#Sponsored; How should wine brands collaborate with influencers, and what’s the point?

How should wine brands collaborate with influencers, and what’s the point?

By Dr Rebecca Dolan, Senior Lecturer of Marketing and Wine Business Program Director, Adelaide Business School, The University of Adelaide

Introduction

The wine industry is recognising the increasingly relevant role of digital marketing as a valuable and appropriate tool to reach and engage with consumers. In this session, we will delve into one specific marketing tool being used in the digital space by an array of brands: influencer marketing. Specifically, we discuss the notion of influencer marketing effectiveness which we describe as when brands and influencers work together to achieve consumer acceptance of a brand message (e.g., a social media post), and enhanced brand engagement. To understand and predict influencer marketing effectiveness, we’ve researched several key factors that can leverage success. These include: understanding the importance of the relationship that an influencer builds with their follows, heuristic cues including popularity and physical attractiveness, how a consumer perceives an influencer in terms of their trustworthiness, expertise, similarity and respect, and finally, the importance of having an authentic brand. Combining these key considerations allows us to give clear guidance on selecting suitable influencers for your brand and predicting success concerning enhancing consumer engagement with your brand.

The rise and rise of influencer marketing

Instagram, Facebook, TikTok, Snapchat, WeChat and many more platforms give social media users a chance to share their passion for wine and inspire us with wine tasting moments and experiences. These people might be specialists, experts, media personalities, or just everyday consumers who love talking about wine. In recent years, some individuals have created powerful online personas, coupled with active roles in disseminating information and opinions, enabling them to influence consumer decision making. Recognising this influence, social media users and marketers alike have found a way to monetise their online success. Hence, the rise of #sponsored social media content and paid partnerships, dominating our social media streams. Recent estimates suggest that over US$8 billion were spent globally in 2020 on Instagram influencer marketing alone. Other research indicates that influencer budgets range from $1000 a year to $500,000 per year!

Globally, the wine industry has followed suit with embracing influencer marketing to target a community of both novel wine consumers and wine enthusiasts. In China, well-known beauty influencer Li Jiaqi sold 20,000 (6 bottle) cases of GreatWall’s red wine in just 30 seconds during his live stream of the tasting. Similarly, in another collaboration with Jiangxiobai, a Chinese distillery of Baijiu in southwestern Chongqing, Li Jiaqi sold 200,000 bottles of plum wine within minutes of the live stream. Back on home soil, Peter Lehmann Wines have used influencer marketing to capitalise on moments of wine consumption and inspire influencers’ audiences, collaborating with Montreal-based Canadian influencer Audrey Rivet in 2018, who now boasts an impressive 182,000 followers. Similarly, Bird in Hand has collaborated with celebrity influencer Bec Judd. She posted a series of photos on her Instagram page consuming the product and using the hashtag #partner or #rjpartner.

So what exactly is an influencer, and what is ‘influencer marketing’.

We define influencers as a third party person to the consumer-brand relationship who has established a significant number of meaningful relationships with consumers and collaborates with brands to deliver desired  outcomes. TRIBE, one of Australias largest influencer marketing agencies connecting brands with over 75,000 influencers, define influencers as someone with 3000+ genuine followers on one of three partner platforms (Facebook, Instagram or Twitter). Influencer marketing involves a brand collaborating with an online influencer to market one of its products. Depending on the influencers’ size (number of followers), the frequency of their posts promoting your products, the style of the posts (photos, videos, live stories), influencers will charge a promotion fee. For some influencers, the cost might be in the form of free products rather than a payment. Some industry guides estimate that the benchmark for Instagram influencers begins at $150 per post (influencers with 3,000-10,000 followers), right up to $680 per post for over 100,000 followers. Comparatively, on TikTok, average prices vary significantly; however, the general price guide is estimated at $25 per post, per 1000 followers. Several questions arise when considering influencer marketing as a tool for your wine brand. These will be outlined in the following section. Firstly, how do I choose an influencer to collaborate with? Secondly, what are the benefits? And thirdly and very importantly, what rules and regulations should I be aware of?

Should you jump on the bandwagon? If so, how?

Despite the emergence of influencer marketing and considerable investment in this tool, surprisingly, there is little known about selecting an influencer, outside of the standard recommendations of looking at their number of followers and the fee charged per post. Further, there was little empirical evidence suggesting that influencer marketing can drive the desired brand outcomes. This realisation led us to conduct an empirical study of influencer marketing effectiveness. We surveyed 281 consumers who followed at least one influencer and had observed a brand-endorsed influencer post in the two weeks before completing the survey. Drawing upon celebrity endorsement and influencer marketing literature, we investigated a range of critical constructs. These included: perceptions of influencer physical attractiveness and popularity, the consumer-influencer relationship as perceived by the consumer, influencer efficacy characteristics of trustworthiness, respect, similarity, expertise, and outcomes of brand authenticity, brand engagement, and attitudes towards the post. Using a statistical technique called partial least squares-structural equation modelling (PLS-SEM), we explored several predictive relationships between these constructs. Our results provided some interesting insights regarding the characteristics that wine brands should look for when selecting an influencer, as we discover that these characteristics play a significant role in facilitating perceptions of brand authenticity, brand engagement, and attitudes towards
the post.

