the urgent need for more research on influencer marketing

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The Research Behind Influencer Marketing

by Jacob Goldenberg, Andreas Lanz, Daniel Shapira, and Florian Stahl

The influencer endorsement market more than doubled from 2019 to 2021, growing from $6.5 billion to $13.8 billion ( Statista 2021 ). User-generated content networks like Instagram, LinkedIn, SoundCloud, Twitter, and YouTube fueled the growth as they transformed the customer targeting, acquisition, and retention process.

Influencers and their followings provide firms unique access to potential customers difficult to reach through channels like online banner advertisements. As a result, companies have found selecting powerful influencers to seed customer targets can drive marketing success ( Haenlein and Libai 2017 ).

But which influencers should firms target to find potential customers? Significant literature suggests high-status influencers with large followings are effective (e.g., Hinz et al. 2011 ). Such macro-influencers, or “hubs” ( Goldenberg et al. 2009 ), boost information dissemination in user-generated content networks and drive product adoption. More recently, researchers and practitioners have recognized the value of micro-influencers with only a few followers (e.g., Haenlein et al. 2020 ). Sometimes the generation gap between an influencer and potential customers leads to misalignment (Clegg et al. 2022).

Several recent publications offer important and actionable insights for individuals and firms attempting to seed customers in the evolving social media landscape.

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Selecting Influencers

Individual and corporate social network users can use their own profiles to shape their follower base through outbound activities. By targeting influencers with follows, private messages, likes, and reposts, they can trigger notifications in the influencers’ timelines and possibly elicit follow-backs. The strategy, especially relevant for small- and medium-sized enterprises, requires no monetary budget and, when successful, represents an unpaid endorsement from the influencer.

Outbound activities can trigger direct returns via follow-backs from influencers and indirect returns via follow-backs from influencers’ followers. Indirect returns rely on influencers reposting content.

Lanz et al. (2019) find that network users do not generally benefit from soliciting unpaid endorsements from macro-influencers with large followings because they are orders of magnitude less responsive than micro-influencers. Direct returns are therefore unlikely and risky. When macro-influencers do respond, the researchers find the indirect returns from their followers do not compensate for the high risk. Lanz and colleagues offer the first empirical evidence for micro-influencers’ effectiveness, finding them to be six times more effective than macro-influencers for growing a follower base of potential customers within two years.

The idea also applies to paid endorsements, as macro-influencers may be unreceptive to requests, regardless of compensation. According to Lanz and colleagues’ 2019 work, endorsements depend on the status difference between the solicitor and influencer. Beyond status difference, the solicitor for a paid endorsement must realize that an endorsement may positively bias the influencer’s content while decreasing its persuasiveness due to the affiliation ( Pei and Mayzlin 2021 ). For paid endorsements, it is important to specify the affiliation.

When selecting influencers, Valsesia, Proserpio, and Nunes (2020) find following fewer other users signals autonomy and enhances perceived influence. The researchers suggest that macro-influencers typically follow few others, while micro-influencers have more balanced follower-to-followee ratios.

Todri, Adamopoulos, and Andrews (2021) demonstrate that users may form a sense of social identity based on their physical location. Even in online environments geographical proximity matters for social influence.

Firms should also consider network overlap when selecting influencers. Overlap may occur among common followees, common followers, or common mutual followers. Peng et al. (2018) find return likelihood increases with network overlap. Although the researchers find that all forms of network overlap positively affect reposting (i.e., indirect returns), common followers are more important than common mutual followers. In a simulation study, the authors show that a 20% increase in network overlap is associated with a 13% decrease in influencer activation time.

Strengthening Follower Bases

Ansari et al. (2018) find that outbound activities can generate significant long-term impacts via follower base growth and content consumption, with follower base connectedness being critical—and offering considerable predictive power. Individuals and firms should therefore supplement their outbound efforts with activities to increase connectedness, such as additional opportunities for followers to interact on- or offline. The researchers focus on musicians and suggest concerts and fan gatherings as examples.

Chen, van der Lans, and Phan (2017) demonstrate that assuming a binary network structure, where users simply follow each other or not (e.g., Ansari et al. 2018 ; Lanz et al. 2019 ), can be misleading. The researchers therefore develop a multinetwork approach for activating influencers by inferring network connection weights based on features like recency and interaction intensity, as well as dissemination process. In an empirical application, they demonstrate relationship duration and private message exchanges generate a multinetwork extending beyond connections alone.

