Over the past few years, influencer marketing has become a significant channel for brands across the world. In fact, Business Insider speculated that influencer spending was expected to reach $8 billion in 2019 and $15 billion by 2022, and that’s only a year away.
With benefits like building trust, improving brand awareness, and creating partnerships, it certainly makes sense why it is becoming such a popular marketing method. Alongside this, handling everything online makes it much easier to analyze your data and effectively see your results.
By using social media handles such as Instagram, Twitter, YouTube, and TikTok, businesses have connected with many customers they may not have been able to obtain otherwise. According to Broadband Search, 11 people use social media for the first time every second, and the numbers just keep on rising.
Regardless of who your business targets, whether it be the youth or elderly, you can almost certainly find an influencer who creates content that resounds with and draws in your audience. From beauty and fashion to travel, sports, and fitness, the options are endless. However, there are some obstacles that make influencer marketing unappealing, and these can draw businesses away. Some of them include :
- Time consuming – With the vast pool of potential influencers in today’s digital landscape, it can be challenging to select the right influencer for your brand. Alongside this, with so many options (thousands even), sorting through them all can be overwhelming and take precious time away from other marketing areas.
- Influencer middlemen – Many influencers are signed under agencies, which tend to inflate prices and increased business costs while reducing the payout for their clients (influencers). This can then push the idea over your initial budget, which can be especially difficult for smaller businesses who are still establishing themselves.
- Determining the integrity and effectiveness of influencer campaigns – For businesses that haven’t used influencers before, it can be challenging to determine whether or not it will be beneficial. This is because you haven’t been able to fully see their work in action and have nothing to previously compare to.
- Barrier of entry – With reputation being the primary method in assessing the validity of the engagement, it can be difficult for smaller brands and new influencers to get their foot in the door. Follower count plays a big part in securing an agreement, which can be challenging for both parties who are only just starting their channels.
Luckily, we have a solution for every single one of these pending issues, and it’s found in two words: Blockchain Technology.
Blockchain technology explained
To explain in short, blockchain technology is a digital database that records information in a very secure way. This makes it very difficult to cheat, hack, or change the system. To go further, data (most commonly transactions) is stored on to each block, then chained together when filled. This then means, if someone wishes to hack the system, it is close to impossible, as they would need to change every block in the chain to avoid being detected.
To understand blockchain technology fully, you also need to learn about decentralization. This means that no one organization owns the chain, but instead, it is a distributed ledger via nodes, which connect to it. Those that are a part of it have a unique identification number that shows their transactions.
While it can be a bit difficult to understand at first, there are a variety of benefits that need to be taken into consideration. These include:
- Greater transparency: The open transaction ledger for public addresses promotes a layer of accountability.
- Increased efficiency: With no “middleman,” transactions are faster, and there is a reduction in transaction costs. With such a secure system, there are also lower systemic risks than other digital databases.
- High level of security: The system is one of the most safe, with effective monitoring and auditing of transactions that make it tamper-resistant and secure.
- Improved traceability: Various goods and services can be easily tracked to verify both manufacturer and distributor’s authenticity.
Blockchain technology for influencer marketing
The sure-fire security of data within a blockchain provides a mutual benefit for all parties- both the influencers and businesses. With information and metrics about each influencer and their audiences readily available, advertisers no longer need to spend hours and hours searching for the right influencer that resonates with their audience and brand guidelines.
On the other side, Influencers no longer need to rely on their reputation that their contracts will be paid. With the data at hand, all parties can see all the prior actions and make decisions accordingly. After an agreement is reached between an advertiser and an influencer, both parties can rest assured knowing they will both get what they are promised through the use of smart contracts.
Smart contracts in influencer marketing
Blockchain technology enables the use of smart contracts to hold funds in an escrow and ensure that payment is made after the influencer campaign is complete. This guarantees the interest of both parties and removes the component of any disputes that may come about from the campaign. This also addresses the problem of scams and frauds within the industry that can be quite problematic.
In addition to settling disputes, a centralized influencer marketplace will also cut out the need for middlemen and agencies and instead connect influencers and advertisers together in a streamlined platform. Whereas businesses may have been hesitant to make the jump due to the uncertainty of ROI, smart contracts will ensure verification and tracking of the engagement.
Pushing smart contracts into the influencer ecosystem will only help legitimize the channel and allow it to grow. Raiinmaker is an upcoming mobile influencer marketing platform that provides influencers of all sizes the opportunity to share passions, ideas, or businesses from prelaunch to market and earn rewards immediately for sharing these projects. It’s the perfect place to start for companies who are considering getting started to enjoy the various benefits they can bring.
When taking into consideration all of the above, it’s easy to see the many benefits of smart contracts for both businesses and influencers alike. While it will certainly take some getting used to, like most new digital ideas, it opens up a new world of safety and security. It takes out the hesitation that both parties face, from scams to campaign disputes.
With more and more individuals coming on board, the further potential that this industry has to grow. What do you think? Will smart contracts be the future of influencer marketing?
Salvatore Presti is an American writer living in Italy who enjoys the fine art
of living well. His interests include anything wine, food or nature related
especially when enjoyed with friends and family.