Post rationalisation in social media

BPG Cohn & Wolfe’s Taghreed Oraibi says it’s time to formalise how influencer campaigns are run and paid for.

The growing impact of social media influencers is a topic making headlines in the UAE media and has generated growing debate among the broader communication industry.

In our rapidly evolving digital world, social media influencers have established themselves as a gateway to content specific audiences in the thousands – and frequently millions. Their direct engagement and relationship with target audiences can be valuable resources for brands that are proactive about advancing relationships and connecting more closely and directly with their customer base.

But as their influence grows, so does their commercial power and impact. And that means that companies need to consider large investments to have these influencers support their brands.

That also means more discussion about the need for a more regulated approach to these influencers to put processes and systems in place to formalise partnerships.

Brands are now partnering with social media influencers more than ever before, and in the past few years, we have seen ‘influencer engagement’ become part of every communication strategy. Budgets are naturally increasing to embrace the costs of influencers, who now regularly charge between $1,500-5,000, with some charging up to $10,000 for a single Instagram post.

So why do they charge? Well, there are many expenses that social media personalities incur while developing a campaign for a brand. The time and effort invested in content development, photography and travelling needs to be accounted for and will be used to determine a fee.

However it does appear that in many circumstances the level of compensation for an individual influencer will be determined purely based on personal assessments, due to the lack of common, established industry rates or regulatory frameworks.

If we take a closer look at the typical roles in the communications industry such as editors, translators, content creators, production departments and so on, each of them will have a set of industry rates that are commonly recognised.

But given the relatively new phenomenon of social media influencers, clear guidelines or regulations to determine the rates are currently absent, which handicaps the ability of brands to budget efficiently for an influencer campaign.

So the question is, will this phenomenon of payper-post push brands away? And will the significant shift from genuine and unbiased content to commercial brand endorsement by social media personalities result in unsatisfied and suspicious consumers in the future?

Transparency between brands, influencers and consumers is essential. Brands should be able to set clear key performance indicators and set agreed returns on investment for their influencer engagement campaigns.

These rates should be set based on clearly defined outputs and outcomes such as cost per engagement, acquisition, or click, instead of a fixed rate per post.

In addition, influencers have to be transparent and disclose these brand partnerships with their followers.

Setting certain parameters to the formation of these brand-influencer-consumer relationships would enable brands to execute successful campaigns and allow consumers to make well-informed decisions about the products and services they view on social media.

In the past few months, the Federal Trade Commission in the UAE has issued endorsement guides to celebrities and influencers pertaining to social media posts.

In the UAE there are currently no regulations in place that encourage influencers to be transparent about the details of their partnerships and fees. However it seems essential that in the future, key industry decision makers and communication agencies cooperate with government entities such as the National Media Council, the Consumer Protection Division of the Dubai Economic Department and the Telecommunications Regulatory Authority to develop guidelines that can regulate responsible endorsements to consumers through social media influencers.

These guidelines should be structured to include disclosure of sponsored messages on social media, and develop standardised rates for influencer collaborations.

Social media influencers are providing content for a large number of online users worldwide and there is no doubt that they are increasingly influencing consumers’ purchasing decisions. According to a study conducted by BPG Cohn & Wolfe and YouGov, more than 70 per cent of UAE residents in the age group of 18-40 are happy to take advice from social media influencers before purchasing a product.

Having industry guidelines in place for transparent disclosure of sponsored messages and regulating influencers’ fees will provide more opportunity for equally constructive brand-influencer partnerships and a well-informed consumer.

So as a first step, and in the absence of industry regulations, brands, marketers and agencies should make better decisions on how to compensate social media personalities during a campaign.

Paying influencers for the outcome and performance of their content, instead of the current focus on outputs, should become a standard practice to encourage their commitment to a brand campaign’s success. But this should be clear and transparent, which means encouraging the disclosure of sponsored content through hashtags such as #Sponsored or #Ad, or disclosure statements.