Firstly, our statistical analysis tells us that the characteristics of influencer respect, trustworthiness, similarity and expertise are central in facilitating brand authenticity. This is important to consider, as our research also showed that popularity and physical attractiveness are separate, heuristic cues. Therefore, choosing an influencer based on their number of followers (popularity) or physical attractiveness is insufficient. The second important finding from our study is that the consumer-influencer relationship has a significant role in driving the desired outcomes of brand authenticity, positive attitudes, and brand engagement. This means that you should carefully assess how they manage their relationship with their followers when selecting an influencer. This could be identified by determining how often they reply to their followers and engage in conversations. A suitable example would be an influencer who frequently responds to follower comments left on their social media posts and often uses social media tools such as ‘live’ stories to engage with their audience directly. We encourage brands to adopt influencers who demonstrate an appreciation for building and maintaining relationships with their followers. A further important consideration is the necessity of disclosing the sponsorship, or paid partnership, to allow both the influencer and brand  to be seen as open and honest. Our research indicates that allowing  influencers to express their genuine opinions surrounding a brand’s product or services builds the influencer’s trust and credibility, which indirectly enhances perceived brand authenticity. Brands should be proactive in facilitating interaction between the influencer and the consumer and developing a plan with the influencer that allows for branded content to be discussed across several platforms to enable real-time interaction and engagement.

Our research found an interesting pathway of relationships within the constructs we investigated. In statistical terms, we call this a ‘sequential mediation model’, which is a fancy way of saying that one thing leads to another. Essentially, our model showed that the strength of the relationship between a consumer and the influencer leads to enhanced perceptions of the influencer (their trustworthiness, similarity, level of respect and expertise), which leads to a heightened perception of brand authenticity, which leads to increased brand engagement and more positive brand attitudes. Understanding these relationships helps us to answer the question of whether or not brands should use influencers. Put simply, the answer is yes, if you have the goal of enhancing perceptions of brand authenticity or enhancing brand engagement (e.g. consumers talking about your wine, thinking about your wine, recommending it to a friend, etc.). When we say brand authenticity, this is defined as consumers’ perceptions of consistent and appropriate behaviour by the brand and its genuineness in its relationships with consumers. Going back to the example of Bec Judd and her partnership with Bird in Hand, using our model, we’d expect to find that if Bec establishes a strong sense of relationships with her followers, this should enhance the extent to which she is seen as trustworthy, respectful, similar and an expert. These perceptions create favourable brand authenticity for Bird in Hand, resulting in consumers having stronger engagement with Bird in Hand and positive attitudes towards social media content from Bird in Hand and Bec Judd. Worth noting, however, is that the reverse is possible. An influencer involved in a scandal or undesirable behaviour can elicit negative perceptions of trustworthiness, respect and so on – damaging authenticity and engagement for your brand. Therefore, it’s important to carefully consider the current public perceptions of an influencer you may collaborate with.

Proceed with caution

There are some essential regulations and rules to keep in mind when thinking about adopting an influencer marketing strategy. In 2019, several influencers came under fire from an investigation by VicHealth. Alcohol products, including branded glasses, bottles of Champagne and wine, were used as props by influencers. While the influencers used the brand’s official hashtag and handle, VicHealth stated that a concerning amount of posts did not disclose that the post was a paid endorsement or sponsorship. Interestingly, it’s difficult for regulators to prove that companies are paying influencers. The only way to know for sure if an influencer has been paid for an alcohol brand to promote their products is if they declare the brand publicly discloses it. This raises concerns when considering that many influencers may be popular with a younger audience, giving rise to ethical questions such as whether the alcohol industry is using social media as a tool to promote products to a potentially underage and impressionable audience who may not understand that they are being sold an ad.

All marketers considering an influencer marketing campaign should be advised by the current guidelines under the Australian Influencer Marketing Council (AIMCO). In July 2020, AIMCO released an Influencer Marketing Code of Practice to ‘build greater transparency and trust for the industry’. The Influencer Marketing Code of Practice clearly articulates the areas of responsibility and proposed requirements for all involved in the influencer marketing landscape. It also includes guidelines on influencer vetting, advertising disclosure and contractual considerations, including content rights usage and reporting metrics. Who does the Code of Practice apply to? Anyone working in the Australian influencer marketing sector, including talent representatives and managers, industry marketplaces that promote/provide influencers, media and PR agencies, advertisers engaging industry participants for influencer marketing and platforms and service providers to the influencer marketing community. When is advertising disclosure required? Advertising disclosure is required when there is a contracted agreement. The contracted agreement includes any transaction with financial payment and value in kind, gifts and free products. Influencers must meet the minimum disclosure in their posts of using #ad or #sponsored. However, the Code of Practice states that #ambassador, #collab and #paidpartnership hashtags are advised but not mandatory. Whilst this information is current at the time of publishing, we strongly recommend that all wine marketers check the most recent guidelines, including the Australian Influencer Marketing Code of Practice (www.aimco.org.au/), the AANA Code of Ethics (aana.com.au), before considering an influencer marketing campaign.

Acknowledgement: The author would like to acknowledge Dr Dean Wilkie, Senior Lecturer of Marketing at the University of Adelaide, who collaborated on this study, and the Adelaide Business School who funded the study.