Financial Marketing via Instagram Influencers Gaining Traction

Sometimes subtle, sometimes not-so-subtle, paid influencer marketing via social media keeps growing and Instagram increasingly is where it happens. Here are tips on how banks and credit unions can select influencers, understand why consumers choose an influencer to follow, and keep spending efficient.

Influencer marketing keeps on growing and as it grows, it keeps on evolving. In the relatively short time that influencer marketing has even been a recognizable trend, the ways it works for brands, what influencers do to make it happen, and where they prefer to do it have been shifting.

“It’s an increasingly saturated space, but its growth has not slowed,” said Jeannette Ornelas, Senior Digital Analyst at Comperemedia, a Mintel company. In a company webinar on the role of influencers in financial services marketing, Ornelas noted that the unique status of internet influencers seems to have permeated the consciousness of social media followers.

The idea of influencers actually covers a continuum. Social media has many major participants whose postings enjoy wide and influential followings, for example. Then there are people who are true celebrities — actors, musicians, sports stars, and more — who are active on social media channels and exercise considerable influence on their followers.

Social media influencer marketing booming

But what more and more people mean when they refer to social media influencers are people who have built a following on their platform or platform of choice who may have little or no notoriety outside of that particular social world. They may have built a reputation in the real world for a real skill or they may be self-invented internet celebrities who have become socially famous for being famous, more or less.

What social media followers look for in a person or brand

What influencers bring for banks and credit unions is something beyond the community spirit or financial expertise that is stock in trade for these institutions on social media. While some institutions have found ways to create compelling online personalities for their brands, “Provides useful information,” a more financial trait, ranks fourth in the Mintel ranking above, behind “Entertaining” and “Funny.” True, “Honest” comes in second, but even over a decade since the financial crisis, the industry doesn’t enjoy the same levels of trust it once did.

And while the public is far from naive about advertising and marketing, when it comes to social media influencers, they have proven increasingly accepting of this phenomenon.

Ornelas said that Mintel research indicates that 73% of consumers surveyed understand the difference between a celebrity and an internet celebrity. 71% understand that a social media account that is promoting a product or service is likely being paid to do so. And only about one in three expect that internet celebrities promote solely those products that they personally use.

Instagram dominates influencer marketing

Instagram “has really become the most critical marketing channel,” Ornelas said, and this applies especially to influencer marketing. As Instagram has grown as a platform, being acquired by (and surpassing) Facebook and expanding the types of content it can support, it has become many influencers’ weapon of choice. For this reason, Ornelas concentrated much of her presentation on Instagram usage by influencers for brands.

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Instagram Becomes Influencer Marketing Focus

Ornelas pointed out that research by MediaKix, an influencer marketing agency, indicates that Instagram holds three of the top five places for most effective content formats for influencer marketing:

  • Instagram Post: a still photo with commentary: 78%
  • Instagram Story: a newer format that can tell an ongoing story with multiple parts, but potentially only being viewable for a short time: 73%
  • YouTube Video: 56%
  • Instagram Video:: 54%
  • Blog Post: 36%

In almost every way, Instagram outshadows other social channels for influencer marketing purposes. Ornelas pointed out that the platform has over 1 billion monthly active users and that 500 million people visit someone’s Instagram Stories daily. MediaKix reports that nine out of ten marketers say that Instagram is important to their influencer marketing strategy.

“As a result, Instagram is investing a lot to be sure its creators feel empowered,” Ornelas said. Multiple new development tools have been made available to Instagram creators to enable them to post leading-edge content.

Instagram has also streamlined the ability to make purchases through postings, enabling consumers to buy without needing to leave Instagram for a website landing page. Influencers do so by tagging products and services they mention for clickable ordering. This is on top of paid posts available to brands and paid promotion to multiply the reach of an Instagram influencer’s normal following.

“There’s much more than consumers just mindlessly scrolling through their feeds,” said Ornelas.

As a result, spending on sponsored Instagram posts has taken off.

Sponsored Instagram posts soar

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Probing the Three ‘I’s of Influencer Marketing

Ornelas said that three elements go into influencer marketing:

1. Intrigue. Marketing should be examining how it is improving affinity for its brand. How does the institution want to be perceived? How has it improved the public’s understanding of what it stands for?

2. Inform. “Are you teaching consumers what your value-add is? What your service offerings are? This is the opportunity not only to let people know who you are but also what you offer,” said Ornelas.

3. Ignite. “One of the great things about influencer marketing is that it’s not just the celebrity-level people that can create traction for you,” she explained. “But in terms of reach, that’s where you want to start.”

Influencers can offer a brand access to an audience that is less likely, otherwise, to follow brand accounts. While Instagram says that nine out of ten users follow at least one business, research by Mintel specifically on financial brands paints a fairly dismal picture. Mintel has found that only 10% of adults overall follow a financial services company on social media. In general, as shown in the chart below, older consumers tend to be the ones who lean towards following brands on social media, while younger generations , especially Generation Z, are much more likely to follow influencers.

