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UNIVERSITY OF NEW YORK IN PRAGUE
European Business Administration
An Examination of Marketing Strategies and their
Added Value of using Digital Influencers to
establish new customer relationships and loyalty
among Generation Y
by
Lineta Lúčanská
2016 Mentor: William Pattison
This thesis is dedicated to my beloved parents and my amazing brother
for their endless love, support, encouragement and inspiration.
Statement of Originality I, Lineta Lúčanská, hereby declare that the material contained in this submission is original work performed by me under the guidance and advice of my mentor, William Pattison. Any contribution made to the research by others is explicitly acknowledged in the thesis. I also declare that this work has not previously been submitted in any form for a degree or diploma in any university. Lineta Lúčanská May 6th, 2016
Table of Contents
ABSTRACT....................................................................................................................................... 1
INTRODUCTION ............................................................................................................................ 2
Statement of the Question .................................................................................................................. 2
Personal Intent ........................................................................................................................................ 2
Target Audience...................................................................................................................................... 3
Consumption of social media ............................................................................................................ 7
INFLUENCERS ................................................................................................................................ 9
Current state of social media............................................................................................................. 9
Added Value of Influencers ............................................................................................................. 10
Fashion and digital influencers ..................................................................................................... 14
Business model .................................................................................................................................... 15
Harvard Business Review Case study......................................................................................... 17
SOCIAL MEDIA ............................................................................................................................ 23
Facebook ................................................................................................................................................. 23
Snapchat.................................................................................................................................................. 24
Instagram ............................................................................................................................................... 31
PRIMARY RESEARCH ................................................................................................................ 34
Interview with Online Marketing Specialist ............................................................................ 34
Interviews with Companies ............................................................................................................ 35
Social Media Influencers .................................................................................................................. 39
Consumers ............................................................................................................................................. 39
CONCLUSION ............................................................................................................................... 43
APPENDICES ................................................................................................................................ 45
Works Cited ................................................................................................................................. 48
ABSTRACT
This body of work is an in-depth combination of primary and secondary research
addressing marketing tactics on social media. The thesis evaluates added value and
effectiveness of using digital influencers in order to develop and maintain relationships
with millennial women. The target audience is defined in great depth in order to
introduce the missing understanding of the market and lost profits since many
businesses have lead unsuccessful social media campaigns. The paper identifies
Facebook, Instagram, and Snapchat as primary vehicles to reach the respective target
audience. Harvard Business Case Study and other findings have supported the
unprecedented effectiveness and value of digital influencers. After extensive secondary
research, a number of semi-structured interviews were conducted in order to examine
how companies approach the subject and what their knowledge is. Further support for
relevance of using digital influencers was found in primary research with a sample of
millennial women. All findings supported the premise and lead to conclusion that online
presence is crucial for success of any company and digital influencer are invaluable
asset to the mix. Digital Influencers using social media vehicles such as Facebook,
Instagram, and Snapchat proved to bring invaluable added value for companies, have
demonstrated substantial effectiveness and proved to bring qualitative return on
investment in terms of relationships and loyalty.
1INTRODUCTION
Statement of the Question
The research paper aims to examine, measure and evaluate specific marketing efforts in
terms of added value, effectiveness, and return on investment. Marketing efforts that are
examined are the various uses of social media personas via three specific social media
platforms, namely Facebook, Instagram, and Snapchat, to reach customers of
Generation Y within lifestyle and fashion industry in the United States of America.
Social media personas taken into account for the purpose of this paper are solely
individuals who did not gain their follower base, recognition, and popularity on any
mainstream media, however, solely via internet. Therefore celebrities with large social
media fan base are excluded as influencers from the examination.
Personal Intent
As a digital native, born in 1993, my touch with technology was in times of Web 2.0.
