Marketing has seen a lot of intense changes over the years. As we move forward, the days of print ads and TV commercials have become a thing of the past. Marketing now lives online, and it’s mostly delivered by creators and influencers.
You might think creators and influencers are the same thing. After all, influencers create content for their audiences, don’t they?
Of course, they do, but influencers and creators are vastly different. If you want to create a powerful and effective marketing campaign, you’ll need to understand how these two roles differ and how you can measure their effectiveness in the form of ROI.
Your ROI, or return on investment, is the measurement of the success or failure of any venture. But calculating ROI for creator and influencer marketing can be tricky. That’s why we created this guide. We’ll walk you through the differences between creators and influencers before showing how you can calculate their ROIs.
Table of Contents
- What is a creator?
- What is influencer marketing?
- How can you calculate ROI for creator marketing and influencer marketing?
- Keyhole helps you track creator and influencer marketing
- Final words
- Frequently Asked Questions
What is a creator?
A creator is someone who creates content for you. They develop and deliver content for your marketing campaigns. This can encompass various mediums, including videos, photos, vector images, blog content, and landing pages.
As the name suggests, a creator creates. That’s what they’ve dedicated their careers to. They’re not directly influencing the habits of others the way an influencer might. Instead, they’re contributing media that can be promoted and targeted to a specific audience.
For example, suppose you’re selling a fitness program. In that case, you might hire a creator to develop an infographic with statistics about the dangers of obesity and how people have turned their lives around by embracing a more fitness-oriented lifestyle. That infographic can be shared on social media platforms and posted to blogs as a valuable resource.
Additionally, a creator might make an informational video to educate people about the health issues they may face if they neglect fitness goals. That video can then position your fitness program as a solution to the problem. It’s not directly marketing your company. Instead, it’s offering a solution backed by statistics and facts.
This content is designed to educate and not to influence. The buyer is then able to make their own decision.
What is influencer marketing?
An influencer is a person with a large social media following who uses their celebrity status to influence the buying decisions of others. An influencer creates content but can’t be considered a creator because their ultimate goal is to sell, not inform. As shown in the image below, influencer marketing has been a growing industry for many years.
While a creator might focus on the awareness and interest stages of the sales funnel, an influencer seeks to influence buying decisions and close sales directly.
An influencer is often paid a percentage of the business they bring in for a company. This is usually done through a trackable sales link or promo code that automatically pays a commission. Other more popular influencers will want to receive money for their endorsements up front.
So, who are influencers? They can be any influential person with a large following, which includes:
- TikTok viral stars
- Popular social media users
Referring back to our fitness system example, an influencer would try out the system and then make posts on social media that both tell followers their thoughts and show their results. By seeing tangible results and getting a recommendation from a trusted source, people will be more likely to trust your fitness system and purchase it.
The important thing to remember when choosing an influencer to work with is that they should be someone with an audience that overlaps with yours. They need to reach people who can use your product or service meaningfully.
Thus, you need to focus on the right type of influencers. For example, if you have a tech business, you need to find tech influencers to help you. Marques Brownlee, for example, is one of the most popular tech influencers on Instagram and YouTube with over four million followers.
How can you calculate ROI for creator marketing and influencer marketing?
Now that you understand the difference between creators and influencers, it’s time to determine how we can calculate the ROI for marketing campaigns based on these individuals. Here are four steps you can take to better understand the ROI of creator marketing and influencer marketing.
1. Set your goals
Before embarking on a creator or influencer marketing campaign, you must first outline what you’re trying to accomplish. What does success look like for you? That’s also the first step in determining your ROI. You need to measure your results against these original goals to determine whether your partnerships succeeded or failed.
These goals should be outlined in a document so they can be referenced later. Is this a campaign focused on awareness of your company? Are you looking to get subscribers for your newsletter or podcast? Or are you trying to drive actual sales and generate profits?
2. Determine your KPIs
Now that you understand your goals, it’s time to figure out your key performance indicators, or KPIs.
These are the metrics you’re going to track as the campaign progresses. Make sure they’re written down in the same document as your goals. Next to each KPI, discuss how this metric contributes to the goals you set up earlier.
Here are a few KPIs you may want to track:
- Conversions – You should be tracking sales coming in as a result of your marketing campaigns with sales automation tools to reduce the risks of human error. Track both your overall sales and any that have come through an influencer link or promo code.