Which generations follow influencers

Which Influencers Fit Your Financial Institution?

Picking the influencers who will be the best match for a brand hinges on five factors that a financial marketer must weigh.

1. Authenticity. While the statistics mentioned earlier indicate that there is some tolerance on the public’s part for commercial tie-ins, there’s also something to be said for a genuine connection. Brands should ask how selective an influencer is in choosing the types of brands they’ll work with? Ideally, an influencer shouldn’t be a complete mercenary.

2. Relevance. How well do the influencer’s typical images and messages jibe with your brand? If it would seem strange for a given influencer to be promoting a bank or a credit union, all the reach in the world may not justify an alliance. An influencer’s lifestyle may not be in synch with a bank or credit union’s image, Ornelas said. The best way to judge all this is simple: Scroll through the influencer’s feed.

3. Reach. Numbers by themselves don’t mean as much as what’s behind the numbers. This means drilling down into the raw audience an influencer commands to see what it consists of, in terms of gender, age and other key demographic factors. “Who” can be more important than “how many.”

4. Consistency. Regular posting is a basic, because otherwise followership drops off and you have no audience.

5. Engagement. Ornelas noted that simply cranking out posts doesn’t by itself make an influencer a good choice. First, “you want to make sure they aren’t promoting products all the time,” she said. Second, “Are they actually engaging with their followers? Are they asking questions? Are they responding to their community?”

Bank of America social media influencers

Bank of America invited a select group of influencers to attend a Florida retreat called “Better Money Habits,” in order to send messages about money to Millennials. Tonya Rapley, left, runs the “My Fab Finance” website. Professional photographer Bryan Adam Castillo and his wife Alexis do photo shoots around the world on Instagram. Each have many thousands of followers and shared money messages from the retreat.

Vanity metrics — like total followers without context — are coming to be less of a factor in making social influencer choices. The demand for ROI on spending has increased, according to Influencer MarketingHub research, with actual conversions or sales resulting from the influencer’s activities now representing the strongest factor in measuring the success of an influencer campaign.

Influencer marketing metrics lean toward sales

Now here’s a twist about numbers: More isn’t always better. Mintel research has found that about one in three U.S. adults who follow influencers trust influencers with fewer followers moreso than popular accounts.

Comperemedia breaks out Instagram influencers into five “leagues”:

  • Mega: 1 million followers or more.
  • Macro: 500,000 to 1 million.
  • Mid-Tier 50,000 to 500,000.
  • Micro: 10,000 to 50,000.
  • Nano: Below 10,000.

Mintel research indicates that financial institutions on the whole tend to pick mid-tier Instagram influencers for their campaigns. That is their choice 63% of the time, with micro category next at 19%. The rest account for small shares.

The company’s analysis of major financial services marketers indicates that the choices hinge somewhat on the type of product or activity that is being promoted, and overall usage ebbs and flows depending on what brands need to push. While usage was off among financial services players in 2019, Ornelas said that the trend continues to be significant — “It’s alive and well and growing.”

Looking at Wells Fargo, the firm’s research found that the bulk of its influencer work relied on mid-tier accounts. On the other hand, when American Express rebranded its green card, a big chunk of its budget went to micro influencers.

Ornelas explains that micro and nano influencers can be better choices for financial institutions in part because they can devote more effort to actual engagement with followers. In addition, they can be a more efficient choice because they add that engagement while charging less.

She added that the strength of smaller influencers is not surprising because much research has indicated that voices closer to home — family and friends, for example — tend to be influential in terms of which financial services providers consumers choose.

Tips for Pushing Campaigns Over the Top

Ornelas also offered these suggestions for maximizing the impact of influencer marketing for a bank or credit union:

  • Collaborate with influencers, don’t just pay them. After all, they are representing your brand. Some companies actually appoint influencers to be “brand ambassadors” who are identified as such.
  • Avoid the “sea of sameness.” Social media draws on common looks and memes. The ubiquity of stock art, the power of the high-tech cameras in mobile devices, and more can lead to high-quality vanilla. Ornelas suggested that successful influencers try to stand out.
  • Pay attention to Hispanics. This demographic group has been identified as a growth market for many industries, including financial services. Yet Ornelas said that many Hispanics feel that brands aren’t making an effort to speak to them and to their interests. Family and home are two key interests.
  • Navigate product placement carefully. There are actually rules on influencer marketing, through the Federal Trade Commission, which financial marketers should be familiar with. But there is also a role for taste, in the sense of figuring out when to be generic and when to actually show a product, such as a card. In any case, placement should fit the story the influencer is telling.
  • Realize you can’t relax. “On social media, testing and learning never stops.”

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