If you’re a financial services marketer, influencers are likely something you’ve considered, maybe dabbled in, but haven’t made a key part of your go-to-market strategy. If you are or speak to a marketer in the CPG or retail world, influencers are likely a huge part of your approach. Why the disconnect?
Influencer marketing is modern PR. Not in the sense that influencers can replace media outlets (and we’ve seen the problems it can create when they do), but in the sense that both influencer marketing and PR are all about tapping into the pools of attention of your audience that someone else has already built up.
It’s just earned media. Someone else has been able to attract the attention of the audience you’re trying to reach and you’re asking or incentivising them to put your brand or product in front of that audience. The fundamentals and opportunity both channels offer are the same.
The biggest difference is also the biggest opportunity for businesses that move quickly and execute well: influencer marketing is tremendously underpriced for the attention you can get. Top tier influencers can be incredibly expensive – these are the modern celebrities of our time. If you were going to pay a movie star to promote your brand, you’d be prepared to pay a pretty penny. It’s the same with top tier influencers. But mid-tier and “micro” influencers can be much cheaper or even free in some cases.
Many industries have already figured this out, and you have plenty of case studies of both incumbent and challenger brands in CPG, retail, hospitality, and plenty of other verticals driving hyper-growth with influencer marketing. GymShark built most of their business in the UK on the back of early YouTube and then Instagram influencers. Glossier has built a $1B business by leveraging influencers as advocates, mostly in the US.
So why are we behind the curve on influencer marketing in the financial services industry? Well, in part it’s because CPG tends to be ahead of the curve on marketing because of how dependent those businesses are on marketing to grow. There’s also the (very real) concern around regulation – an influencer promoting a lip gloss is different than one promoting a mortgage or investment (although having bloggers promote FS products has been around for a long time, and the concept is essentially the same – pools of attention of the audience you’re trying to reach). But there’s also a hesitancy in FS to think that this industry is different. It’s financial services – people won’t listen to an influencer for a decision that important, right? Wrong.
The opportunity that influencer marketing presents is industry agnostic because it’s built on human and economic truths, not industry-specific ones. Underpriced attention coupled with a strong brand/product offering will drive growth. The way you need to execute an influencer marketing strategy or campaign might be different based on the industry you’re in or the business you are, but the fundamentals are the same.
Check out this case study on how Cash App grew 60% YoY with influencer marketing. It’s amazing how under-valued influencer marketing still is, especially in the financial services world. The attention is incredibly underpriced if you have a smart campaign, something of value to offer, and a strong product to back it up. Look how this CAC math stacks up:
Based on research done by Ark Invest, retail banks are spending between $350 and $1,500, which converts to an average of $925 per new customer acquired. If Cash App is to spend the same rate of $925 per new customer, with a $10,000 giveaway budget, they would only gain an underwhelming total of ten new customers. However, since Cash App is adopting a viral marketing strategy, they are reaching a conservative estimate of 50,000 unique Twitter users per post. Even if only 1% of the 50,000 users are new to Cash App, that converts to 500 new users. Hence, with $10,000, Cash App would be able to gain at least 500 new users at the rate of $20 per customer acquired.
There is a huge opportunity for financial services businesses to tap into influencer marketing as a viable, effective, and efficient channel to drive growth. Now, the execution matters more than the idea, meaning you need to do it the right way. You need to be aware of the regulations, choose the right influencers, manage them the right way, and deliver the right message. But if you can do that well, it will work. And because the industry is behind the curve on this opportunity, there’s even more underpriced attention to tap into. If Cash App ran the same campaign even two years from now it would not deliver the same results. The landscape and pools of attention are constantly changing and challengers like Square are excellent at finding and tapping into them.
Most businesses are doing some kind of influencer marketing at this point, but few are maximising its potential as an awareness, acquisition, and advocacy channel. Challenger businesses don’t just find the underpriced attention, they double, triple and quadruple down when they do find it to maximise the business results it can drive before their competition gets there.
Every business should have a strong earned media strategy that maps the pools of attention of their audience and analyses where it’s over and underpriced. The specific tactics will differ (maybe traditional PR is a good move for you), but chances are, especially if you are a financial services brand, influencer marketing holds a big opportunity for you that you haven’t fully tapped into yet.
