Spotlight on Influencer Marketing Fraud and How to Protect Your Program

Oct 13, 2020

Marketing Coordinator APAC

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In recent years, influencer marketing has become a marketing plan staple for businesses of all sizes. Influencers reach literally billions of people every month, and are a remarkably important source of information and recommendations, especially for younger audiences.

As social media apps like Instagram and TikTok become central to popular culture and with each’s average monthly users exceeding 1 billion, marketers are quickly recognizing the value in reaching these users through influencer partnerships. In fact, in the United States, influencer marketing spend is likely to reach $8B by 2022 and globally brands are expected to spend up to $15B.

The opportunity to drive perceptions and sales though influencers is immense. This is reflected in the rapid growth of this form of marketing — increasing at least 50% each year.

It’s easy to understand why; with influencer marketing has proven to be a powerful way to raise brand awareness, engage with a niche audience, and drive sales.

 

What Does Influencer Marketing Fraud Look Like?

With increased influencer marketing investment comes a growing threat of fraud. Fraudulent influencers carry out disingenuous practices by manipulating social engagement metrics like followers, likes, comments, reach and so on. In many cases, software or bots will often be used to automatically generate these false social engagements.

While there are several forms of influencer fraud, the following are the most common:

1) a genuine influencer who buys social engagements 

2) a fraudulent account that impersonates or fabricates a real person/influencer

No brand wants to pay an influencer who, in fact, has no influence.  In addition to a lack of ROI, there is also potential to hurt brand reputation. Therefore, you want to ensure your efforts are focussed on legitimate influencer partnerships.

 

Understanding the True Impact of Influencer Marketing

One way to mitigate the impact of fraudulent activity on your influencer program is to have better transparency into the sales being driven by your influencer partners. Through improved tracking and measurement, you will be able to tie specific purchases and activity directly to each influencer partner. 

This can be achieved by providing each influencer partner with unique tracking codes and URLs for their programs. Whether your goal is to track conversions or identify other engagement and performance targets, smarter tracking and measurement will allow you to assess their true impact on your business.

 

Performance or Hybrid Compensation

To alleviate concerns surrounding influencers and fraud, consider moving your influencer marketing program onto a performance or hybrid compensation model.  If you are still using a flat-fee compensation model to pay influencers, it’s important to know that there may be better options. This model leaves you exposed to potentially fraudulent activity as influencers have incentive to inflate followers, reach and engagement numbers.

Partnership marketing software allows you to track, measure and compensate for your desired outcome, whether that is a sale or other metrics important to your business. This gives marketers the opportunity to look well beyond likes, comments and reach meaning you have the possibility to only pay out when an influencer has helped generate a sale. This gives you the tools at hand to not pay out on manipulated campaign metrics, and instead focus on those that contribute to your bottom line.

 

Integrate to Mitigate

Another benefit of using a partnership technology like Partnerize is the capability to integrate with third-party influencer marketing technology partners through direct API connections. This allows brands to combine sales performance measurement with traditional social metrics, closing the loop on reporting and providing a single source of truth.

When it comes to influencer marketing, traditional social metrics are, of course, still important. But, having insight into the impact on actual sales is invaluable. It helps marketers understand the influencers who drive real value for the business.  And it helps reveal low quality or low influencer partners that are wasting your money. 

 

Conclusion

As with any partnership, it’s important to look to form long-term and transparent relationships with your influencer partners. Thankfully there are many ways to achieve that through partnership technology. That said, fraudulent activity comes in many forms and has the potential to advance with the growth of this industry. Take some actionable steps around measurement, tracking and compensation in your program to ensure you work with legitimate and value-driving influencer partners going forward. 

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