Generation Y (or Millennials if you will) have largely been part of Horizontal
Revolution. Millennials represent a large, however, challenging target market, since
they have highly generation-specific consumer behaviors. They tune out most of
traditional advertising, or whatever they consider a marketing effort, and tend to
connect better with people than companies. That being said they are much more likely
to react positively to brand ambassadors opposed to advertising. In terms of delivering
higher value or overall experience rather than plain product, they are more demanding
and establishing a relationship with them becomes increasingly challenging compared
to any other generation. On the other hand, they are loyal. This leads me to the
2hypothesis that Generation Y would be best addressed on social media through brand
ambassadors and digital influencers. Millennials in the United States of America are
known for being almost constantly online. While being on social media they consume
mostly peer-created content. Social media shapes wants and needs in Millennials and
represents major drivers of trend for this particular group. My intent is to examine
marketing impact of Online Brand Ambassadors on following social media: Facebook,
Instagram, and Snapchat. I will attempt to illustrate and evaluate their influence and
whether or not they bring added value to companies that hire them. Information and
assumptions provided in this section are an illustrator of what is discussed and heavily
supported in the rest of the paper.
Target Audience
Target audience that is examined in the research is Generation Y, commonly referred to
as Millenials. William and Neil, most often cited source on the topic, define the
Millennial cohort as consisting of individuals born between 1982 and 2004. Millennials
represent a market of “76 million Millennials in the United States” (Haughn, 2015).
According to Egan, this represents one-fourth of population of United States and
represents purchasing power of 1.3 trillion dollars. Haughn claims that they are
perceived as the most ethnically diverse and most tolerant generation. Generally
speaking they tend to be positive and confident, some say to a verge of dilution, self-
entitlement and narcissism. Well-defined target audience is a first element of building
marketing strategy, in order to examine the appropriate manner in which target audience
is reached, there is a need to be very precise. Target audience that is a subject of the
examination in this paper is geographically defined as United States. Evaluation of
3social media marketing strategy effectiveness is primarily focused on females. The
examined industry is represented by lifestyle and fashion brands.
Millennial Women
Jeff Fromm provides insights on nature of millennial women in his article Marketing to
Millennial Women, “[they] are brand influencers and share their opinions with friends,
family and their online communities. A majority of social media outlets are
predominantly female users. Women value relationships and seek out brands that allow
them to connect with each other. Engagement is a phrase that has been consistent in
discussions about Millennials. Women especially want to be included in the
conversation instead of being told what to do or what to purchase. When marketing to
millennial women, it is important to realize that they are a demographic of their own
and value inspirational messages, interesting visuals and the opportunity to voice their
opinions.” Fromm further explains that they are cause-driven, highly value creative
expression, are image-based, and pass on their brand loyalty. They essentially become
brand ambassadors themselves, especially within communities of other women and
their households. However, according to Daniel Newman, many companies fail to
further dissect the Generation Y, he claims that substantial messaging targeted on
Millenials is male-centric or “bro-based”. Newman further explains that, “millennial
women’s relationship with brands reveals today’s female consumers demand
significantly high levels of engagement from brands. Are they getting it? No. This is
where brands are ignoring billions of dollars in potential revenue opportunities”
(Newman, 2015). While Millennials as a whole “like to associate themselves with
difference-making brands, causes, and trends”, the female Millennials want to be
inspired by the brands, and seek engagement with positive brand images. Newman
concludes that, “brands that want to attract the attention of the millennial woman need
4to layer their campaigns with inspirational messages.” The importance of recognition of
this market is closely tight to emerging demographic changes and roles of women in
society. Breaking the female stereotype is important in order to be able to initiate a
relationship with Generation Y women. Heather Huhman describes the majority of them
to be, “known for being highly ambitious, educated, optimistic, dedicated, and are
attempting to thrive in a well-rounded lifestyle. These reasons alone make female
Millennials powerful players” (Marston, 2014). “With well-paid jobs, more spending
power, and better lifestyles, women are an emerging financial force. Brands that
leverage this group are sure to compete more profitably in the near future” (Newman,
2015).
Millennial Values
Ability to reach millennial audience lies in understanding of its values. The study
conducted by NewsCred in Fall 2014 has revealed that 62% of US Millennials “feel that
online content drives their loyalty to the brand.” However, their attention span is limited
and if they do not connect with the content of the brand they quickly loose interest since
they are constantly exposed to enormous amount of content. Millennials are exposed to
over 3000 marketing messages a day, therefore, they only respond to content they find
of value. According to News Creed survey, to be able to grab millennial attention and
have them respond positively to the content, the content has to be fairly targeted. 54%
said they respond positively when the content is tailored to their age, 55% respond
positively when the content is relevant to where they are, and 63% have positive
respond when the content is relevant to their cultural interests. In addition, Millennials
have high expectation of the quality content, on one hand 64% respond to useful
content, while on the other hand, 30% refuse to read content that does not entertain or
5educate them. According to NewsCreed finding, 31% of Millennials “are more likely to
respond if the brand delivers interesting content that teaches them something.
