Benefits of Influencer Marketing in Tourism

Table of Contents

1 Objectives and structure of the work.

2 Introduction.

3 Methodology.

4 Fundamentals of Influencer Marketing.
4.1 Definition Influencer and Influencer Marketing.
4.2 Development of Influencer Marketing.
4.3 Contact and procedure of Influencer Marketing.
4.4 Social media channels used for Influencer Marketing.

5 Influencer Marketing in Tourism..
5.1 Social Media Platforms in Tourism..
5.2 Examples of successful Influencer Marketing in Tourism..
5.3 Benefits and risks of Influencer Marketing.
5.3.1 Benefits of Influencer Marketing in Tourism..
5.3.2 Risks of Influencer Marketing.

6 Future perspective.

7 Conclusion.

8 Bibliography.

1 Objectives and structure of the work

The present work is divided into six parts. Following the introduction, which sets out the problem and objectives, the second part begins by explaining key concepts. Starting with the description of the concept of the term influencer and the idea of ​​different types of influencers, the development of influencer marketing as a communication tool, as well as the contact and the procedure is presented. Finally, the chapter discusses the social media channels used for influencer marketing.

Building on the knowledge gained in the second part, the fourth chapter explores influencer marketing in tourism. The reasons why influencer marketing has also gained in importance in tourism are given. Afterwards, the various social media channels will be discussed again and it will be shown which platforms are most frequently used in tourism. By way of illustration, various examples of successful influencer campaigns are listed below. Taking into account the lessons learned from the last chapter, the benefits of influencer marketing will be worked out in the next chapter. At the end of the case study, the findings are summarized and an outlook for the future summarized.

2 Introduction

"We can say with some confidence that the marketplace is not what it used to be. It is dramatically different from what it was even 10 years ago” (Kotler und Keller 2012, S. 34). Kotler and Keller describe the change of Marketing through the digital change. The demands of customers have changed. Corporate objectives are playing an important role as well. Globalization, progress in IT and Social Media are the challenges in this digital Marketing transition (cf. Kotler et. al, 2010). In earlier years, Marketing was focused on the product, later on the customer. Now, it is all about the values, which bring an emotional advantage (cf. C. Hilker, 2010). Due to the establishment of the internet as an everyday object, companies had to adjust their Marketing measures and concentrate on Online Marketing.

Nowadays, it is a decisive role for the image of a company to be represented on social media because it is one of the most important type of media in today’s time. The influence of traditional media is declining sharply. Companies thus loose the opportunity to reach their target groups via these older communication channels. At the same time, almost 80% of adults are online and are spending daily 166 minutes on average in the web (cf. ARD/ZDF Online Study, 2014). Consumers look at other consumers to inform themselves about products and services. This is why a new segment of Marketing has developed: so calledInfluencer Marketing.It is a trend topic and many companies deal already with it.

It became an integral part of the Marketing mix of companies. More and more companies are looking for suitable Influencers to advertise their own products and services to specific target groups on Social Media Platforms such as Instagram and Facebook.

Many tourism companies agree that Marketing of their offers is mostly online. But customers do not exclusively inform themselves online. Word of mouth from family and friends are still worth a lot. Consequently, the tourism companies cannot compete with personal relations. Nevertheless, there is an opportunity to work with bloggers and thus imitate the personal recommendation. Most tourism experts are already actively using social media and look, above all opportunities, for stronger customer loyalty, direct contact with customers, but also for addressing new target groups. Despite this awareness, quite a few tourism companies have set up cross-platform Marketing that advises customers both digitally and analogously, when making their travel decisions. No industry produces as more Influencer Marketing than tourism. The German National Tourist Board already felt confident in 2015 about Instagram as an “important factor in the distribution of content.” Since 2016, more and more industries are catching up. Influencer Marketing has developed from hype to a highly requested and approved Marketing tool.

The aim of the present work is to define Influencer Marketing and to work out the benefits for the tourism industry.