- Impressions – How many people have seen your posts and content since you started working with creators and influencers? If you’re reaching out to new people unfamiliar with your services, they might not want to buy immediately. But an increase in pageviews can show that people are finding you through creators and influencers. If there’s a barrier to purchasing after that, then there might be something wrong with the customer experience on your site.
- Social media engagement – How many people interact with influencer posts and creator content on social media? Do you see a lot of likes and comments? How about TikTok engagement? What are people commenting on? Engagement is a surefire sign that people are paying attention.
- Your subscribers and followers – Do people follow your social media accounts or subscribe to your newsletter due to these campaigns? This kind of engagement could be an important step on the customer journey and shouldn’t be overlooked when examining the results of your creator and influencer marketing. Using a social media monitoring tool, you can track your followers and your engagement levels.
3. Measure costs
Now, we need to look at what the creator and influencer campaigns you’re running actually cost. There are many costs associated with a marketing campaign, and this is where the investment in “return on investment” comes into play.
Some of the costs you might incur when embarking on these campaigns include:
- Creator fees – This is the money you pay creators to develop content for you. Creators rarely work on a commission system and often require payment upon completion.
- Influencer fees – Some more popular influencers will want payment upfront for their services. If you’re working with someone who demands such a condition, you’ll need to factor in what you’re paying them and measure that against results.
- Influencer commissions – Track the money you’re paying to influencers through sales made through their links and promo codes. You may find in the future that the percentage you’re offering is eating into your profits too much, and an adjustment might need to be made for future influencer partnerships.
- Free products – You’ll need to provide your influencers with free products to try out and use in their posts. The cost of these products must be factored into the overall cost of the campaign.
- Online services – Any alterations to your website to ensure that it works with the influencer or creator campaigns should be accounted for. This includes landing page creation, security services like a web application firewall, and the cost of running automation software that keeps track of influencer commissions and promo codes.
4. Compile the data and calculate
Once you’ve compiled your data, it’s time to calculate your ROI. How you do this will depend on the goals you outlined at the beginning of this process.
A campaign designed to increase sales is the most straightforward to track. You simply compare the amount of money you put out against the amount you made through the campaign to determine your return and whether it falls into an acceptable range.
With impressions or engagements, it gets a bit trickier.
You can divide your costs by the impressions you generated, then multiply that figure by 1,000. That’ll give you your cost per 1,000 impressions, also known as CPM or cost per mile. You’ll also need to know how many impressions it typically takes to generate revenue.
For example, if you get 10,000 impressions and see 1,000 conversions, you can safely assume that 10% of your conversions can be translated into actual dollars. Armed with that information, you can calculate whether your cost per mile is too high and how much profit you’re making.
Keyhole helps you track creator and influencer marketing
Regardless of whether you opt for creator or influencer marketing for your future social media marketing initiatives, you’ll need to be able to track key social analytics if you want to gauge how you’re doing and decide where your plans might need to change.
The business analytics benefits can be numerous, such as improved decision-making, increased efficiency, and enhanced understanding of customer behavior.
Keyhole is a platform that can help you do that. It simplifies the data compilation process with custom reporting and automatic data tracking. Using our analytic solution, you can track multiple profiles, brand mentions, influencer activity, and marketing campaigns in a simplified, easy-to-understand way.
Creator marketing and influencer marketing are often lumped together, but the only thing they really have in common is that they’re vital pieces of the modern marketing puzzle. By understanding the difference between these marketing ventures and analyzing their return on investment, you can make the best of your campaigns and translate these efforts into real profits.
If you want to track the results of your creator or influencer marketing campaigns, sign up for a free trial of Keyhole today.
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Frequently Asked Questions
1. What’s the difference between a creator and an influencer?
Influencers are online personalities who influence their followers' buying or personal habits. This could include recommendations on how to dress, what software to purchase, which games to play, and any other purchase decision, big or small.
A creator is someone who creates original content that promotes audience engagement. This content could be educational in nature, like infographics and how-to guides, or it could be for entertainment purposes, like a game streamer or movie reviewer.
2. Are influencers creators?
Yes, most influencers can be considered creators as long as they create original content. This can include video reviews of the products they pitch, blog posts, or edited images illustrating whatever they’re promoting.
3. How many followers do you need to be an influencer?
There are different levels of influencers. According to Forbes, bigger isn’t always better. Micro-influencers have audiences between 10,000 and 50,000 subscribers. Anything from 50,000 to 500,000 would be considered a mid-tier influencer. Those with 500,000 to 1 million subscribers are considered macro influencers. Anyone with over 1 million subscribers is a mega-influencer.