Millennials as consumers are conscious about their purchases, “33% of millennials rely
mostly on blogs before they make a purchase, compared to fewer than 3% for TV news,
magazines and books (Elite Daily, 2015).” This supports the premise that they do not
trust advertising, “only 1% of millennials surveyed said that a compelling advertisement
would make them trust a brand more” (Elite Daily, 2015). In summary, the content that
has a potential to grab attention is social media content that is cause-driven (50%
positive response), thought-provoking and intelligent (60% positive response), or funny
(70% positive response). Cause-marketing they respond to includes, “issues like
sustainability, LGBT equality, animal rescue, or helping the poor, to name a few”
(NewsCred, 2014).
Marketing strategies serve as means of communication between companies and
potential customers. However, the communication channels for Millennials are very
specific and different from what we would call traditional advertising. As so-called
hyper connected generation, their access to information, views on products and
spending patterns largely differ from previous generation. David Arabov, CEO Co-
founder Elite Daily, addresses their research, “our findings confirmed that millennials
are highly educated, career-driven, politically progressive and, despite popular belief,
do indeed develop strong brand loyalty when presented with quality products and
actively engaged by brands” (See Appendix A, p. 45). There is a tremendous potential
for companies to develop long lasting relationships with Generation Y since, according
to Elite Daily study, they have a tendency to be loyal customers.
6Consumption of social media
Millennials consume social media predominantly on mobile devices. Whopping 97% of
Millennials used mobile devices for social networking in 2014 (Statista, 2014). There is
a significant shift from desktop social media consumption towards mobile, especially
for Millenials. Nielsen 2014 statistic shows that women spend 89% (See Appendix B, p.
45) their time on media through mobile apps compared to mobile web. eMarketer
published a statistic saying that in 2015 51% of digital media was consumed via mobile
device compared to only almost negligible 12% of 2008 (See Appendix C, p. 46). The
shift of general public consuming any form of digital media towards mobile is fast and
significant and shall not be overlooked when creating any marketing campaign. This is
especially significant for millennial demographic since the most popular social media
they use are designed as apps rather than a desktop platforms and benefit from
immediacy and technological advancement. Most popular social media apps among
Millenials are Facebook (76,6% of all smartphone users), Instagram (43,1%), and
Snapchat (23,8%) (See Apendix D, p. 46) .While Facebook still has desktop
engagement (32% of all American social media consumers), Instagram (98%), and
Snapchat (100%) are almost exclusively used via mobile (See Apendix E, p. 47). As of
now, these three social media vehicles represent the greatest collective value in social
media value chain for Millenials. This is very advantageous because marketers are able
to reach their audience at any point, however, represents challenges of media
cannibalism for social media influencers because the traffic is driven off their websites
and limits the content they may post in order to engage with their fan base.
Regardless of the manner in which Millenials engage in social media or regardless of
the specific social media platform they are inclined to using right now, the predictions
7do not see the social media engagement to be falling. According to research conducted
by Pew something 69% of Millenials will continue their behavior as digital natives and
will stay connected via social networks (See Appendix F, p.47). 28% of respondents
“will have grown out of much of their use of social networks. […] As they age and find
new interest and commitments, their enthusiasm for wide-spread information sharing
will abate.”
