Changing The Game: Affiliate Marketing CPS Model As The Future Of Influencer Marketing
Pandemic has changed so many plans and put on a pause so many businesses that it truly became an economic nightmare. Marketing being the most adaptable and flexible spheres was lucky enough to not only survive but also keep thriving, having gained a new path thanks to influencer marketing.
Following the outbreak of the virus, research by the Reuters Institute for the Study of Journalism found that celebrities and politicians with large social media followings were the key distributors of information relating to coronavirus. Prominent public figures and influencers
were responsible for 69% of total social media engagement with pandemic information despite only accounting for 20% of related content — showing the powerful role of social media on public opinion. According to influencer marketing agency TAKUMI even the World Health Organisation (WHO) launched its own influencer marketing campaign to spread accurate hygiene messaging.
The power of influencers
Every year social media becomes a more integrated part of our lives, and the influencer marketing boom is an obvious outcome. People are turning to their favorite Instagram models, Twitter personalities and YouTube stars for advice and recommendations on purchasing decisions. We tend to believe them more because it doesn’t look like actual advertising, rather advice from people we think we are acquainted with. Considering the fact that a lot of bloggers literally put their life on display it’s hard not to believe what they say or write. We realize that they are paid, but it looks so natural and unobtrusive that we can’t resist. Influencers are trusted by millions of consumers, and marketers are paying attention.
Over time creators have gradually become more relatable to consumers’ everyday lives and wider society, much more than brand advertising in some cases. According to TAKUMI research, 32% of consumers across the UK, US and Germany find influencer content more relatable to their real lives than brands’ own advertising content. This is particularly true among
US consumers (41%), compared with UK (29%) and German (26%) consumers. This means we tend to believe influencers much more than high-quality professional ads from brands, which simply turns into sales.
Traditional advertising that was effective before lockdown could suddenly seem entirely inappropriate as we went into lockdown earlier in the year. According to WARC new report, advertising investment is set to fall 8.1% — $496bn –worldwide this year. This compares to a pre-outbreak forecast of +7.1%, equating to an absolute downgrade of $96.4bn. Marketing strategies in different parts of the world responded to new challenges differently. In US advertisers started to work with ambassadors of their brands even more closely and consequently, while Asian brands went even further by launching whole new product lines in collaboration with famous bloggers.
Influencers and brands started to shift their communication more toward brand values and away from product. In the time of crisis, it is difficult to push merchandise, so the economy moved the market toward relationship-based influencer marketing, rather than transaction-based. The brands significantly loosened their control over content, giving influencers much more leeway on the messaging. It didn’t take long to see the results. According to TAKUMI new report, marketers clearly recognized the strong ROI potential: almost two thirds (60%) agree that influencer marketing provides the best ROI for brand marketing campaigns, when compared with traditional advertising. Surprisingly, marketers operating in more traditional advertising channels, including OOH (69%) and TV & Radio (68%) are among the strongest supporters of influencers for brand marketing campaigns compared to other forms of advertising, underlining influencers’ value beyond social media channels.
Consumers obviously prove the shift toward influencers: as TAKUMI states, a third of consumers agree that brands that use influencers to communicate are more compelling and relatable. It’s hard to resist when your favorite blogger recommends you something.
Influencer marketing being always in the shade of other marketing channels has appeared in beams of light.
Influencers stealing the spotlight
According to TAKUMI research, almost three quarters of all marketers (73%) are now allocating a greater proportion of their resources to influencer marketing than they were in 2019. Industries that hadn’t invested heavily in influencer marketing pre-pandemic are now leaning in. Marketers in sectors more traditionally associated with influencer marketing are among those most in agreement with this statement, including retail (79%) and sales, media & marketing (76%). However, other more alternative sectors are also significantly reporting a greater allocation of resources towards influencer marketing in the past twelve months, including legal (79%), manufacturing (75%), education (75%), IT & telecoms (75%), architecture, engineering & building (73%), finance (71%), arts & culture (60%), healthcare (63%), travel & transport (47%).
