Build Trust Before The Influencer Marketing Bubble Bursts

Sunday Dec 29th, 2019

Female Influencer Blowing Bubbles

An interview with Zak Stahlsmith, CEO of ApexDrop

Yes, there are fake influencers.

Yes, trust in influencers is waning.

And yes, paying a person for their thoughts can lead to biased reviews.

Zak Stahlsmith believes the “influencer marketing bubble” is about to burst for the above reasons. Yet, he welcomes the correction as it will strengthen the industry.

In this age of fake influencers, high-quality content creators will survive. Artists will continue to inspire. Popular opinion leaders will continue to change our minds. 

Perhaps we stop calling these people “influencers” and redefine the industry. 

Question: Describe the current situation with fake influencers and shrinking consumer trust.

Zak Stahlsmith: The issue of fake influencers has been brewing for the past five years. When you pay influencers based on their number of followers, there is an incentive to boost this number artificially.

The “influencer marketing bubble” is about to burst. 

It needs to burst. We should be rejecting fake influencers and fake reviews. When you pay people to say things, you introduce bias, and their audience loses trust. That's the current state, and it stems from paying people to leave reviews.

It seems like there are more phony influencers than there are real ones. The recent Wall Street Journal article highlights the problem—but it’s not a new problem.Wall Street Journal article about fake influencers

Image Credit: Wall Street Journal

 Q: What resonated with you with that Wall Street Journal article?

ZS: The consumer sentiment now is, “I'm sick of being sold to.” What do they want instead? People love to discover. People love to buy. But, they hate to be sold to.

Yes, consumerism is part of our culture in America. But we're pushing back against constantly being sold to. As consumers, we want to find products and decide if we should have them. That's why we initially loved influencers—we trusted influencers. They helped us discover. Then all of a sudden, we stopped trusting them.

Q: Did you disagree with anything in the WSJ article?

ZS: People do not need to be paid to talk about things they love. This article clearly didn't get that. Rather, it focused on the horror stories related to paying people to talk about a brand: “I paid someone to talk about my product, and they didn't make me enough money. So I quit.”

This article doesn’t recognize the one consistent variable of each horror story: “I paid them to say stuff, and it didn't work.”

Of course it didn’t work! 

Frankly, the article is old news. Fake influence has been an issue for years, and now this information is finally catching up to the Wall Street Journal.

To avoid this issue of fakes, many marketers are switching to trade collaborations. That's what my whole company is based around.

Q: What trends do you see with the state of influencer marketing right now?

ZS: Brands are moving toward trade collaborations, instead of paid collaborations. With trade collabs, also called product gifting, influencers are compensated with your product, not cash.Women with dog

Trade collaborations can be insourced or outsourced.

When managed in-house, brands often struggle to build and maintain relationships with influencers as they scale their campaigns. On any given campaign, you might have to manage 50 to 100 content creators, and then organize their content and keep track of their KPIs.

Because building relationships is difficult, many brands align with only a few influencers. The problem is, those influencers burn out. Brands beat their influencers to death by making them post about the same product for months. Influencers aren’t salespeople. They’re artists.

Outsourcing trade collabs works really well. That's why I'm in that space. In the outsource model, the agency rotates through a variety of influencers, so everybody stays interested, happy, and engaged.

Q: What else struck you about the article?

ZS: How we measure results and our expectations of influencer marketing has to change. Brands have to understand we're sending products to a person to review.

Brands need to delight an influencer the same way they would a customer. Give them awesome products, and your stuff will take off. Don’t obsess over how many sales you got from a single influencer’s post. You cannot directly correlate sales to authenticity and discovery.

Instagram is meant to be a place where people hang out, where people enjoy each other's posts. There's always been staged content, but it didn't always feel we were being sold to. Staged photos aren’t bad: “Oh, here's a happy fluffy photo from somebody I know. Obviously they waited for the perfect moment to snap this picture, but it looks cool and informed me of something interesting.”

But when people started taking money from brands to post about products, the waters were muddied. The FTC started cracking down. Suddenly everybody became an influencer, and our feeds filled with sponsored post after sponsored post. People got sick of it.

Brands are starting to see the dark side of influencer marketing. They’re realizing when you pay influencers, the content is biased and inauthentic. This realization is actually really good for my business model.

Q: Do you think there's also an issue of how we’re defining influencers?

ZS: Yeah, I’ve said it before, I hope that the word influencer dies a terrible death and then just disappears. The term makes it sound like these people were born influential, and everything they do is influential.Male fashion influencer

Let's be real. They're artists. They are content creators. They influence people—but not everything they do is influential. Yet, that's kind of what you claim by calling someone an “influencer.”

My point-of-view is the definition of an influencer should change, and the label should change. 

I think they should be considered artists.

I also don’t think paying influencers is necessarily bad; paying an artist to create something isn't unheard of. It's just—what's the intention of that art? If you pay an artist to create a piece for a museum, that’s different than if you paid an artist to create a piece that misleads people into believing he or she likes something. It's deceiving.

Q: If you could redefine influencers, what would you call them? 

ZS: Artists that inspire people.

Q: How should brands work with influencers?

ZS: Imagine trust in the form of little pellets. Influencers have tons of these pellets in their trust boxes. They’ve worked hard to earn that trust. Now, a brand says, “Hey, I'd like to buy some of your trust pellets.”

Influencers say, “Okay, I'll give you a few trust pellets.” 

They think, “It’ll be okay. I’ll just sell out a little.” 

Brands keep paying influencers for their trust pellets. Influencers—not realizing they’re running out of trust pellets—keep giving up more creative control until their audience stops caring.

