Influence marketing is all the rage. Influencers get paid big bucks to capitalize on their large networks in hopes that the brands they recommend will fly off the shelves.
In fact, influencers have a more limited impact on purchases — and their biggest impact comes at a small, defined portion of the purchase cycle. Thus, influence marketing ignores some of the most critical steps in the buying process. You can read another post about the failure of influence marketing to move product as well as recommendations for better ROI.
To understand influence marketing, take a look at this infographic from Google and McKinsey.
Rather than the funnel that we commonly see, the infographic shows a circular process that better fits actual purchase decisions.
You see, consumers don’t always use a see–think–do process that starts with awareness and ends with conversion, like that depicted on the right. Instead, they might go through a see–do–think, which describes an impulse purchase or a see–feel–do when emotional input goes into the decision-making process. They also might take large breaks during the process, reflected by the narrowing of the funnel towards the bottom, but they might also jump back into the process where they left off after some time, especially if factors, like affordability, interfere with making a purchase.
Stages in the decision-making process
In the circular depiction of the consumer decision-making process, a consumer might start anywhere. But, let’s assume the consumer starts with a first awareness of the product and follow that consumer to the final stages of the process.
Stage 1: Consideration set
We commonly think prices heavily influence consumers. All you have to do is look at the number of i-devices (iPad, iPhones, Macs) to understand how little price impacts purchase as these are often the most expensive options in their product category.
Instead, consumers form a consideration set composed of acceptable products in a particular category. If we’re in the market for a phone, that consideration set might include iPhone, Samsung, Motorola, and Google. Once in the consideration set, price often becomes much less important.
In addition to a consideration set, we might have an inept set consisting of products that don’t offer sufficient performance propositions to fulfill our needs. A product from a brand we’ve had problems with in the past or have heard negative comments about might end up in the inept set. As a brand, you NEVER want to be there because you have no chance of being purchased by the consumer.
A number of factors land a product in the consideration set, such as positive reviews, advertising, or recommendations from social media (including tacit recommendations that simply involve seeing someone with the brand or having them refer to the brand, such as emails that state the response was created on a particular mobile phone). For instance, Starbucks owes much of its success to photos showing celebrities simply holding their cups. This shows how influence marketing works.
Influencers who are compensated for their opinions often have less impact because consumers don’t trust them to be objective, which is the true value of influence marketing.
Stage 2: 0 moment of truth
Consumers are constantly updating their consideration set as they take in new information from a variety of sources. Since this process is driven by recall, in most cases, rather than a physical list, memory plays an important part in driving purchases. For instance, a consumer might simply forget about a brand in their consideration set if they aren’t prompted to remember it. Seeing a new commercial for a brand, might add it back into the consideration set again and drive purchases.
Another pesky element of memory is that things have a tendency to get all jumbled up so we don’t always remember accurately. After all, we have lots more important things to occupy our brains than remembering your product. I did a study a few years back where I asked folks to tell me about an ad they’d seen for a prescription drug. A frightening result occurred when I noticed a strong tendency of informants to mix up the drugs and even simple things like the disease it was designed to treat. Or they reported the main elements of the commercial attributing it to a different brand. This could have deadly consequences and you’d think we’d devote more brain power to remembering these brands than, say, toothpaste.
Stage 3: 1st moment of truth
A final list of brands fleshes out the consideration set, which now contains more information about the brands. We may now move to a purchase decision or loop back to the 0 moment of truth to gather more information.
Our purchase decision is only part of the process that makes your cash register ring. The other part is actually acting on that decision. A variety of factors might interfere with making an actual purchase to the point where we often see only a 30% correlation between a purchase decision and an actual purchase. That means only about 30% of the people who say they’ll buy the brand actually do.
Stage 4: 2nd moment of truth
Influence marketing has come full circle as the buyer opens and uses his/her product. They’re now the one able to influence others facing a purchase decision. It’s these personal, unbiased recommendations that really add gas to the influence marketing engine.
It’s not enough just to provide a good product, which is hard enough. You have to motivate your buyers to recommend your brand to their friends. Sometimes it takes superior performance … giving buyers a little something unexpected … that drives recommendation. In other cases, it’s a constant stream of digital efforts, especially email marketing, that might push them over the edge to make a recommendation.
Recommendations from existing buyers are much more valuable than getting them to purchase your product in the first place, so don’t lose focus on influence marketing at this juncture.
Stage 5: Trigger
Remember in Stage 3 we talked about how external factors, such as affordability, might interfere between the purchase decision and an actual purchase. Sometimes it takes a trigger to overcome inertia or to help the consumer cross the line to actually make a purchase.
Think about all the factors that might interfere with a purchase and wipe them out. Amazon, for example, got rid of the many clicks involved in the process with their 1-click buying. The fewer clicks the more likely you are to make a purchase.
In other cases, a trigger comes in the form of affirmation from your social network. If everyone else seems to be making a similar brand choice, it may be just the nudge a consumer needs to push them over the edge. Influence marketing at work.
Don’t stop there
Now’s not the time to stop your efforts at influence marketing. You need to keep communicating to ensure you stay in the consideration set, you need to get feedback from users to ensure you continue to delight them with your product and innovate to keep giving them more. You need to engage with them to motivate them to participate in your influence marketing program.