European Influencer Marketing Landscape in Q4 2019

Influencer Marketing is a frenzy newborn eldorado that can be highly complicated to understand for brands and marketing agencies. As the efficiency of this branding or acquisition technique is no longer questioned, professionals are trying hard to decipher the 300+ players specificities and identify what are the best IM strategies for them. Pioneering this industry for 9 years with Kolsquare, I decided to share my analysis and vision of the European Influencer Marketing Landscape in Q4 2019.

I recently had the opportunity to attend the Influencer Marketing Show 2019 with my team @Kolsquare. It is the biggest European event gathering major continental and UK players in the IM industry, from IM agencies to platforms and third parties. Amazing energy during 2 days, with great people and projects that partly explain the stunning stamina of Influencer Marketing. A great opportunity for a leading European platform like Kolsquare to meet global brands and marketing agencies that are already activating influencers on their campaigns (or willing to) and better understand their needs. But also to share market insights with our pairs, partners and competitors.

At Kolsquare we have a customer centric approach with strong data driven mindset. And we know brands and agencies well. We have been pioneering the IM industry as I created Brand and Celebrities (Kolsquare’s mother company) in 2011, specialised in Celebrity Marketing with a data centric and automation approach. For the last 8 years, over 3000 brands has been using our platform to run more than 7000 campaigns worldwide. We have seen the IM market birth, and the gold rush that has followed. 

THE INFLUENCER MARKETING VALUE CHAIN

Running such a complex industry requires expertise at each stage of the value chain. 

Talent Management

There would be no industry without Talent. Some call them Creators, Content Creators. Digital Ambassadors. Media refers to Youtubers, Streamers, Instagramers, … at Kolsquare we use the acronym K.O.L (as Key Opinion Leaders), a true authentic and powerful individual with a captive audience on various social networks. But however you call them, KOL need to manage their business to regularly produce accurate and engaging content for their fans, and occasionally manage their collaborations with brands. This is what I call Talent Management.

Creation

Launching an efficient influencer marketing campaign requires the best strategy. Which social networks are best suited to reach my target and engage audience ? What is the creative idea that will trigger word of mouth and engagement ? What kind of KOL ? How to articulate the campaign ?

Activation

Once creative strategy is setup, activation is the execution of the plan. You have to define the list of KOL, reach them out, convince them, contract with them, pay them or ship them with the products, invite them to an event, manage logistic if required, … 

Catalog

How do you identify and contact the right suitable KOL ? You can already know some of them, or search directly on social networks, but it’s complicated to have an exhaustive and rational approach. Accessing a structured catalog is the most efficient approach.

Data

Identifying that a KOL is accurate for a brand or a campaign is key. You need to access a huge amount of data on content (text, photo, videos), engagements, but also on demographics (gender, age, localisation, interests …). The issue is the same when measuring the Return On Investment of a campaign. In IM industry, data is king.

Performance

As the industry is growing, measuring and increasing brands and KOL performance is critical.

CRM

Dealing with a large number of KOL for a large number of brands requires more than Excel sheets. That is where CRM features (or IRM for Influencer Relationship Management) solve numerous brands pains.

Social Listening

Once you have launched an influencer marketing campaign, you have the opportunity to analyse the long tail impact by screening the overall social media, measure and analyse it. This is social listening.

EUROPEAN INFLUENCER MARKETING LANDSCAPE IN Q4 2019

European Influencer Marketing Landscape

Here is my analysis of the European competitive landscape in the Influencer Marketing industry in Q4 2019 (and feel free to comment so that I can improve the matrix). 

On the extremities of the value chain you have two strategic groups that have been paving the way of this industry for years : Multi-Chanel Networks (or MCN, or Studios) and Social Listeners.

  • MCN manage talent, I would say « the old fashion way », like a 2.0 digitalised Jerry McGuire would do. They deal exclusivity deals with high end KOL (historically mainly Youtubers). They humanly manage a limited number of talents, and sale IM campaigns to brands and agencies, promoting synergies between their roaster talents. Tech and automation is very peripheral for those players. They usually charge brands with very high margins, and try to place their talents within campaigns even if they do not perfectly fit with brands needs.
  • On the other end, Social Listeners are strong established players that heavily rely on tech (usually with a SaaS model). They have access to massive and very detailed data on almost all existing social networks in the world, and they are on paper complementary to other players in the value chain. Most of them recently tried to sell their social listening tools for IM purposes. Those tools are very powerful, but most of the time not accurate for the specific need of KOL discovery and activation.

