The most successful social media influencers can have followings that exceed millions of fans on platforms like Instagram, YouTube, SnapChat, Twitter and Facebook, making them a dream come true for advertisers and brands. According to the influencer marketing agency Mediakix, advertisers could potentially spend more than $1.6 billion in advertising on just one social media platform—Instagram—in 2018 alone.
The site also predicts that “the influencer marketing industry will be a $5-$10 Billion Dollar market in the next 5 years.” These figures illustrate the profound importance of influencer marketing as a resource for advertisers moving forward.
Advertisers have turned to this type of marketing because it works. The principal reason for the effectiveness of influencer marketing is reflected in the following statistic from a report by TapInfluence; “92% of consumers turn to people they know for referrals above any other source.”
People like to get advice about products and services from those they know, and social media fans feel that they know the personalities that they follow because they see and interact with posts by these influencers every day. Consistency breeds familiarity, and in influencer marketing familiarity is key since it fosters trust.
Enter the blockchain. Trust is an essential part of the appeal of blockchain technology. Let’s explore why the trustless—that is to say, no trust required—ecosphere of the blockchain is the perfect venue for influencer marketing campaigns that are beneficial to advertisers, brands and content creators alike.
Influencer Marketing May Be the Way Forward, But How Can the Blockchain Make it Better?
The biggest challenges of influencer marketing are exactly the ones that blockchain technology most elegantly solves. One big issue faced by the influencers themselves is the need to generate income. How can influencers generate income while remaining true to themselves, their followers and their personal brand? One solution that content creators have turned to in order to earn income is sponsored content, which is simply when a brand pays the influencer to post content that features their product.
Unfortunately, this method of creating income can compromise the integrity of the influencer. What guidelines does the influencer use to decide what products he will sponsor and what products he will not? Financially, can he afford to turn down any sponsored content? Pondering these kinds of issues is not typically why the influencer got into the game in the first place. He just wants to post about subjects near to his heart, share them with his audience and form mutually beneficial relationships and connections with his fans. Too much sponsored content can make posts feel artificial and alienate those fans.
The problem of how to monetize an online presence is a pressing one. Here blockchain and crypto come to the rescue. The answer, according to Forbes, may be cryptocurrency. In a blockchain environment, social media fans use crypto tokens to “pay for quality content they choose.” This leaves more room for the influencer-created content that followers crave, and largely eliminates the need for the influencer to rely on sponsored content, injecting an authenticity into relationships between influencers and followers that can be missing on traditional social media platforms.
With tools like BOOSTO and MatchUpBox, communications, sales, and client relationships can be tracked, monitored and easily organized. In the influencer-driven blockchain environment, the influencer is also freed from the burden of having to hand over a substantial portion of his profits to conventional centralized platforms that charge big fees.
A primary issue for advertisers and brands that is virtually eliminated in the blockchain ecosystem is that of fraudulent followers. The transparency of a blockchain-based social media platform provides means by which advertisers can verify influencer statistics, and purchase tokens to access the audience data of any influencer on the platform. This is an important advantage since according to a recent report by Digiday, “A single day’s worth of posts tagged #sponsored or #ad on Instagram contained more than 50 percent fake engagement.”
In the same report, it was reported that “Bot comments are responsible for over 40 percent of total comments for more than 500 of 2,000 sponsored posts made each day.” The use of smart contracts in the blockchain environment effectively eliminates the problem of fraudulent followers since with this system identities are verified and transactions can only be completed once predetermined conditions have been met.
In order to choose the influencers that are the best fit to represent their brand, advertisers can check the demographics and metrics data of influencers on the blockchain platform they are using to more easily find their brand’s target audience.
Fans can safely purchase performance-based influencer services from the personal stores of their favorite influencers, and consult or communicate with them directly as a means of building a more genuine and fruitful relationship.
Influencer Marketing On Blockchain Is Inevitable
In the final analysis, we adopt new ways of doing things because they make our lives easier and better. In Clifford Stoll’s 1995 Newsweek article, Why the Web Won’t be Nirvana, he predicted that the internet will be a bust, and he lays out some pretty reasonable arguments supporting his case. “Lacking editors, reviewers or critics, the Internet has become a wasteland of unfiltered data. You don’t know what to ignore and what’s worth reading.” A fair enough assessment, but the internet has succeeded despite all intelligent arguments for why it shouldn’t simply because it fulfilled a pressing need.
This is exactly what will drive the adoption of blockchain technologies by marketers in the months and years to come. Decentralized technologies will come more and more into use because they streamline transactions, make all parties accountable and provide a secure, trustless environment for each and every stakeholder. These features will continue to transform influencer marketing, and the entire digital world.
Author: Heidi Yu is a serial entrepreneur, influencer marketing evangelist, and AI enthusiast. An MBA graduate from Seattle University, she successfully founded Boostinsider at the end of 2014. As one of the few women leaders in blockchain adaptation, Heidi founded BOOSTO.io, an influencer driven decentralized app store that returns power to creators and makers. Heidi speaks to audiences around the world about the adoption and the benefits of the blockchain.