The emerging influencer market in Australia is attracting a bigger share of media agency attention, according to industry insiders.
Rapid growth in the sector has meant it's increasingly seen as a dependable marketing channel for brands - and one that's driving results.
The collaborations between influencers and brands is giving marketers more confidence to invest; building awareness, consideration and conversion for audiences.
Max Thorley, national head of social and influencer marketing, GroupM Nexus, ANZ, said when people look at the size of the influencer market, they do themselves and their brands a disservice by not considering the larger cohort of emerging talent and willing digital contributors to brands.
“There are 6 million Australians who consider themselves creators; of them, an incredibly large portion (19%) consider themselves influencers,” said Thorley.
There is no current monitor in place for ad spend into influencer marketing in the Australian market.
Sam Kelly (pictured right), managing director at Hello Social, has indicated the levels of spend are growing year-over-year, noting an uplift in spend into the category as it is certainly in growth phase.
"Across our externals, influencer spend accounted for 21% of total social media advertising spend in FY 21-22," said Kelly.
"Over the last two financial years we've seen a 480% increase in influencer investment."
Estimates suggest that the global influencer marketing sector is expected to grow to US$24.1 billion by 2025 from US$6 billion in 2020, according to a report on social media services by competition watchdog ACCC.
That ACC report - and accompanying investigation - found a number of issues currently facing the influencer space, including:
- Uneven remuneration: There is a broader lack of understanding and consensus about the standards for determining pay rates in marketing arrangements between influencers and brands.
- Online harassment: Influencers are often public figures, and as such can face high rates of online harassment and bullying.
- Child influencers: Who may be susceptible to greater harms online, including via online harassment, privacy breaches and a lack of labour protections.
And the ACCC concluded that "the disclosure of sponsored posts by influencers needs to be improved".
The evolution of the market has meant a shift in ad spend, media agencies, business growth and results for advertisers and brands alike.
Influencers are playing an increasingly significant role in the Australian media mix, and the growth of the creator cohort is taking the advertising industry in a new direction.
The current state of the market
Industry experts in this particular market recognise how influencers can provide unique benefits they can offer brands in terms of reaching and engaging with target audiences.
“A survey conducted by Socialbakers in 2021 found that 70% of marketers in Australia reported using influencer marketing in their overall marketing strategy,” said Howard.
“In comparison to other marketing channels, it's important to note that influencer marketing should be seen as a complementary strategy rather than a replacement for other channels.
“Brands in Australia continue to utilise a range of media channels, however, influencer marketing offers a unique advantage in terms of its ability to leverage the credibility and influence of trusted individuals to promote products or services in an authentic and engaging way.”
Shivani Maharaj, chief content & partnerships officer at Wavemaker, works closely in the influencer space and has noted how influencers are changing the media landscape.
“Influencer marketing is a fast-growing channel, with TikTok creators accelerating growth in this space. Creators are the gateway into the metaverse and Web 3.0,” said Maharaj.
“It's also important to note that Australia punches above its weight when it comes to influencers and creators.”
Media agencies and influencers
Media agencies in Australia are recognising the value of influencer marketing, with many offering specialised influencer marketing services to their clients, says Howard.
“Media agencies are providing their clients with specialised services to help them navigate this complex landscape and achieve the greatest impact with their campaigns,” she said.
For a media agency such as Wavemaker, Maharaj (pictured right) said all types of influencer campaigns can deliver results for brands, especially when connecting influencer/creator marketing to other channels and the wider campaign.
“Influencer marketing can play an important role across the purchase funnel,” said Maharaj.
“81% of consumers prefer being served content from creators VS brands. Influencer ads deliver 44% higher attention metrics vs. brand ad content.
“63% of audiences trust what influencers sav about brands much more than what brands say about themselves in their advertising.”
Results for advertisers and brands
Thorley believes the influencer market is a dependable and growing marketing channels for brands and advertisers.
Growing budgets have been dedicated as a result of influencers forming a central role in a brand’s overall marketing strategy.
“We’ve seen a key perception shift in a lot of our leading brands who view influencers as a channel, rather than a one-off activation tactic. That indicates both increased market maturity, but also a level of respect from marketers who have seen the positive results and want to scale it,” said Thorley.
Sharyn Smith (pictured right), CEO and founder of influencer marketing company, Social Soup, said the market is getting results for advertising when brands are looking to do things differently and looking to ROI.
