Consumer packaged goods brands have a significant advantage over many other brands when it comes to measuring influencer marketing. After all, by their very definition, CPG products move off the shelf more quickly than durable goods with the result that sales lift is easier to measure and link to a particular marketing activity.
Let’s look at five ways CPG brands can measure the ROI of their influencer marketing dollars.
1. Track sales lift
Shopper marketing programs commonly track sales lift data from programs they run. Frequently, however, they run into problems where a series of tactics are run simultaneously and the sales lift can’t be attributed to any one tactic.
Perhaps the best way to reduce this problem is to build a few marketing programs in which only the tested tactic is used, or in which only the tested tactic is added to a commonly used formula. We recently ran a program for a CPG brand that supported the same BOGO promotion they’d run previously but with the simple addition of an influencer program.
The results were 200% higher than the promotion run without the influencer program. Consistent results like this can help determine the best use of budgets.
2. Share of voice
What happens when a brand can’t measure sales lift for whatever reason? One proxy metric is measuring online share of voice relative to a handful of competitors.
Research has shown that brands that achieve an outsized share of voice relative to their market share end up improving their market share over time. We’ve run more than 100 programs and have also found a very strong correlation between increased online share of voice and sales lift.
3. Equivalent media value
Another relative ROI metric that CPG brands should consider using is equivalent media value. While some people might question the value of an impression, we should all remember that advertising is based largely on generating impressions among people with a propensity to buy.
As marketers, we often have to make tough decisions on how best to apply limited budget. Influencer programs can be effective reach generators, so measuring how much the impressions would have cost if they’d been delivered via other vehicles can be helpful – particularly in showing the relative value of one marketing activity over another.
4. Content value
Unlike other types of advertising (wherein brands typically pay a publisher for space and a creative agency for content), influencer marketing includes the production and distribution in one budget. It’s easy for brand marketers to overlook this when evaluation time rolls around.
By calculating the value of the quality photography, videography and long form content generated, you have another variable to plug into the value equation. And don’t forget, the content generated in an influencer campaign is there to use and re-use in perpetuity – providing significant additional value for brands.
5. Cost per [blank]
Lastly, much of the marketing brands conduct today is measured either in CPM (cost per thousand impressions), CPE (cost per engagement) or CPC (cost per click). Influencer marketing can be evaluated the same way and compared to other marketing programs in which a brand might invest.
As brands increasingly fund influencer marketing programs, there are several ways they can be, and should be, evaluating these programs. In my experience, a well-run influencer program can be competitive with any other place a CPG brand might consider investing its marketing dollars.