3 Methodology

Since Influencer Marketing has been officially recognized as a new form of Marketing for only a few years, there is limited scientific literature so far.

For this work, mainly studies and publicities of communication agencies, newspaper articles and literature of the most specialized in the field of Marketing, online Marketing and communication were used.

4 Fundamentals of Influencer Marketing

4.1 Definition Influencer and Influencer Marketing

Influencers are famous persons or persons who already have a certain status, for instance they have a big online community, especially on social media platforms such as Facebook, YouTube and Instagram. They are opinion makers, bloggers and have the necessary know-how in their relevant business, where their focus lies. Influencers express sympathy and authenticity in order to create higher credibility than traditional advertising tools (cf. Firsching, 2015).

Additionally, their so-called followers establish a personal relationship with the Influencers. Furthermore, Influencers are working independently and can be an ambassador for a brand or product. They give products a personal touch, create virality and produce the wish to potential buyers to own what they advertise for.

"Influencers are characterized by a particularly high network size and persuasiveness. Through their recommendations in social media, they can trigger communication cascades that influence the market success of brands and products as an electronic word-of-mouth. After all, many consumers are now consciously seeking contact with proven social web experts, before deciding to purchase a specific product” (Prof. Dr. Dr. Castulus Kolo, dean of Hochschule Macromedia, Munich). A definition of marketers J. Firsching and A. Bersch describes influencer marketing as: "The term influencer stands for people who can be seen as experts and opinion leaders about content, their communication, their knowledge and their reach" (Firsching / Bersch, 2016, p.3).

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Figure 1: Distinction between Influencers, Source: Own figure referring to Van der Nolk van Gogh, 2017

There is a distinction between Micro-, Macro- and Mega-Influencers, as shown in the graphic above. Micro-Influencers are characterized by a lower follower amount (1.000 to 100.000) but usually get a higher engagement rate than Macro-Influencers (100.000 to 500.000 followers) and Mega-Influencers (500.000 to 1 million or more followers), whereas Mega-Influencers may demand for a higher compensation for their efforts (cf. Van der Nolk van Gogh, 2017).

Built on the importance of Influencers on different social media channels, Influencer Marketing has developed. Companies hire Influencers to advertise their products or services with a picture on Instagram or a video on YouTube within the Influencer’s community. Influencer Marketing means the partnership with individuals who have a significant audience and influence in a specific client segment(Fischer, 2016). Companies manage to stand out from the crowd and convince customers of themselves and their product or services. It can have a decisive influence on the reach and popularity (Firsching, 2015).

4.2 Development of Influencer Marketing

The idea behind Influencer Marketing is not new, in early 20th century only a few brands were on the market and shaped product-oriented Marketing. These brands have already tried to influence consumers' buying decisions emotionally. Santa Claus is probably the most popular figure in the history of Influencer Marketing. “The Santa Claus we know today was made up by Coca-Cola and is far more than just a single-brand Influencer by now(Ehrhardt, 2017).”

The Christmas figure was created by brands in order to influence their image and help consumers remember qualities about the company. At that time, buying decisions were easy because of only a handful of brands in the market. With the expansion of product selection, Influencer Marketing was also taken into a new direction (cf. Ehrhardt, 2017).

The next step into the new marketing segment was advertisement through celebrities, which are famous for their “offline” career but still have massive online followers, but typically do not interact with fans (cf. Ehrhardt, 2017). One example is Selena Gomez, who is the most followed person on Instagram with 122.9 million followers. She was hired by the American brand Coach where she designed her own purse collection and posted pictures of herself with the purses on her Social Media channel (compare to Attachment 1). With the rising relevance of social media platforms, companies had to adjust their marketing measures in order to reach their target groups. Advertisement on Facebook or YouTube were now the new way to promote a product. In Germany, Influencer Marketing had its breakthrough in 2016 (cf. horizont.net, 2017). It creates a world of possibilities, where companies can connect with consumers more directly. Through Instagram, many personalities have received a high number of followers who were inspired by their photos and wanted to follow them in their everyday lives. The potential of this reach has been discovered by companies so that they have shipped their products as samples to the personalities for the first time. Meanwhile, not only the product is for free, the Influencers also require a fee if they post a photo or video of a product or service. The amount of the fee depends entirely on the reach of the Influencer. For example, Influencers with a reach of 50,000 followers earn about 500€ for an Instagram photo, whereas Influencers with a range of 500,000 already get four-digit amounts^[1].