Low entry barriers players are IM agencies. They are focused on strategy, creativity and campaign production (including organizing shootings, events, producing leaflets,…). They work based on brand’s briefs, for one-time or yearly campaigns. They usually work with a limited number of trusted KOL that they regularly onboard on their campaigns. Some of them developed in-house platforms to optimise operations, and sometimes goes up to giving an access to their customers. They are in competition with « traditional » agencies, whether PR, 360 or Media agencies. IM agencies are not scalable. 

Medium entry barriers players are Activation Platforms (like Kolsquare) and IRM Platforms :

Activation Platforms are at the heart of the IM Industry. They provide brands and agencies with online discovery tools (with a limited or exhaustive catalog), and all the tools they need to contact and contract with KOL, as well as monitoring their campaign performance (what we call the 3M at Kolsquare: Match, Manage and Measure). Within this group, there are 3 subcategories : 

  • 1- the « Seeding Platforms » are focused on non transactional partnerships, very close to PR issues (brand send generally low value products to micro influencers in exchange for content). Using Seeding platforms usually don’t allow brands to access a catalog of influencers but rather to post a project that will be shared with influencers within the platform’s network, allowing them to submit to the campaign if they want to. Data are usually not their first concern.
  • 2- « All-in-one Platforms » (like Kolsquare.com) provide their users with all the Match, Manage and Measure features, based on an exhaustive catalog of KOL worldwide on several social networks (usually Instagram, Facebook and Youtube, and for the most advanced on Twitter, TikTok or even other social networks). Those players are totally data centric.
  • 3- the « Limited Social Network focus Platforms » are generally offering the same features as « All-in-one Platforms », but focused on only 1 social network (Instagram mainly). 

IRM Platforms work like a CRM but for Influencer Marketing. Most of the Activation Platforms (see above) are providing IRM features in addition to discovery tools, but IRM Platforms focus on IRM features and mostly allow their users to upload their KOL contacts lists and manage relationship with them on the long term. Using such a platform should only allow you to access « your » influencers data and info, but some IRM Platforms extended their offers by providing KOL catalog in addition to their core business features.

And finally there are third parties:

Data Providers emerged from the other players’ needs to collect and provide accurate demographics data to their customers, and they specialised in this tech intensive field with an API business model. They usually focus on 1 social network (like Instagram) but are gradually extending their coverage. Most of the other players have their own data collecting and processing techniques, but most of them still rely on Data Providers for in depth data sourcing. 

Since 2018, several other third parties popped-up in the industry, that I call Tools Providers, trying to provide other players with technologies that would solve specific pains: contracts automation between KOL and brands (like the platform Ekkla.io that Kolsquare acquired in 2019), audience quality certification, media kits for KOL, … all those markets are very niche but confirm that the IM industry is shifting towards a new stage of maturity.

Are you still there ? 🙂

INFLUENCER MARKETING MARKET EVOLUTION

European Influencer Marketing Landscape

Things are moving fast and groups of players are already evolving.

MCN / Studios as well as IM Agencies already understood that their model was not scalable, they thus launched a race to tech (and SaaS business model), either on developing their own inhouse solutions, or on acquiring already existing platforms. 

Social Listeners are on a mature market and all players identified influencer marketing as a new business opportunity. They almost all launched their own IM Activation Platform, inhouse or through partnerships. Some of them acquired small size IM Activation Plateforms to accelerate their time to market. 

Some Data Providers tried to launch discovery tools, but it is a tricky positioning for them as they are suppliers of the main Activation Platforms and thus would become direct competitors (in an already crowded market). 

Finally, Activation Platforms and IRM Platforms are also moving on the value chain, covering a broader range of brands needs in term of added value or KOL typology.

We can obviously see on this matrix that Activation Platforms are in the very middle of the “Game of Thrones” that is occuring in the market. How can we explain that ?

WHAT’S NEXT IN THE INFLUENCER MARKETING INDUSTRY FOR 2020?

European Influencer Marketing Landscape

Activation is key in the IM industry because it is where media buying is located. This is where brands pay influencers for their creative content and sharing to their communities. There is room for all kind of players in a $10B industry 2020. But activation is where money is, and we believe at Kolsquare that main expansion success stories in 2020 will come from Activation Platforms.

I would be pleased to provide you with more details about this analysis of the European Influencer Marketing Market for Q4 2019, as well as about our specific approach @ kolsquare.com !

About Kolsquare :

Kolsquare is the first one stop shop influencer marketing solution, a leading player in Europe with Headquarter in France (Paris). To help professionals optimize their Marketing Influence campaigns from A to Z, we have built Kolsquare, a complete solution based on the latest updates of Big Data, AI and Machine Learning technologies. From the personalized support of brands to the handling of our product, we enable you to effectively address the new challenges of digital marketing. Among our customers: Uber, Coca-Cola, Cheerz, Clarins, Sketchers, Shiseido, Birchbox, P&G, N26, … more on kolsquare.com

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