Industry matures through acquisition

Author: Scott Guthrie | #099 | 29 March 2023

This week’s newsletter is 1,900 words and will take around 7 minutes to ready.

Welcome to the Fourth Floor newsletter, your weekly feed of the biggest news, developments, insights, and analysis from the ever-evolving world of influencer marketing.

Influencer Marketing | Social Platforms | Fourth Floor | Quick Links | Column

ASA & CMA update ‘Influencers’ guide to making clear that ads are ads’

Now in its third edition, the ‘Influencers’ guide to making clear that ads are ads’ aims to be a best-practice guide on how to ensure that advertising content posted by influencers is clear about what it is. The guide is a partnership between the ASA and the CMA setting out:

• What the rules are.

• When content should be disclosed.

• Advice around affiliate marketing.

• How to make clear ads are ads.

• Visual examples of best practice.

• What happens if content isn’t disclosed.

CAP launches influencer marketing disclosure tool

The ASA’s sister organisation, the Committee of Advertising Practice (CAP), has launched a new online tool to help creators and marketers determine whether their social media content is advertising and should therefore be disclosed. This tool covers the main types of scenarios that you might face in deciding whether to label content as advertising, and links through to guidance which informs you about how to make that clear.

Influence is King

Blogosphere rebrands as bCreator

Blogosphere, the creator-focused awards and events company, has rebranded as bCreator. Founded in 2013 by Alice Audley, Blogoshere began as a magazine before expanding into a podcast and influencer network. bCreator takes the brand forward into a new era of the creator economy.

Ban-as-a-service conman ruining influencers’ livelihood

This ProPublica article is a deeeeep dive into scammers who trick Instagram into banning influencers. Ban-for-a-buck conmen who file bogus claims with Meta about influencer accounts aren’t new. We covered this area in the newsletter back in 2021. But the ProPublica piece highlights in great detail the process these fraudsters undertake, and the slow response from the social media platforms in reinstating the affected accounts.

Could ban-for-hire fraudsters spread to influencer marketing?

The story above explains how fraudsters are targeting creators to get their social media accounts unfairly banned. The same techniques could be used to unjustly have creator content removed. Last November, the CMA published compliance principles for protecting consumers against hidden ads. Principle 4 calls for social media platforms to “Make it simple for users to report suspected hidden advertising easily and effectively.” Without effective customer support and a rigid right to reply, influencers and their sponsoring brands could be negatively impacted.

Levi’s to use virtual influencers for improved ‘diversity’

Reports show that creators from minority backgrounds tend to be paid less, and are underrepresented in brand collabs. So it’s surprising that denim jeans powerhouse Levi Strauss & Co are to use virtual influencers to increase “the number and diversity of our models for our products in a sustainable way”. Levi’s has partnered with Lalaland.ai, a Dutch digital fashion studio that builds customised AI-generated models. It is, of course, debatable how useful the implementation of more diverse virtual influencers will be in elevating the careers of real ones.

Influencer Marketing | Social Platforms | Fourth Floor | Quick Links | Column

A TikTok ban would hit film studios and record labels

“A [TikTok] ban now would threaten not the livelihoods of TikTok’s biggest stars and thousands of small businesses, it could deal a massive blow to the entertainment industry, forcing movie studios, record labels, casting directors, Hollywood agents, and actors to radically shift the way they do business” - Taylor Lorenz, Washington Post.

How Germany’s public broadcaster uses TikTok

As TikTok bans spread from governments around the world to mainstream media (see last week’s newsletter, #98), it’s noteworthy to see how some journalists are still tapping into the platform. The Reuters Institute for the Study of Journalism carries an interesting article with Germany’s public broadcaster explaining how it uses TikTok to engage with younger audiences around the world.

Noteworthy: How Deutsche Welle and TikTok worked together to ensure sensitive educational content about concentration camps and the Holocaust wasn’t removed during moderation.

Quotable: “People on TikTok are hungry for information... We always hear about Gen-Z not being interested in the news, but young people really want to know how the news affects their lives”.

Twitch confused and upset its creators, says WaPo

In the last fortnight, Twitch’s long-term CEO Emmett Shear has resigned, its president Dan Clancy elevated to a CEO position, and the streaming firm has announced making 16% of its workforce redundant. The Washington Post takes a look at the contributing reasons for Twitch losing its way.

One reason Twitch stopped paying a premium for top talent: the firm didn’t think the creators had any other place to go.

Influencer Marketing | Social Platforms | Fourth Floor | Quick Links | Column

→ The UK rolls out its International Technology Strategy

→ Ofcom publishes its Plan of Work for 2023/24, outlining its areas of work for the next financial year.

→ YouTube to use AI to identify music trending with Gen Z, then bundle the tunes for advertisers buying across YouTube, YouTube Music, and YouTube Shorts.

→ Elon Musk values Twitter at $20Bn (he paid $44Bn for it five months ago).

Influencer Marketing | Social Platforms | Fourth Floor | Quick Links | Column

Acquisitions signal maturation of influencer marketing industry

A year ago this week, Arron Shepherd, co-founder of the Goat agency, told me on the Influencer Marketing Lab podcast: “You know, the size of WPP, it might be 30-40% of their business that is literally not fit for purpose in the next three or four years because they have been a very heavy analogue player. They make their money in analogue, and they haven't quite worked out digital yet”. This week the Goat agency was acquired by WPP.

Mark Read, CEO, WPP, said of the acquisition: “Influencer marketing is a key growth priority for the industry and for WPP. Our clients are increasingly planning budgets at a global scale and require partners that have the global reach to help deliver, whilst driving engagement and impact at a local level.

A few days after Goat, WPP acquired Obviously, a technology-led social influencer marketing agency. This time, Mark Read noted the speed and size of the creator economy’s growth, and said the sector now “plays a pivotal role in shaping consumer behaviour”.

Around two-thirds of marketers (65%) plan to increase their influencer marketing budgets in the next six months, according to Capterra’s 2023 Influencer Marketing Survey. The budget increases into our sector contrast with the reductions marketers are making to their overall marketing budgets in response to economic headwinds.

These acquisitions - and others, including Fanbytes to Brainlabs, and Village Marketing again to WPP - indicate that our sector has been sufficiently de-risked for ad holding agencies to take them on. It also suggests our industry is in transition from its fragmented opening phase to the next scale-up phase. This will be a time to expect major industry players to begin emerging, gobbling up competitors and forming empires.