What value does growing a follower base of potential customers to support wide content dissemination deliver? Based on a Facebook field experiment in which they consider an incentive-based health and wellness program allowing customers to accumulate points for offline behaviors like exercising, Mochon et al. (2017) find that business page likes (i.e., followers) can translate into changes in offline behaviors, including purchases. Specifically, using social media platform functionality to acquire likes translates into a 8% greater influence on offline customer behaviors. (For more on the value of Facebook likes, see Colicev (2021) .)

For unpaid social network endorsements, the most basic form of influencer marketing, firms can capitalize on outbound activities like follows, private messages, likes, and reposts. However, activating micro-influencers can be more effective than approaching macro-influencers.

Firms must also consider geographical proximity as well as the number of followees and network overlap when selecting influencers for customer seeding. Moreover, marketers must increase connectedness among their own follower base to achieve long-term impacts, meaning they must carefully integrate each new follower into their existing egocentric network, as there is more to a connection than simply a follow.

Author Bios

Jacob Goldenberg is Professor of Marketing at Reichman University, Herzliya, Israel, and a Visiting Professor at Columbia Business School, New York, New York.

Andreas Lanz is Assistant Professor of Marketing at HEC Paris, Jouy-en-Josas, France.

Daniel Shapira is Senior Lecturer in Marketing at Ben-Gurion University, Beer Sheva, Israel, and a Permanent Adjunct Research Faculty at the University of Mannheim, Mannheim, Germany.

Florian Stahl is Professor of Marketing at the University of Mannheim, Mannheim, Germany.

Goldenberg, Jacob, Andreas Lanz, Daniel Shapira, and Florian Stahl (2021), “Influencer Marketing,” Impact at JMR , (February), Available at: https://www.ama.org/2022/02/16/the-research-behind-influencer-marketing/

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Chen, Xi, Ralf Van der Lans, and Tuan Q. Phan (2017), “Uncovering the Importance of Relationship Characteristics in Social Networks: Implications for Seeding Strategies,” Journal of Marketing , 54(2): 187–201. https://doi.org/10.1509/jmr.12.0511

Clegg, Melanie, Reto Hofstetter, Lea Schindler, Olivia Deubelbeiss, Andreas Lanz, Martin Faltl, and Torsten Tomczak (2022), “Bridging the Generational Divide,” Harvard Business Review , Magazine Jan/Feb.

Colicev, Anatoli (2021), “The Real Value of Facebook Likes,” Impact at JMR , January. https://www.ama.org/2021/01/26/the-real-value-of-facebook-likes/

Goldenberg, Jacob, Sangman Han, Donald R. Lehmann, and Jae Weon Hong (2019), “The Role of Hubs in the Adoption Process,” Journal of Marketing , 73(2): 1–13. https://doi.org/10.1509/jmkg.73.2.1

Haenlein, Michael, Ertan Anadol, Tyler Farnsworth, Harry Hugo, Jess Hunichen, and Diana Welte (2020), “Navigating the New Era of Influencer Marketing: How to be Successful on Instagram, TikTok, & Co.,” California Management Review , 63(1): 5–25. https://doi.org/10.1177/0008125620958166

Haenlein, Michael, and Barak Libai (2017), “Seeding, Referral, and Recommendation: Creating Profitable Word-of-Mouth Programs,” California Management Review , 59(2): 68–91. https://doi.org/10.1177/0008125617697943

Hinz, Oliver, Bernd Skiera, Christian Barrot, and Jan U. Becker (2011), “Seeding Strategies for Viral Marketing: An Empirical Comparison,” Journal of Marketing , 75(6): 55–71. https://doi.org/10.1509/jm.10.0088

Lanz, Andreas, Jacob Goldenberg, Daniel Shapira, and Florian Stahl (2019), “Climb or Jump: Status-Based Seeding in User-Generated Content Networks,” Journal of Marketing Research , 56(3): 361–78. https://doi.org/10.1177/0022243718824081

Mochon, Daniel, Karen Johnson, Janet Schwartz, and Dan Ariely (2017), “What Are Likes Worth? A Facebook Page Field Experiment,” Journal of Marketing Research , 54(2): 306–17. https://doi.org/10.1509/jmr.15.0409

