Influencer Marketing: Why Nano-Influencers Might Be Your Best Bet
In the fast-paced world of digital marketing, influencer marketing has emerged as a powerful tool for brands to connect with their audience. But a burning question remains: should companies target influencers with massive followings or those with a smaller, more engaged audience?
A recent study by Maximilian Beichert of Bocconi’s Department of Marketing, Andreas Bayerl (Erasmus University Rotterdam), Jacob Goldenberg (Reichman University), and Andreas Lanz (University of Basel), dives deep into the effectiveness of influencer marketing by analyzing data from over 1.8 million purchases and three comprehensive field studies. The goal was to determine whether targeting low-followership influencers (nano-influencers) or high-followership influencers (macro-influencers) yields better revenue for direct-to-consumer (DTC) firms.
The study found that nano-influencers, despite having fewer followers, generate significantly higher engagement rates compared to their macro counterparts. This higher engagement translates into better return on investment (ROI) for brands.
Nano-influencers outperformed macro-influencers across three key performance metrics: revenue per follower, revenue per reach, and return on influencer spend (ROIS). For instance, nano-influencers generated €0.37 per follower, while macro-influencers only managed €0.008.
The researchers explain these findings through social capital theory, which suggests that as an influencer's followership grows, the engagement between the influencer and their followers decreases. This is because larger audiences often lead to weaker ties and less personal interaction.
The study's conclusions are backed by extensive data, including secondary sales data and results from three field studies involving hundreds of paid influencer endorsements. This robust evidence highlights the consistent advantage of targeting nano-influencers for revenue generation.
For brands, this research offers a clear strategy: prioritize nano-influencers for influencer marketing campaigns. These smaller influencers not only provide a higher ROI but also foster stronger connections with their audience, leading to more meaningful and impactful marketing efforts.
In the ever-evolving landscape of digital marketing, understanding the dynamics of influencer marketing is crucial. This study by Beichert and colleagues provides valuable insights, showing that when it comes to generating revenue, smaller influencers can pack a bigger punch. Brands looking to maximize their marketing efforts should consider the power of nano-influencers and the unique advantages they bring to the table.
