While the Federal Trade Commission considers new rules regulating influencer marketing, the ad community has voluntarily adopted its first guidelines for measuring how well the strategy works. The Association of National Advertisers (ANA) guideposts are focused on social media, but could impact spread to other media including podcasters.
Although the measurement guidelines have been available for paid advertisers for almost a decade, the ANA says organic influencer marketing has not benefitted from a similar standardization application. “The lack of both consistency and transparency has limited organic influencer marketing’s value to advertisers, hamstrung its growth, and obfuscated its true ROI,” the trade group says.
A key part of the problem is a lack of measurement standardization and consistency across social media platforms as well as ad agencies. For example, Facebook, Instagram, LinkedIn, Pinterest, Snapchat, TikTok, Twitter, and YouTube each defines what constitutes an engagement differently. One platform considers a video auto-playing in-feed as an engagement, whereas another only counts actions such as likes, comments, or shares.
Similarly, each platform calculates engagement rate differently, and has a different calculation for what constitutes a video view. At the same time, agencies often use proprietary measurement algorithms, which make it challenging for brands to know how different campaigns led by different agencies are performing when compared with each other.
The ANA work with ad agencies and the big social media platforms to craft a potential fix. The result is recommendations for metrics covering awareness, engagement and conversion as well as agreed upon definitions of terms like including total reach, cost per reach, and total impressions. The Conversion Metrics section also offers definitions and insights on total traffic generated, total conversions, cost per conversion, total sales generated, and return on investment.
“Two years ago, in the ANA’s State of Influence report, we asked its members to identify their single biggest challenge in implementing influencer marketing, and the overwhelming response was measurement,” said ANA CEO Bob Liodice. “These new guidelines will help all marketers harness the power of this important and growing discipline and help them maximize their ROI,” he said in a statement.
The ANA recommended that marketers use the guidelines as a starting point to understand the differences across social platforms in measurement definitions and calculations. It suggests advertisers communicate with media companies that they will be using the guidelines moving forward. And tell ad agencies that they will be using the definitions for campaign measurement and reporting.
The ANA moves come after the Federal Trade Commission voted in May to move forward with the update of its Endorsement Guides that would expand the definition of what would be considered an endorser, toughen review of social media posts, and fine-tune disclosures based on the audience targeted.
Among the revisions under consideration is changing the definition of endorser to also include virtual influencers that aren’t even real people. The FTC would also consider tagging a brand in a social media post as an endorsement. Labeling would need to be more “clear and conspicuous” and “easily understandable by ordinary consumers.” For audio ads on radio or in podcasts, for instance, the FTC says the disclosure would need to be in the ad’s audible portion.
According to Statista research from August 2021, influencer marketing is a $13.8 billion global industry, with growth projected to reach $25 billion by 2025. In 2021, influencer marketing spend in the U.S. was forecasted to reach an all-time high of $3.7 billion.
Read the ANA’s Influencer Marketing Guidelines HERE.