Pei, Amy, and Dina Mayzlin (2021), “Influencing Social Media Influencers Through Affiliation,” Marketing Science , Article in Advance. https://doi.org/10.1287/mksc.2021.1322

Peng, Jing, Ashish Agarwal, Kartik Hosanagar, and Raghuram Iyengar (2018), “Network Overlap and Content Sharing on Social Media Platforms,” Journal of Marketing Research , 55(4): 571–85. https://doi.org/10.1509/jmr.14.0643

Statista Research Department (2021), “Influencer marketing market size worldwide from 2016 to 2021,” Statista.com , Aug. 12. https://www.statista.com/statistics/1092819/global-influencer-market-size/

Todri, Vilma, Panagiotis Adamopoulos, and Michelle Andrews (2021), “Is Distance Really Dead in the Online World? The Moderating Role of Geographical Distance on the Effectiveness of Electronic Word-of-Mouth,” Journal of Marketing , forthcoming. https://doi.org/10.1177/00222429211034414

Valsesia, Francesca, Davide Proserpio, and Joseph C. Nunes (2020), “The Positive Effect of Not Following Others on Social Media,” Journal of Marketing Research , 57(6): 1,152–68. https://doi.org/10.1177/0022243720915467

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The urgent need for more research on influencer marketing

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Influencer Marketing: Current Knowledge and Research Agenda

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Over the past few years, the increasing popularity of social media influencers has made influencer marketing a prominent and prevalent strategy for businesses. Its unique aspects, innovative approaches, and significant commercial value have attracted an increasing body of research. The literature has collectively accumulated a sizable and dispersive list of factors that affect followers’ attitude and intention towards influencers’ recommended products/brands. This paper provides an integrative and cohesive framework, based on Berlo’s SMCR model of communication, to consolidate these factors in a structured manner and provide a comprehensive view on the effect mechanism of influencer marketing. Under this framework, it reviews key factors studied and the major conclusions drawn. Additionally, the paper delineates several important yet understudied areas for future search.

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Farivar, S., Wang, F. (2021). Influencer Marketing: Current Knowledge and Research Agenda. In: Martínez-López, F.J., López López, D. (eds) Advances in Digital Marketing and eCommerce. DMEC 2021. Springer Proceedings in Business and Economics. Springer, Cham. https://doi.org/10.1007/978-3-030-76520-0_21

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Why the Influencer Industry Needs Guardrails

The author argues for an industry in which unethical behavior is punished; professional expectations, pay, and desired outcomes are standardized; and creators are given the same rights and protections as other professional marketers.

And how to professionalize a maturing practice

Idea in Brief

The problem.

Influencer marketing is a global force with huge potential for both positive and negative social impact. Influencers, brands, and social media companies that mislead the public could ruin an industry reliant on credibility.

The industry is built on precarity, with little professional cohesion and inconsistent consequences for unfair play.

The Solution

Marketers must build teams of trustworthy professionals. They must commission work that prioritizes quality and integrity over virality. And the industry as a whole should develop trade organizations and unions to protect influencers, marketers, and the public.

Over the past 20 years the social media influencer industry has grown from nothing into a pervasive global force that has completely rearranged the way information and culture are conceived, produced, marketed, and shared. Commercial sectors such as fashion, beauty, and travel led the way, but nonprofits, government services, and political campaigns are increasingly joining in, hoping to harness the seemingly more authentic medium of influencer marketing.

Stars are using their influencer status to launch their own products and capture more profits for themselves.

• Emily Hund is the author of The Influencer Industry: The Quest for Authenticity on Social Media and a research affiliate in the Center on Digital Culture and Society at the University of Pennsylvania’s Annenberg School for Communication.

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Is Influencer Marketing Worth It?

April 29, 2024 • 5 min read.

Brands pay millions for mega-influencer endorsements, but new research from Wharton’s Ryan Dew and Raghuram Iyengar finds having more followers doesn't always yield the biggest bang for the buck.

Cristiano Ronaldo is not only the world’s highest-paid athlete, he’s also the highest-paid influencer on Instagram, pulling in a whopping $3.23 million per post.

With more than 600 million followers, the soccer superstar is a marketer’s dream with an unrivaled ability to sell products. But endorsements from celebrities like Ronaldo don’t come cheaply, which leaves brands with a big decision to make: Should they shovel out millions for a social media mega-influencer who is sure to bring in more views and customers, or spend much less on a micro-influencer?