Surprisingly, more traditional advertising channels are among those most increasing resources for influencer marketing, including ‘Out Of Home’ (OOH), digital and billboard advertising (83.3%), print (80%) and TV & Radio (81.3%). As Pierre-Loïc Assayag, CEO and co-founder of influencer marketing platform Traackr stated, one of the industries that he has seen turned to influencer marketing in the past six months is CPG [consumer packaged goods]. It’s not that CPG companies weren’t doing influencer marketing before, but it had been a sideshow. Now it’s become part of their core strategy. Another vertical that hurried to jump on board is gaming. With people staying at home, games quickly became on demand. No wonder influencer marketing turned into a core tenet of the gaming company strategy. This reflects the growing acknowledgement of influencer marketing strength and its ability to deliver ROI across a more diverse range of channels.
According to TAKUMI, in the UK and Germany, 29% of influencers now work with brands across two platforms on average, rising to three platforms in the US (24%). The demand from influencers to explore these channels also matches that almost exactly: a third of US and UK influencers aren’t working on multi-channel brand campaigns but said they want to explore it in future.
Over the next 12 months, 58% of marketers are considering working with influencers on YouTube, followed by a further 55% on Instagram, 43% on online advertising, 35% on TikTok, 29% on TV advertising, 20% on OOH advertising, 20% on Twitch, and 10% on Triller.
CPS model as the core pillar
Influencer marketing is not a novice, it has been around since ICQ and Windows 98. However, brands have been using it with mixed success. The biggest issue with influencer marketing has always been estimating the return on investment. Counting likes is a vanity metric, not a commendable way to judge if the millions of dollars brands shell out are worth it or not. It is why brands are now moving towards a cost per sale revenue model as opposed to paying a lump sum amount for influencer collaborations.
What is exactly CPS?
CPS stands for “cost per sale” which means the marketer pays only for results. Actually, it is one of the forms of broader CPA which is “cost per action”. While CPA model covers quite a range of actions: from a simple “like” or comment on Instagram to an actual purchase, CPS is limited only to the ultimate result aka “sale”.
Instead of focusing on vanity metrics that don’t mean jack squat, CPS marketing means you’re spending money on cold, hard results. No more pumping money into vague views or impressions: you pay only for each lead, conversion, or sale you get with CPS marketing.
The results are already more than satisfying already. The biggest Russian companies such as Okko, Kinopoisk HD, Tinkoff Bank, Papa John’s, L’Etoile and Tanuki have already launched ad campaigns with influencers using CPS model. 5000 bloggers participated in the campaigns and generated a revenue of 200 million rubles, while influencers earned more than 40 million rubles.
How To Make CPS Work
To organize your CPS campaign, you should definitely prepare well: do your homework and keep our marketing team active. What to pay attention to?
1. Choose 100–200 high-quality bloggers with your target audience and negotiate with them to work using CPS.
2. Prepare wisely exclusive offer with the promo code
3. Set up the amount of commission
4. Create a terms of reference and introduce it to all the bloggers engaged
5. Put up CRM system to track the reach and actual sales for every influencer involved
6. Generate and provide voucher codes to your influencers
7. Proceed with the payments to the influencers
Is This For Your Business?
CPS doesn’t cancel traditional influencer marketing, and actually it doesn’t have to. The two can and will coexist freely. Will your business work better using traditional marketing or CPS? Let’s see!
– you sell niche products/services
– brand awareness is more important for you than sales
– your goal is to launch a new product/service and create a demand for it
If you answered ‘yes’, traditional influencer marketing most probably is still good for you. It doesn’t mean you can’t try CPS. Practically, CPS works for all types of businesses. Surely, some benefit a little bit more:
– you work on B2C market and sell mass-market products/services
– your brand is already a well-established one
– you are up to sales scaling and attracting new clients
– your products/services are interesting for the audience of the influencers
In this case CPS is definitely your choice.
Pandemic will eventually end, but the trends it brought us will most probably stay. That’s why the life in the nearest future will not be the same life as before. Influencer marketing already proved its efficiency in highly stressful and unstable circumstances, and after all this time when people got used to receive almost all the information from social media, these habits will not disappear, they will deepen their roots. Thus, influencer marketing is something worth trying, of course if your products or services are interesting for the audience of the influencers. Otherwise, no matter which model you choose, it will hardly bring you closer to your goals.
Paying influencers on CPS model is ideal for most brands because it enables optimization over time: audience, content, terms of the agreement — can and should be optimized. Plus, it makes the results much more predictable and measurable. You shouldn’t pay an influencer to post a photo of your product. You should pay an influencer to get you a customer. And that is exactly what CPS is all about. For Influencers trying to explore the CPS model, you can also check out Indoleads.com for CPS Affiliate Programs that can help you start your journey of affiliate marketing 🙂