says, Blue Elvin would focus on working with micro-influencers, with fewer than 15,000 followers. Research suggests that this category tends to have greater engagement, compared with accounts with larger followings.

But either way, influencer marketing is still no silver bullet — which is what I told my friend’s husband before graciously thanking him for his advice — and needs to be executed alongside additional activities such as events and paid ads. 

My business experience of this marketing strategy has fallen somewhere in between the two examples above — and we are still refining our marketing mix. It is all trial-and-error, but if you are lucky, the combination might just turn to gold. 

 

https://www.ft.com/content/ce9422d3-6a35-484d-a777-160ae9919854