“We’ve known for a long time that what people say about your brand has more impact than any advertising a brand can do,” said Smith.
“We are entering a phase where businesses are prepared to invest in influence and at The Influence Group we are building out some pretty exciting people-based strategies to really change the game.”
Kristina Farkas, founder and director of She Wolf Agency, said her agency continues to grow as brands invest more spend into influencer marketing.
“Whilst sometimes influencer marketing can be difficult to track performance of, it is an essential touch point in the overall marketing strategy,” said Farkas.
For the influencer and marketing agency, the industry has helped build that awareness.
“I feel it’s quite an important element all brands should seriously consider in their marketing plan and budget. Influencer marketing is a new and modernised form of PR, and it’s here to stay.”
How do we know the market is growing?
According to founders and directors in the talent industry, the market is growing as a result of the increase in user-generated content creators and the rise in digital talent agencies.
Jordan Michaelides (pictured right), managing director at ecommerce creative comms agency Neuralle, said the business of Neuralle was born out of influencers and attention based activity.
“When it comes to the digital space there's been multiple iterations. Gen Day from Day Management being one of the first in this domain and Clair Winterbourne from Born Bred is really making her mark,” said Michaelides.
“We think that with the change there will be specialisation and growth in this segment.”
Smith from Social Soup says the influencer work carries a new weight where it warrants going through a competitive process to seek the right specialist partner.
“It’s the way in which we are being involved in competitive pitches -rather than just giving it to one of the existing agencies on the roster i.e., media or PR,” said Smith.
“From an industry perspective, we know it is growing through market data internationally and locally we are continuing to see more agencies and specialists join the AiMCO membership base,”
Thorley said that perhaps the greatest non-financial indicator of growth in the market is participation.
“This mass desire to participate is a clear sign of growth, both in terms of investment and desirability. We have a network of 68,000 influencers who are relevant to the market and allows us to provide incredibly detailed responses to briefs for clients,” he said.
Conversely, marketers are also looking to achieve different results from their activity, says Thorley.
“A brand isn’t always looking for the biggest name celebrity influencer with the largest following, they are increasingly concerned with finding the right person that represents their brand authentically,” he said.
“This is where we see a rise in opportunities for micro, and macro influencers.”
How are influencers developing their brands?
Michaelides said TikTok has been the fastest growing area for influencers to grow their brand, as well as Youtube Shorts; a dark horse in the space.
“There was a boom for the last two years in the talent-hosted podcast space led by Spotify, iHeart and a few others, but that has petered off,” said Michaelides.
“Post-COVID, like a lot of digital-first brands, we're seeing greater emphasis on ‘brick and mortar’ activities like talent doing live events (see our comedy talent and people like Abby Chatfield touring via Frontier Touring), in-store events, books, etc.”
As brands start to invest more spend into influencer marketing and more people are joining the content creator space themselves, there will continue to be growth in opportunties for creators, says Farkas.
"While sometimes influencer marketing can be difficult to track performance of, it is an essential touch point in the overall marketing strategy,” said Farkas.
“It’s an important element all brands should seriously consider in their marketing plan and budget. Influencer marketing is a new and modernised form of PR, and it’s here to stay.”
What does a good influencer campaign cost?
Industry insiders say it can be difficult to put a number on campaign costs. They tend to place their focus on investing in the right strategists, planners and brand marketers who understand how influencers can complement a brand.
Maharaj said advertisers need to commit a reasonable spend to test the channel effectively.
“For some brands, $200,000 may be effective to test some creators and amplification together. For others doing performance, it may be millions as they’re seeing results,” said Maharaj.
Those working in the influencer market advise brands to not just look at the cost of influencers when it comes to budgets; first and foremost is ensuring sufficient reach in the channel.
“Each social platform has specific amplification products for influencer/creator creative - Branded Content ads with META; Spark Ads with TikTok and even Pin Ads with Pinterest,” said Maharaj.
Kelly from Hello Social said social platforms are closely monitoring the increase in direct influencer spends over platform ad spend.
"It has presented a challenge for them: they understand the need for creators to be on their channels publishing and bringing in audiences, however, we know they are looking at commercial models as brands paying talent directly is circumventing direct social ad spend," he said.
According to Kelly, organic reach continues to drop and brands now not only need to engage an influencer, but they also need to back their content with ad spend.
"This play would essentially see the influencer only eating away at creative and production budget not platform spend. The platforms need to create a world where influencers and their own revenue can grow in harmony," said Kelly.
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