What is influencer marketing?

By definition, influencer marketing is the practice of leveraging individuals with social influence to promote products or services. Influencers typically use TikTok, Instagram, Facebook, and YouTube to promote products or services, leveraging these platforms to offer insights, promote financial literacy, and advise on financial services.

Just a few years ago bank influencer marketing was limited to a small, elite group of athletes, academics and actors, individuals with enough of a following from other work and a loyal fan base to catch the eye of companies looking to introduce or expand the reach of their products. Now, influencers both in bank influencer marketing and outside the financial services space come from all walks of life. Think of it as a democratization of influence, with a more leveled playing field giving opportunities for individuals with big ideas (plus a laptop and webcam) to share reviews and insights that can reverberate around the world.

Categories of Influencers

In his groundbreaking book, “The Long Tail” author Chris Anderson noted that new efficiencies in marketing (i.e.: free tools like social media) are “resetting the definition of what’s commercially viable across the board.” An influencer doesn’t need a million followers to be important or earning big bucks, they can do very well by reaching and meeting the needs of small niche groups.

Nano-influencers: 1,000-10,000 followers
Micro-influencers: 10,000-50,000 followers
Mid-tier influencers: 50,000-500,000 followers
Macro-influencers: 500,000-1,000,000 followers
Mega-influencers: 1,000,000+ followers

The Growing Influence of Social Media in Finance

A 2019 study by the Global Wealth Index found that over 50% of millennials report making financial decisions based on online content (Tori Dunlap from above is just one of many millennial voices in the space, many equally as worthy of checking out). One can assume that percentage has and will continue to grow as reliance on social media for news and entertainment continues to increase year over year.

Hashtags make it easier to find content niches, and financial tags are among the most prevalent across all platforms. To identify content as pertaining to a niche, content producers will include a hashtag (#) followed by an identifying word(s) to draw in eyeballs searching that specific space.

#PersonalFinance had surpassed 3.5 billion views on TikTok as of February 2022. #FinTok has been viewed more than 500 million times, fostering deep and detailed discussions around many topics, but most interestingly, day trading. Information shared online has the power to move markets (the GameStop “meme-stock” kerfuffle seems like ancient history, but it occurred in 2021) and much of the discussion in these spaces does still revolve around individual stocks, but influence isn’t confined to day trading and growth in the space is likely to include areas that appear much more applicable and practical.

The Role of Credibility and Trust in Financial Services Marketing

According to PwC’s Digital Banking Consumer Survey, 68% of consumers felt that online reviews and opinions from peers influence their choices of financial services. Savvy marketers are probably asking themselves right now “how are we monitoring, amplifying, or mitigating online reviews and opinions?” PrintMail can help, offering solutions for digital marketing for banks.

Over 70% of consumers report trust as a critical factor in the buying process. In an industry like financial services, where trust is essential, it has become increasingly hard to ignore the role influence and influences can and should play in marketing efforts.

Measuring Roi: Tools And Techniques for Financial Influencers

Once a decision has been made to engage with influencers, their efforts need to be tracked and measure like other marketing efforts. Here are a few Key Performance Indicators (KPIs) to use when considering how social media influencers can help you promote and scale your bank:

Customer Acquisition Cost (CAC):
Definition: CAC is the cost associated with acquiring a new customer through influencer marketing.
How to Calculate: CAC = Total Cost of the Influencer Campaign / Number of New Customers Acquired
Importance: By understanding CAC, businesses can determine how cost-effective their influencer marketing strategy is.
Customer Lifetime Value (CLV):
Definition: CLV represents the net profit attributed to the entire future relationship with a customer.
How to Calculate: CLV = (Average Spend per Purchase X Frequency of Purchase) x Average Customer Lifespan
Importance: By comparing CLV to CAC, firms can determine the long-term value of customers acquired through influencer campaigns.
Digital Engagement:
Definition: Digital engagement measures how users interact with the content provided by influencers.
Key Metrics: Metrics can include likes, shares, comments, website clicks, and conversion rates.
Importance: Higher engagement can signify better content relevance and can indicate a more substantial potential ROI.

Localized Influencer Marketing

Content creators with audiences in the millions may carry the most cache, but for many financial institutions, their reach (and expense) is hard to justify. Collaborating on campaigns with smaller scale influencers from your specific region or community to improve engagement is likely the most cost-efficient path. For example, a local bank may choose to partner with a nano- or micro- influencers in their area who feature current real estate trends and/or covers upcoming local events.

How Much Does an Influencer Campaign Cost?

In many ways we are still in the wild west age when it comes to influencer marketing. Costs are often highly negotiable, and banks may have the opportunity to arrange favorable terms and more measurable outcomes.

Several online calculators speculate on costs associated with financial influencers on Instagram, with HypeAuditor offering ranges from $100-$10,000 per post or video.

Cost is just one factor to consider when engaging with an influencer or influencer marketing agency. A discussion with the team at PrintMail may help solidify plans and set proper expectations.

Criticisms And Counterarguments: Is Influencer Marketing Always Right?

Almost since their inception, social media platforms have been accused of presenting unrealistic views of the world and the lives that people live. Our inclination to only post photos and information that present us positively leads to challenges for consumers who are left to figure out what is real.

Over-glorification of products, including financial ones, can be misleading and must be handled very carefully to ensure honesty and compliance. It is important to understand that influencers are not regulated the way financial institutions are, but when contracted to promote services, they must act in ways that are transparent and compliant – and that responsibility falls squarely on the financial institution.

Take the Next Step to Leverage Finfluencer Marketing for Your Financial Institution

Incorporating financial influencer marketing into your financial institution’s marketing plan can create unique opportunities to connect with your customers in meaningful ways. Ready to get started? Partner your community outreach efforts with a financial industry-focused digital marketing strategy or contact PrintMail Solutions to learn how you can bring your customer communications to the next level.