London-based influencer marketing and influencer management agency Summer Managing Director Mischa Joslin outlines key trends driving growth in the UK’s influencer marketing industry.
Flush with creators and awash with agencies, advertisers in Britain are expected to spend a whopping £930M ($US1.17bn) on influencer marketing in 2024. But with big bucks come big challenges, as marketers jostle to stay ahead of the trends and capitalise on the immense opportunity of Europe’s most dynamic influencer market. In this interview, London-based influencer marketing and talent agency Summer Managing Director Mischa Joslin outlines the key trends in the UK market for the year ahead.
At a macro level, we're obviously seeing huge industry growth. On a day-to-day level, there’s a shift with how clients are allocating their budgets. Where once it would have been carved up between traditional advertising, TV, out-of-home, PR, social, and influencer, they're definitely now looking to down weight in certain areas and upweight influencers.
There's a few things driving growth. The shift in consumer behaviour; social media usage generally for all audiences is skyrocketing and brands realise they need to show up where their consumers are. Influencer marketing is a great way to get in front of their audience on channels they're consuming day in, day out, for many hours.
The understanding of the ROI on influencer marketing has definitely shifted. Agencies have focused a lot more on showing ROI and making brands understand the role influencer marketing can play in helping to drive everything from awareness to sales, rather than it being just top of funnel. Brands are also realising that, with the right strategy, influencer marketing can be quite a cost-effective way of getting results.
There is also a shift in how brands are selling that is driving growth because so many now are retailing through purely e-commerce, but also through TikTok Shop.
We were seeing a huge shift where they were bringing a lot in-house, and that sometimes was a misconception of how easy it is. Brands thought: ‘We can hire someone with two years’ experience and they'll replace an agency’. But what we see now is a huge amount of redundancies and layoffs. There's almost a shift back to using agency, but there definitely was a big shift to bringing it in-house and validating how important influencer marketing was.
We're finding brands are cutting their marketing budget overall, but they're also getting more savvy with how they spend it. A lot of brands might have less money, but they're also putting more into influencer because they think it can deliver the ROI where once they were required to do a TV advert.
There is a shift with more brands doing influencer projects as opposed to always-on activation. Where they once had half a million to spend, they now only have £100K and they'd rather do one big activation. In some ways the inflationary issue is benefiting influencer marketing because it's helping brands to find ways that are more savvy to spend their money. What influencer marketing can offer that many forms of marketing can’t is a tailored, dedicated audience; we know exactly who we're speaking to, who we're reaching, and that's going to give you more ROI for every pound spent.
Influence Responsable
I think it's still to come. There's so many agencies and it's highly competitive. The demand for influencer marketing has meant that a lot of PR agencies, SEO agencies, digital agencies, have all created a team within the business as an add-on. There will be a saturation point where brands go back to influencer specific agencies.
There will be a lot of agencies that start to go more niche and home in on a specific platform, or become dedicated to micro-influencers or one form of influencer marketing to capitalise on doing something really well, rather than being a jack of all trades.
It's really hard because the market is saturated with creators. It's become a career path a lot of younger people want to take. Brands are shifting strategy and wanting to work with creators that genuinely love their product, and who are authentic fans. Creators need to show they are genuinely passionate about a brand before they'll invest in them. That means the creator is not going to get an immediate pay check. They need to build that relationship organically and then grow. But that is the way it should be. A lot of creators really want those longer term brand deals and that's quite hard to get at the moment.
There is a shift in terms of reward where it always used to be a one-off payment. There’s definitely more negotiation in terms of commissions and sales, partnerships that are more collaborations. It’s less secure for creators in that respect, but there's also opportunities if you think you can drive impact.
It's grown because of the rise of things like Tik Tok Shop, there are more options to sell, and the format is more sales driven. There's still a big chunk that is pure payment. A lot of creators don't want to work on that basis, they'll do part payment, part revenue. It's probably around 25%. Micros especially are getting approached a lot more with the revenue option, because they can drive more in sales than they would get as a one-off fee.
It's working, but for certain sectors and certain types of products, like beauty. It works well for cheaper fast fashion. Anything premium or luxury is very reluctant to be involved because of the format and the way it's delivered, it’s got that TV shopping feel. In terms of consumer behaviour, the ease of purchase without having to go to a website is something they absolutely love. Especially for lower priced beauty and fashion and accessories, it is working really well and creators can drive significant impact in that way. But it has quite a specific vibe.
It's definitely made creators more careful and consumers are more aware of it, they call them out more now. Creators are all very nervous which has limited the amount they share beyond their contracted scope. In the past, if they loved the brand, loved the product, they would likely keep posting and mention it ongoing. But because of the ASA rules, they still have to declare anything like that as an ad, even though it's not in the scope of the contract. So I guess you're getting a little bit less for your budget than you would have previously.
Brands are definitely tightening up legally. Where it may have been a bit loose on the contracting side in some cases, now people leave no holes. The bit that gets confusing is when creators have their own brands, it’s still very muddy about whether they do or don't declare it. For an entrepreneur who's also an influencer, it's quite confusing. The ASA will probably bring in more regulations around that.
There’s a real surge around influencer content being used for SEO. TikTok is now the search engine of choice for a lot of people, and TikTok videos are ranking on Google. That's going to impact social content generally. We've just launched a new service called React, where we monitor search engine trends, and when we see spikes in certain search terms, we work with an influencer to create content that reacts specifically to that search term. It’s helping clients with their SEO, but on a different platform. Traditionally where they might have run Google Ads, they're now creating influencer content that answers that product question.
Kolsquare is Europe’s leading Influencer Marketing platform, a data-driven solution that allows brands to scale their KOL Marketing strategies and implement authentic partnerships with KOLs (Key Opinion Leaders). Kolsquare’s technology enables marketing professionals to easily identify the best Content Creators profiles by filtering their content and audience, and to build and manage their campaigns from A to Z, including measuring results and benchmarking performance against competitors. Kolsquare has built the largest community of influencer marketing experts in the world, and offers hundreds of customers (Coca-Cola, Netflix, Sony Music, Publicis, Sézane, Sephora, El Corte Inglés, Lacoste, …) the latest Big Data, AI and Machine Learning technologies to drive inspiring partnerships, tapping into an exhaustive network covering 100% of KOLs with more than 5,000 followers in 180 countries on Instagram, TikTok, Twitter, Facebook and YouTube. As a Benefit Company, Kolsquare has been pioneering Responsible Influence by championing transparency, ethical practices, and meaningful collaborations to inspire change.
