How to win sales and influence customers

How to win sales and influence customers
Published: 
October 2013

With the rise of influencer marketing, companies are paying celebrities up to $10,000 a tweet to mention their products, while bloggers are benefiting from VIP treatment. But to what extent can a small number of people really influence opinions and drive sales?

[An influencer] is an opinion leader, has a popular blog or strong social presence, speaks offline to press or to audiences and/or has a strong network online and off.

When the Sydney-based software company Altium wanted to launch a new product in North America, it decided to depart from its usual practice of seeking coverage in trade journals and try a different approach.

Research revealed that peer validation was the most important factor in buying decisions amongst engineers, who are the target audience for its NanoBoard 3000. Altium used a US marketing agency to identify those engineers who were talking about technical products online, offered them a NanoBoard free of charge and invited them to review it.

The exercise helped to generate goodwill and allowed the company to identify other influencers in the engineering sector, and the ‘buzz’ it created resulted in additional reviews in the trade media. Altium’s representatives have now started to engage with engineering clubs.

Altium is one of a growing number of companies who are using influencer marketing techniques. Tools such as Klout, Kred and PeerIndex aim to help them identify and rank influencers, while platforms like Crowdtap, Awedience and the newly-launched Singapore-based site Gushcloud enable them to engage directly with influencers to offer rewards or seek feedback.

Of course the power of celebrities to start fashion trends or influence public opinion is nothing new. Companies have long paid for celebrity endorsements. Today that includes sponsored tweets – Kim Kardashian is reportedly paid $10,000 for each time she mentions a specific product or company.

Celebrities aside, the advent of social media has also created a new breed of ‘citizen influencers’. Bloggers with a sizeable following are now being sought out by companies and offered everything from free holidays to gourmet food and luxury goods.

Another factor in the rise of influencer marketing has been research by academics such as Robert Cialdini author of the 1984 best seller, Influence: The Psychology of Persuasion. However it was the publication of The Tipping Point by Malcolm Gladwell in 2002 that highlighted the disproportionate role played by a small number of ‘influentials’ in the spread of ideas or trends.

Gladwell calls it the ‘law of the few’ and cites the way in which a few New York trendsetters helped revive the fortunes of Hush Puppies, transforming what was a dying footwear brand into a ‘must have’ accessory.

So how does influencer marketing work in practice? The first step is to identify your influencers. Who makes buying decisions about your product or service and who influences them? The list may include bloggers, journalists and celebrities but also include politicians, community leaders and friends.

According to Appinion, another influencer marketing platform, the fact that people may like your brand does not make them an influencer as they may not have a platform, online or offline, from which to influence others. “An influencer causes others to take action,” it says. “He or she is an opinion leader, has a popular blog or strong social presence, speaks offline to press or to audiences and/or has a strong network online and off.”

Appinion’s ‘road map’ outlines four stages to turn people from influencer to ‘super advocate’, the first being to build awareness. Influencer marketing takes conventional marketing techniques but places them within a new framework.  So for example, traditional methods such as press releases or a presence at tradeshows can play a part in raising awareness, alongside newer methods such as a Twitter account, blog and webinars.

Once influencers are aware of your product or service, the next stage is to build credibility. During this phase you are establishing trust and goodwill so don’t oversell. The relationship should be two way so in addition to educating them about your product or service, you should also show you are listening to their ideas.

The final stages are to create an emotional connection, and create ongoing loyalty. You might want to invite influencers to a ‘brand party’, focus groups and events, give them products and VIP treatment, invite them to speak at your events or contribute content to your website.

The W20 Group, a US marketing agency, ran a campaign on behalf of the Harry Potter books and movies in which it narrowed the key influencers down to just 43 people. Its president Bob Pearson says: “We’re finding that if you take email content and send it out to an audience of millions of people, you get a half per cent click through rate if you’re lucky. But if you go to those top 50 influencers the click through rate is closer to 9.5 to 10 per cent.

“Why? Because those people are passionate about sharing information and content within their communities. They want to become a relevant member of their community as opposed to talking at them.“

However not everyone is convinced by the ‘law of the few’. One critic is Duncan Watts, an Australian who is now a principal researcher at Microsoft Research. Watts, who has pioneered the mathematical modeling of social networks, dismisses the idea that trends are started by a few people who act as social hubs to broadcast ideas.

“It’s true that some people have more friends and are more gregarious than others. And we’re tempted to call these people hubs,” he explains. “But if you actually look at the numbers, they’re only maybe a few times more popular or a few times more connected than an average person.”

Nevertheless, influencer marketing continues to gain ground with marketers around the world. Mike Montano, a specialist with the US agency gyro, says: “Influence marketing is an authentic, humanly relevant approach to getting messages to the masses. We’re not asking influencers to use ‘advertising speak’ but instead their own words. In a world that is becoming increasingly numb to traditional advertisements, influencers use word-of-mouth tactics to reach others and keep the conversation going.”