But smart brands started asking, “Hey, how about I get some trust pellets, and you get some too?”

That's good influencer marketing. Influencers maintain their creative control, and brands get exceptional content, marketing insights, engagement, and an array of other benefits. That’s a healthy relationship.

Influencers and brands should help each other grow. But is the best way to measure the value of this relationship through sales? You're not going to make a fortune on one post. Let's just get real.

But that's what some marketers are looking for. Everybody is obsessed with these interactions directly leading to transactions. 

Six amazing values— distribution, engagement, insight, return on relationship, user-generated content, and sales lift—from this relationship, and everybody is focused on the one that screws the whole thing up: sales.

So, the Wall Street Journal says there’s no trust in influencers anymore. No shit, Sherlock.Instagram model
Q: Can trust be rebuilt?

ZS: Once it’s depleted, it’s exceptionally challenging for influencers to get back. The time to be concerned about trust is before you lose it. Trust can be an infinite resource. You can build it together with brands as long as you keep doing the right thing.

When brands try to buy trust instead of just focusing on great products, and when influencers keep selling their trust, those trust boxes are depleted.

Q: Tell me about how ApexDrop does influencer marketing differently.

ZS: I love symbiotic relationships. I like win-win-win-wins, a quadruple win. If you can do that, you're making this world a better place, and I’ve found a way to do it. The brand wins, the influencer wins, the follower wins, and the agency wins.

And let me be clear, you need an agency. If you're going to do this right, you need someone to set the relationship straight and have both journalistic principles and a code of ethics that's built into their system. Nobody's doing that.

A quadruple win is the only way that'll make this whole industry go back to where it should be. Influencer marketing will die unless we all switch to the quadruple win. I would like to flip the influencer industry upside down, and change it for the better, because it's about to self-implode.

Q: How can influencers be incentivized to only review products they genuinely like?

ZS: That's impossible, because there are always going to be celebrities. There's always going to be someone getting paid to say something they don't necessarily believe. Celebrity marketing exists. As soon as money gets involved, people feel pressure to endorse products. That's where the deception comes in.

The only way to remove deception completely is to stop paying influencers. 

Then, the only way to remove bias is to encourage them to only post about what they love and give them an “out” if they don’t like the product. 

Until you've given the influencer full creative control where they can say “no,” you don't have reality, you have a biased view.

Q: How do you give influencers an out if they don't like a product.

ZS: It's not complicated. We say, “Hey, if you don't like it, tell us why. We would love to hear about it privately through a survey.” That's it. But if they feel the need to make their thoughts public, we can't stop them. They are allowed to talk about the product negatively.

I've been doing this for five years. Over 100,000 applicants to our influencer network, over 15,000 active influencers in our network today, and not one of them has ever said anything bad about a product publicly. Why?Women wearing glasses

Because we encourage their feedback whether it’s positive or negative. They respect the fact that both Apex and the brands want to hear what we can do better. For brands, this isn’t just feedback; this is important constructive criticism from ideal customers.

So, brands listen to these influencers. That feedback is one of the most valuable aspects of an influencer campaign.

Q: It's so simple. Why can’t everyone do this?

ZS: It's an awkward conversation for a brand to reach out to an influencer and vice versa. It’s exceptionally difficult to manage all of those relationships, and it’s challenging to forge that mutual understanding between content creator and brand.

That’s why businesses find agencies to do it for them. That's literally what ApexDrop does.

We create an understanding and remove the awkwardness between brands and influencers. Working with an agency also gives brands the comfort of knowing that every influencer in our network is meticulously vetted.

Q: As soon as you add money into the mix, things get murky. But there’s another issue: Being an influencer is “cool.” Cool is compensation enough for some people.

ZS: There is a certain amount of “cool” that comes with being sponsored and saying, “#Nike, thanks for sending me these free shoes.”

I have a 17-year-old son, and I asked him, “What do you think of all these people you follow on YouTube and Instagram selling out?” He goes, “What do you mean? Like sell out all of their merch?”

I go, “No, I mean, like, they sold their soul.” He goes, “It’s cool to have sponsors. They’ve made it.” He doesn't think they’ve sold out! So, I’m less worried about the “cool factor,” as long as the content remains authentic and high-quality.

Q: So, it’s really an issue of transparency?

ZS: Yeah, exactly. There's no deception. That's it.

There are always going to creative people that others like to listen to, and that's great. We want to help them talk about things they love. If you’re a brand, gift them a great product. It shouldn’t be more complicated than that.

If you’re a brand looking for someone to say exactly what you want them to say, find a celebrity. That’s an ad, not influencer marketing. There is nothing wrong with that, but the relationship needs to be transparent.

I don't think Peyton Manning or Nationwide lost trust when he began working on those insurance commercials. People laughed. Peyton probably gained some trust because it was so obviously an ad.

We hate fake news. We're sick and tired of fake people, fake Presidents, fake government, fake, fake, fake. Come to think of it, let's just call it the “fake bubble,” not the “influencer bubble.”

Build Trust with Trade Collaborations

If you’re searching for volumes of high-quality content from trusted creators, artists, and thought leaders, you’ll find it an ApexDrop campaign. To learn how we can help your brand, schedule a quick chat with our brand strategists.

About Zak Stahlsmith

Zak Stahlsmith founded ApexDrop Influence Marketing in 2014. As one of the pioneers of influencer marketing, Stahlsmith tested a variety of methods and quickly discovered the best long-term results with micro-influencers and a trade collaboration model. Today, ApexDrop maintains an extensive network of micro-influencers and nano-influencers who are compensated with product gifts only and offers one of the most cost-effective and easiest ways to produce influencer content in bulk. Learn more about ApexDrop.