Wharton marketing professors Ryan Dew and Raghuram Iyengar tackle that question in their latest paper , “Mega or Micro? Influencer Selection Using Follower Elasticity.” Zijun Tian , marketing professor at Washington University in St. Louis, is a co-author.

Their study offers marketers a new framework to measure the trade-off between the popularity of an influencer and the cost of using them in an ad campaign. Dew said that’s an important contribution of the paper, because most influencer marketing currently relies on unscientific intuition, hearsay, and hope.

“It lets you think about this question from a data-driven, strategic perspective,” he said during an interview with Wharton Business Daily on SiriusXM . ( Listen to the podcast. ) “When you think about optimizing influencer strategy, it’s less fluffy. It becomes just like the strategic decisions you would make in your other marketing decisions.”

“For every additional follower you’re paying for, you’re getting less and less for that.” — Ryan Dew

What’s the Best Influencer Marketing Strategy: Mega or Micro?

The professors analyzed more than 500,000 videos that appeared over six months on the Discover page on TikTok, a leading platform for influencer marketing. They found that the relationship between popularity and engagement is nonlinear. Videos posted by mega-influencers are seen by more people, but high volume doesn’t guarantee more comments, likes, or shares.

The paper notes that mega-influencers tend to have weaker, less intimate connections with their followers, which likely explains why they get less engagement. In fact, the study found that the most engagement seems to happen in the middle of the pack with influencers who have around 7,500 to 10,000 followers.

The framework created by the scholars can be used to calculate what they call “follower elasticity of impressions” or FEI — a measure of a video’s percentage increase in views corresponding with a percentage increase in the number of followers for the content creator. Dew said marketers can think of FEI more simply as “bang for the buck.”

“We find almost universally that this follower elasticity, this bang for the buck you’re getting, declines pretty dramatically as influencer popularity goes up,” he said. “For every additional follower you’re paying for, you’re getting less and less for that.”

There are exceptions. The study found that FEI peaks higher for more popular influencers who hawk gaming-related content, which has a strong social component, and it peaks higher for micro-influencers on ad campaigns where trust and authenticity are crucial.

They also found that FEI holds steady across micro- and mega-influencers when brands launch contests inviting consumers to make template videos about the product.

“Your bang for the buck is the same all the way through from the micro-influencer to the mega-influencer,” Dew said about contest videos. “In these cases, it’s really beneficial to get these super popular influencers.”

“We’re introducing this as kind of a KPI that you should care about.” — Ryan Dew

The Trouble with Algorithms in Influencer Marketing

Measuring FEI was no easy task for the scholars. Even with a massive dataset, it wasn’t as straightforward as matching the number of video views to the number of followers. There were myriad factors to consider, including the algorithms that social media platforms use to help spread content. For example, a person who posts videos about cats may have a large number of followers because they make really great videos that people love to share. “But it could also be that TikTok’s algorithm knows that people love cat videos, so it promotes that person’s video regardless of how popular the creator is just because these videos are about cats,” Dew said.

That’s why figuring out a way to measure elasticity is paramount, he said. The scholars also wanted to make sure their framework is flexible for different marketing scenarios.

“There’s not a one-size-fits-all strategy that we find in our research,” Dew said. “Follower elasticity varies quite a bit, depending on the content that you’re posting and the type of campaign that you want to run. We’re introducing this as kind of a KPI that you should care about.”

Influencer marketing is growing, but it isn’t as mature as other forms of marketing in which elasticity is well-established. Price elasticity determines how much less consumers buy if the price increases. Ad elasticity determines how an increase in ad spending drives up revenue. The professors hope their framework will be helpful as marketers search for the right collaborators, and they encourage other scholars to continue their line of research.

“You can use it as the basis for experimenting,” Dew said. “It’s about bringing influence marketing to the same level as other types of data-driven marketing.”

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How to successfully enter a new market with influencer marketing.

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Chief Growth Officer (CGO) at HypeFactory , a global AI-powered influencer marketing agency.

In recent years, businesses have increasingly adopted influencer marketing, a form of advertising that leverages people with media followings, to promote their products and services. This strategy aims to strike the right balance in targeting specific demographics based on age, gender and product life cycle stage to maximize sales potential. As firms see the impact of influencer marketing, more are considering incorporating it into their marketing efforts.