8INFLUENCERS
Current state of social media
Understanding values, motives, and responsiveness of the target audience is crucial. The
information is available for marketers’ understanding of their audience, yet, social
media marketing seems to be lacking its effectiveness. “U.S. companies spent $5.1
billion on advertising in social media in 2013, hoping to promote their products and
services. By 2018, that number is projected to grow to nearly $15 billion” (Zhu & Chen,
2015). The disconnect between marketing efforts and their effectiveness is caused by
lack of understanding of needs that are satisfied on social media and the lack of
understanding why consumers go online and participate in social media. “Congruence
of user need satisfaction in social media marketing can be achieved by aligning the
marketing content, process, and goal with users’ needs of using social media” (Zhu &
Chen, 2015). Social media marketing maturity seems to be low an ineffective in the
United States. While majority of the companies are past the Trial Phase of their
respective social media marketing campaigns, and most of them are either in Transition
or even Strategic phase, overall they keep failing to provide proper messaging and
appropriate addressing. “Users go on social media to connect with people, whereas
marketers go on social media to sell things” (Zhu & Chen, 2015). Understanding user
need satisfaction to connect with people or communities rather than to be exposed to
online advertising substantially improves effectiveness of any social media marketing
effort. This is especially true for Millenials who as mentioned before trust Word-of-
Mouth, or in this case Word-of-Mouse while having distrust towards any advertising.
Intrusive companies are either ignored or perceived negatively. Social media users want
to connect and engage with people and this is multifold true for millennial audience,
9especially women. Concluding based on provided information, social media influencers,
such as bloggers, are proven to be more effective and provide greater return on
investment than any other social media effort when addressing millennial audience.
Added Value of Influencers
Moreover, social media influencers provide tremendous added value to companies in
terms of reaching the target customer in an effective way. They can reach them in a
meaningful and personal way. On the other hand, many companies find it risky to
concede the control of the brand management. The presentation of the brand is done in a
unique way in alignment with an authenticity of the blogger. The added value becomes
the main and major risk. Millennials have low tendency to respond to traditional ads,
they are rather influenced by native content or blogs. “They value authenticity as more
important than content. 43% of Millenials rank authenticity high […]. Blogs are meant
to be authentic and many of them are run by a single individual. Millennials connect
best with people over logos” (Elite Daily, 2015). This being said, companies can build a
base of loyal customers if they hire online brand ambassadors to promote their products
and focus on active engagement with their customers. Online brand ambassadors
provide number advantages because they simulate word of mouth experience. They
humanise and personalise the product in eyes of consumers and provide unique behind
the scenes content that creates deeper relationship with consumers. “When people hear
something positive about a brand, 66% of them assign a high credibility rating to it,
rating it 9 or 10 on a scale of 0-10” (Social Horsepower, 2015). Generation Y demands
greater product knowledge and social media brand ambassadors and digital influencers
are an adequate medium to provide this information. Companies also gain larger trust in
10their product since “92% of customers trust peer recommendations” (Social
Horsepower, 2015). According to Social Horse power social media brand ambassadors
are cost-effective, drive customers to companies, represent companies online reputation
and grab more attention than tradition advertising.
One of the main advantages that influencers provide is that they manage to publish
customized profile-based content and broadcast it large scale. They effectively fuse
advantages of both profile- and content-based media in a unique trustworthy way. For
instance, “The Wall Street Journal’s print subscriber base of 2.1 million readers,” (Zhu
& Chen, 2015), while reach of personal Instagram profile of blogger Kristina Bazan, co-
founder of Kayture, has a following of 2,3 million in March 2016 (Instagram). Bloggers
are in an extremely unique position when it comes to reaching the niche audience and
establishing long lasting relationships with them. Influencers satisfy a set of specific
needs that users have when logging into social media. Top “10 candidate needs that are
satisfying to human nature: autonomy, competence, relatedness, physical thriving,
security, self-esteem, self-actualization, pleasure-stimulation, money- luxury, and
popularity-influence” (Zhu & Chen, 2015). Influencers are public personas that have
broadcasting power while maintaining the autonomy and relatedness of “just another
one of us”. According to the Business Horizon Publication, “the main needs that
relationship-based sites satisfy are relatedness and self-esteem.“ Influencers satisfy both
in a unique way, moreover, they have a celebrity endorsement attributes but the
relatedness and popularity influence are much higher and enhance the ability for
relationship building amongst the influencer and the follower off which the respective
companies benefit.
