Buying Influence To Boost Sales Can Be A Solid Strategy For Natural Food Brands
http://www.forbes.com/sites/kateharrison/2016/10/20/buying-influence-to-boost-sales-can-be-a-solid-strategy-for-natural-food-brands/#ba030f254ae0
OCT 20, 2016, Kate Harrison
Walk through BJs or Wholefoods on a Saturday morning, and you will see dozens of people sampling everything from frozen pot stickers to baby food squeeze pouches. In-store demos are great for consumers, but setting them up is costly for companies. When it comes to smaller brands launching new products, the cost of customer acquisition through this model can be prohibitive.
As a result, savvy businesses are looking for new ways to connect with their target demographic, and buying influence is one option gaining popularity. According to Gil Eyal, Founder and CEO of HYPR, a company that “allows you to target and make educated decisions in the influencer marketing and celebrity endorsement space,” picking the right influencers can make all the difference to a product launch. When done correctly, buying influence can significantly lower customer acquisition costs.
Eyal points to one of their clients, Koa Organic Beverages, as a great example of how influence can work well. Through HYPR, Koa chose 10 Yoga Brand Ambassadors — and increased online sales by 500%. Here’s how they did it.
Koa’s Mission:
Koa is a beverage that is trying to lead the fight against the growing sugar epidemic and nutritional deficiency in the US. They wanted to engage with health conscious consumers — and their targeting goes way past standard demographics into lifestyle choices and affinities for specific activities, such as yoga. What they were looking for were thought leaders within the health and wellness space.
Koa’s Marketing:
Adam J. Louras explains traditional in-store demo economics. “In the beverage space, we are trying to educate consumers about our product. The generally recognized method for education in the industry is through “In store Demos”. This is where a third party, often a store employee or a company employee hands out a sample of the product in the store, and then engages a consumer with a specific message. The nationwide average cost of such a demo is approximately $200 for four hours. We estimate that an average Brand Ambassador can sample and educate up to 100 people during the demo. So, the cost per consumer at a demo is about $2.”
The Influencer Alternative:
Koa didn’t want to spend a lot of money and they wanted to see real actionable results from the marketing they did choose. They used the HYPR platform to identify 20 yoga professionals who have reached near-celebrity status in their local communities. Each “influencer” with a following ranging from 5K to 200K monthly viewers was given a sample of Koa to try. Koa requested a social media post only if they truly loved the product. In addition, they requested that the instructor hand out the product to their students who were interested in learning more about it. They briefed the influencers about the benefits and uniqueness of the product so they could correctly educate their students and fans.
The Numbers:
As Louras explains, “When we used the HYPR data to pare down the list of Yoga Professionals for our influencer campaign, we selected a group that had a total average cost per engagement that was close to the in-store scenario described above — just over $250. This is where it gets more difficult to compare, but here are the two ways we think about it:
- If we use the HYPR data to estimate the “Total Reach” and impressions of content to our target consumers, the average Cost Per Educated Consumer is around $0.04.
- If we use Engagement, i.e. the number of likes and comments, questions submitted to our website, etc., to gauge educated consumers, the cost is around $0.54.
So, the direct savings, assuming all else were equal, is probably somewhere between 3x-20x when compared with the $2.00 per customer unit from the in-store demo model.
The Results:
The initiative is still ongoing, but Koa has already seen great success. They saw search traffic for their product double on Google after the launch, and they’ve had a 20% increase in month-over-month page visits. For the month of May, when this project ran, they received 3x the number of product inquiries on their website and direct sales were up 10%.
Louras also notes: “The numbers don’t begin to quantify the intangible benefits that came from this process. If we have done our job selecting the ‘right’ influencer, then they should be raving fans of the product and will continue to educate other consumers going forward. We have already seen unsponsored content popping up on the internet where Koa just happens to make an appearance!”
The Summary:
For brands trying to gain traction on a limited budget, stepping outside the traditional sampling channels can make a big difference. In addition to the initial results, under a program like this one, the company has built relationships with key influencers, who have become genuine fans of the product. By continuing to build relationships with them and their personal fan bases, these companies can get results that far surpass random hand-outs on Saturday mornings.