A study by Influence Marketing Hub indicates that the influencer marketing sector can become a $24 billion industry by 2024. There are some staggering figures surrounding this idea: 82% of marketers think about investing in influencer marketing; while another 67% are thinking of this option.

Influencer marketing allows businesses to connect with consumers on a more personal level and capture their attention by partnering with influential individuals who have dedicated followings in specific niches or interest areas. Companies can successfully break into new markets with influencer marketing by taking the following steps.

1. Conduct Market Research

Establishing who you want to reach in the new market should be your first order of business when crafting a marketing strategy for it. The best way to figure out what makes you unique is to watch what your competitors are doing. Marketers' knowledge of the local area is crucial to the success of influencer marketing efforts. Before beginning a campaign, most people do their homework. Among the things they look into are:

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• Language Specifics: Understanding the nuances of language, such as dialects, slang and idiomatic expressions, is essential for effective and culturally sensitive communication.

• Common Formats for Content: Common media formats for consuming information include articles, videos, infographics and podcasts. The popularity of short-form video content on platforms like TikTok and Instagram Reels has skyrocketed in the last couple of years.

• Biases and Cultural Taboos: Cultural norms and sensitivities must be considered to avoid offending or alienating target populations. Things that are considered taboo in one culture might not be in another. The discussion of religion or politics, for instance, can be considered taboo in certain communities.

• State rules and regulations: It is essential for any marketing endeavor to be in compliance with the laws and regulations set in place by different regulatory organizations. Businesses should pay especially attention to regulations pertaining to data protection and advertising standards.

2. Be Selective With Influencers

When expanding into fresh markets, it is extremely important for modern marketers to choose the right influencers. These influencers excel at delivering authentic and locally relevant messages because of their deep knowledge of their home regions. Using this information to their advantage, businesses can boost their credibility and trustworthiness by advertising to specific communities.

It is wise to investigate the influencer marketing tactics of your rivals in a new area before diving headfirst. Investigate their social media profiles, the people they collaborate with and the content they share.

3. Evaluate Social Media Platforms

The fact is, individuals from various nations have diverse preferences when it comes to social media. According to research, 62.3% of the global population uses social media on a regular basis. People typically utilize the device for 2 hours and 23 minutes per day.

The first step is identifying the appropriate social media platforms for your campaign. The second is selecting influencers to feature sponsored content. When making these choices, key considerations include your target audience, the dynamics and user base of each platform, your specific business objectives and your allocated marketing budget.

Additionally, understanding the nuances of how a social media platform is used in a given region can help identify when and how your intended audience is most likely to engage with influencer content. After gathering data on platforms and audiences, the next phase is aligning your influencer selections with your company's goals. Whether the goal is to increase brand awareness, enhance sales, or promote specific products or services, it's crucial to collaborate with influencers whose content and audience align with those goals.

4. Work Together And Use UGC's Popularity

Everywhere you go in the world of digital media, there is brand after brand competing for the attention of consumers. People nowadays are pickier than ever before about the brands they engage with and the products they buy. The reliability of user-generated content (UGC), often called genuine customer-generated content, is second to none. Surprisingly, 86% of consumers are more inclined to trust a brand that shares user-generated content, whereas only 12% are willing to buy an item recommended by influencers.

5. Build Lasting Connections

Being authentic and expanding your audience are two keys to success in influencer marketing. Authentic influencers engage their followers in challenges and use popular hashtags to grow their following. It is not enough to just say you are interested; you have to take real, actionable steps to back it up. Producing content that resonates with the interests and values of one's followers is a certain way to build trust and rapport with an influencer's audience. People will come together around it and be motivated to give it their all.

Brands can reap multiple benefits from being genuine and open. In a world where people are looking for real relationships and transparency, brands may establish credibility and trust through true influencer collaborations. By being transparent about sponsored content and adhering to all relevant laws and regulations, brands may prevent unfavorable reactions and establish enduring partnerships with influencers and their audiences. Being authentic is crucial for influencer marketing to succeed in the long run.

Bottom Line

The rundown is as follows: maintain plan agility, undertake accurate market research, identify suitable partners, build trustworthy relationships, launch remarkable efforts, monitor results and adjust as necessary. In this way, the companies may attract new customers and maintain their rapid expansion. Also, remember that the influencer is constantly changing and evolving.

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