Many influencers reach public persona status and they receive a blue tick badge that
11accompany their name on Facebook and Instagram to prove that profiles were verified
and are authentic in order for them not to be impersonated or otherwise violated. On
Snapchat, most popular Snapchatters receive their own emoji. “Followers of these
celebrity accounts develop a parasocial relationship to their favorite public figures; that
is, a relationship in which only one party knows a great deal about the other” (Zhu &
Chen, 2015). Followers do know their public personas, therefore, any product
endorsement automatically becomes an extension of the persona presenting it in a non-
intrusive manner. “Two key elements enhance relationship building without inflicting
the feeling of intrusion: First, it depends on the nature of your product or service. Does
it convey a value, attitude, culture, or belief that people want to share with others? If
yes, then it is ideal for relationship-based social media marketing” (Zhu & Chen, 2015).
Examination of relationship-based marketing is the core of this paper and presents a
powerful yet delicate tool. “Second, when a product chooses a celebrity as its endorser
on Twitter, even for just a few tweets, that celebrity becomes an extension of the
product; this means his/her beliefs, comments, and actions are tied to the product, too”
(Zhu & Chen, 2015). While this example explains endorsement in Twittersphere, the
assumption is true for any social, digital or traditional media. It is important to analyse
what values the given celebrity, public persona, or smaller influencer represent in order
for the choice not to backfire and avoid any negative brand exposure related to the
choice of endorsement. For instance, many major brands, such as Nike or Tag Hauer,
have suffered substantial negative publicity, for instance, when Tiger Woods adultery
scandal burst. As an article From blogger to powerhouse accurately highlighted,
“leveraging fashion influencers is a great example of a shift in the world of marketing.
True influence is no longer about paid celebrity product endorsements in film,
television, and print. It’s about genuine, personal recommendations from believable and
12authentic digital personalities.” Digital personalities represent media powerhouses due
to number of specific reasons. Firstly, they connect brands to reach very targeted
audiences. Secondly, customers do not connect with celebrities the way they do with
“real people”. My friend Tereza running a fashion blog with 39 thousand followers is a
lot more relatable and personal than mega stars such a Rihanna. Understanding these
specific need-satisfaction attributes as well as similarities and contrasts between
celebrity endorsement opposed to digital influencer endorsement stand as reasoning for
why this paper excluded personas who gain fame on other than online media. For
instance, each member of Kardashian- Jenner clan has beyond imaginable marketing
power, yet their respective fan bases work on a different set of motivators and needs
even though there are overlaps. Thirdly, and lastly, “the paid sponsorship does not feel
authentic anymore” (Keinan et al., 2015).
Brands do recognize the trend and understand that they need products to be promoted
by someone who is personal and intimate with the target audience. Companies
identified the need to create a connection between the brand and the influencers in order
to create relatedness and authenticity. Since consumers are looking for lifestyle
aspiration and trends within the digital space, more on more companies and brands
shifted towards hiring digital influencers over other marketing tactics. Consumers seek
digital influencers due to their autonomous fashion and lifestyle authority and
companies seek them to connect via them with the consumers. “According to a recent
eConsultancy survey, nearly 60% of fashion and beauty brands have an influencer
marketing strategy in place, and a further 21% plan to invest in one in the next 12
months. Now, entertainment celebrities who used to influence purchasing decisions
with name recognition alone are taking a backseat to top fashion bloggers and
Instagram stars” (Mediakix, 2016).
13Fashion and digital influencers
Fashion industry is and always has been one of the largest and most progressive
industries in the world. Women’s clothing stores in the United States represent an
industry of 48 billion dollars (IBIS World, 2016). “Fashion week in New York City
(alone) funnels approximately $20 million into the country’s economy” (Business
Vibes, 2015). Fashion industry in the United States is fast and highly competitive, yet
extremely progressive when it comes to the usage of social media and digital
influencers. Fashion industry as a whole is the true early adaptor of social media
marketing tactics. “Nowhere is this transition more evident than in the world of fashion.