When comparing the different ways of advertising, it quickly becomes clear that the internet plays a significant role nowadays and that companies already are investing in advertisements on the internet.

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Figure 2: Advertising turnover, Source: Own figure referring to horizont.net, 2017

This table clearly shows that Online Marketing is the most important tool, whereas television marketing and newspaper marketing lost importance, but still has a great share in order to address another target group, which are especially people over the age of 49, who are not using social media as efficient as the younger generation. A large share can also be seen for outdoor advertisement, like billboard advertising, street furniture or mobile billboards.

4.3 Contact and procedure of Influencer Marketing

Companies usually have the following models available for selecting and establishing contact with influencers. On the one hand, they can contact the influencers directly and thus establish a direct contact. On the other hand, companies also have the opportunity to contact an agency that establishes contact with the influencer. It is widely used to mediate through a multi-channel network, an organization that is joined by influencers to represent them to third parties and to seek support in the development of their social media profiles.

Over the years, the multi-channel networks have steadily become more professional and often have exclusive rights to commercialize influencers. If companies establish contact with the influencer via the multi-channel networks, the networks are involved in the revenues of the influencers, which are incurred as part of a resulting cooperation.

Another option is digital marketplaces, where companies advertise their campaigns and influencers report to the company if interested (cf. Wolf/Schmidt, 2017). Should there be cooperation between the company and the influencer, the digital marketplace is entitled to a commission. Once the influencer has been selected and the contact established, it is necessary for companies to convince the influencer to work with the company (cf. Uzunoglu/Kip, 2014). There are usually two approaches that have emerged over the years. On the one hand, companies can send a selected product to the influencer in the hope that the product will appeal to the influencer and then create a post on his social media profile about the product. This approach ensures that the contribution of the influencer is highly authentic and not influenced by any commercial interest on the part of the company. However, it also has the disadvantage that the influencer does not necessarily or in the worst case even report negatively on the sent product. The second option involves cooperation between influencers and companies in an official cooperation (cf. Grabs/Banour, 2017). It is hereby contractually agreed which content the influencer publishes in which way and at what time via which channels. In return for the publication of the contribution, the Influencer receives either a monetary remuneration, the advertised product is left to him or the cooperation offers the Influencer other advantages from the company.

4.4 Social media channels used for Influencer Marketing

For Influencer Marketing, several social media channels are being used. One of them isFacebook, which was launched in 2004 by Mark Zuckerberg in California. Since then, it has grown to the most important platform today and even 15 years ago, with 2 billion users (cf. Facebook, 2017). Particularly popular is the own Facebook page of an Influencer, which can be followed by users. Sponsored posts, video ads and banner ads are different advertising opportunities. The branded content tool can be used to determine the exact engagement rate and reach.

Meanwhile,Instagramis one of the best known and most used social media platforms. Instagram was launched in 2010 by Kevin Systrom und Mike Krieger in San Francisco and is mainly accessible through the mobile app (cf. Piper, 2012). In the shortest time, the social picture network has registered over 400 million active users per month (cf. Instagram, 2016). “Its user numbers have doubled over the last two years and are more than five times what they were four years ago”(Instagram Influencer Statistics, 2017). In Germany, 15 million people use the platform monthly (cf. Instagram, 2017). The main advertising opportunity here is especially through a post of a picture or video. A new feature of the platform is called “Instagram Stories”, where users can post a short clip, which is only seconds long and can be shared for 24 hours without appearing permanently on the users’ profile.

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^[1]Numbers are named from the author’s own experience, who is the personal assistant to the Influencer “Lebensgefühle”