Top brands like Louis Vuitton, Dior, and Cartier are connecting with social media stars
that have a deep, personal connection with their audience around the globe. And digital
marketers in all industries should carefully watch to see how this new strategy could
help them connect with online audiences“ (From blogger to powerhouse). Leading
global brands understand and use digital influencers on a large scale because they not
only understand the value they provide. Additionally, they also understand that
incorporating a strategic social media marketing plan into an overall marketing strategy
is essential. Omitting social media marketing, especially when addressing Millenials,
the United States largest purchasing power, could erase them from a map of fashion
world; similarly as Nokia was removed from a world of mobile phones and Canon from
the world of photography. According to Business Vibes, “Louis Vuitton is so far the
word’s most valuable fashion brands worth nearly $23 billion, “ and they are first to
jump on the train of social media marketing to establish and dominate their presence in
the market.
14Business model
Authenticity is key to digital influencers. It represents their unique selling point and if
they become “sell outs” they would loose their market value. Digital influencers
understand the need for careful brand management, brand being themselves personally.
Therefore, even if paid, they will, in most cases not promote product they do not believe
in not to compromise themselves and their business. “Authenticity is the key to
consumers’ hearts, even in the case of paid endorsements” (Keinan et al., 2015).
Crucial to the understanding is the fact that digital influencers are essentially
businesses. They provide a specific contractual service to the companies on B2B basis.
According the From blogger to powerhouse, “popular influencers likely get pitched 100
times a week. They also may be represented by a talent agency or manager and cost
upwards of $50,000 per sponsored post.” It is a fairly interesting concept of B2B
collaboration because even if the endorsers get paid, the company has a little of the
products are promoted. The article further explained that it is fairly useless for bands to
push for promotion of pre-written branded content. Most influencer will not
compromise their brand and therefore will not do it and if they would, they would
charge extra. Furthermore, it states that, “digital influencers are content creators whose
efforts are better, faster, and cheaper than (those of companies).” In professional terms,
companies transferring control over production process of paid advertisement is called
radical trust and this concept has been progressively widely accepted. Since Web 2.0
and emergence of social media, virtually everyone with Internet access is able to create
brand related content. With emergence of social media marketers keep loosing their
power over the marketing message. On a positive note, this poses greater pressure for
delivering higher value and quality products because what ultimately matters, especially
in eyes of digital natives, is peer-to-peer review.
1516
Harvard Business Review Case study
The blond salad
The blond salad blog made its first entry on 12th October, 2009. As of today, Chiara
Ferragni, based in LA, is the most powerful fashion blogger worldwide and a marketing
authority. Her journey and the business development of her blog The Blond Salad from
2009 until today will be examined, analysed and evaluated in context of the research
paper.
The Blond Salad is the first ever blog to be invited to Harvard Business School and be
turned into a case study. Chiara Ferragni and her then boyfriend and co-founder
Richardo Pozzoli recognized a great marketing opportunity upon which they build two
businesses and generated €6 million in revenue within 5 years. In 2014 the two
companies run by Ferragni and Pozzoli employed 14 people. There are multiple key
success factors. As Ferragni said; “For me it was always about sharing my life with
people and seeing their reaction to it. That was everything I ever wanted to do.” The
unique selling point was her authenticity, which is a deciding factor in social media
satisfaction, as previously mentioned in this paper. Another key success factor was that
Pozzoli had a previous experience with managing social media and realized that his
girlfriend sense for fashion and lifestyle had extremely high engagement. He recognized
the value in Ferragni’s online presence and they collectively decided to act upon it and
have built a successful brand as well as business. Pozzoli said in his interview for
Harvard Business School Case Study; “It is hard to explain why, but from the very
beginning Chiara’s posts had high social media engagement. For example, Flickr was a
website focused on professional photography. Yet, when Chiara posted a picture of
herself wearing a new Zara sweater, she was getting ten times more comments than a
professional photographer who would post a photo reportage after one month spent in
17Africa. At that time, we started understanding how sharing a look, an outfit was
engaging people.” This happened right after his three-month long internship in the
United States where he was in charge of social media management for a gardening
company. In 2009, in the United States, many bloggers, such as Tavi Gavinson running
his blog StyleRookie.com, many fashion houses started to try to implement online
authorities with their brands, inviting bloggers to fashion shows to report upon them as
well as fashion magazines featuring many of them on the cover. Ferragni and The
Blond Salad were a perfect European equivalent and once European fashion brands
wanted to collaborate with digital influencers in field of fashion there was no one but
Chiara Ferragni. She had a tremendous advantage of being a blogging pioneer. The
Blond Salad was a unique project and became extremely popular relatively fast due to
great timing and appropriate execution. Her authenticity and relatedness as well as
number of right business decision along the way with emergence of Instagram and
Snapchat made her one of the most vital people on the Internet to address millennial
women. Ricardo explained the early success of the blog; “Soon Chiara started receiving
comments from many people in Europe for whom checking The Blonde Salad entered
their daily morning routine together with reading the news before starting work. The
blog became a part of people’s breakfast.”
Although ,“Ferragni, selected among the 30 under 30 in Arts & Style by Forbes in 2015,
emerged as an international celebrity and influencer attending fashion events all over
the world,” her success was conditioned by number of executive decisions on the side
of the founders of The Blond Salad. Nowadays, Ferragni does have a celebrity status, as
mentioned before, which is a subject to parasocial relationship with her followers,
however, this might have not been the case. Ferragni’s position as the only professional
full time blogger was of value to media channels such as Italian television. As stated in
18the case study; “Ferragni was offered a couple of jobs on Italian television, but the duo
thought that accepting these offers would go against their beliefs. Pozzoli commented:
“Chiara was interested in real fashion, not the show business. We were young students
and it was not easy for us to say “no” to such proposals with high financial reward. But
we decided to stay away because we knew that if we wanted to work in fashion, we
could not sell Chiara as a showgirl.” Brand management of Chiara and staying true her
brand is exactly what made her a successful digital influencer. Reminiscing and
evaluating the decision to bypass show business enabled Ferragni to become an
international fashion and lifestyle influencer rather than an Italian celebrity. In reference
to the earlier research and the basic social media needs, the decision to stay out of mass
media was vital to create a brand of value for companies as well as a trustworthy
influencer for her audience.
Ferragni’s followers tremendously value close relationship they are able to maintain
since The Blond Salad blog as well as all the other social media channels such as
Facebook, Instagram, and Snapchat provide. They are able to follow a lifestyle of a
respected fashion authority that is just like one of them rather than a TV personality.
Ferragni’s sense of fashion, regular postings on the blog and professionalism lead to
multiple invitations to important fashion events. Pozzoli commented, “With every
fashion week Chiara got more and more views from all around the world. One year
later, Chiara was invited to all the international fashion weeks, which became part of
her lifestyle.” Her personal story and hard work are the hook to her success and
dedicated follower base. She is an inspiration to many young women. She started
blogging out of love for fashion and now she is sitting in a front row to watch fashion
shows of world’s most exclusive brands. Her fans can follow her day-to-day life on all
social media and keep up with her. There is a tremendous intimacy to this relationship
19and if Chiara is excited about her new boots she bought during fashion week in New
York, so will be her followers. Intimacy and immediacy of the communication that
Chiara provides for the company has beyond tremendous value. Millenials are much
more likely to bond with a brand if they see all the work in behind the scenes Snaps and
Instagram posts in real time. They are able to see the fashion show on Snapchat just as it
is happening; thru her eyes. For many, it is almost as being there and is much more
personal, intimate, and creates stronger relationship that professional pictures of the
fashion show after it. The higher value that is essential to The Blond Salad branding and
value proposition is its personal touch and story- telling.
Regarding the power of storytelling that is curtail for The Blond Salad, Pozzoli
commented; “Chiara would tell a story about wearing a certain garment, having a trip,
driving a car, just having a particular experience that she was living with the company,
and would include a couple of companies, website links in the text. This would really
engage her followers who were then way more likely to convert – to click on the link
leading to the brand’s website and to buy. It was no longer just a link, but a part of an
experience that Chiara was sharing with the users. This proved to be very successful
and attractive to the brands.” Brands have many marketing tools to address their
message to their target audience, however, they cannot tell it through the eyes of the
consumer. Millenials respond to peer-to-peer review, they want to know what
experience had one of them with the product. Chiara could tell the story and engage her
fans in a sincere trustworthy way for much less money that the firm could ever
accomplish. However, with expansion, authenticity became a key success factor once
again.
The expansion of the blog attracted many new companies and brands that wanted to
work with The Blond Salad, as well as, they wanted to implement an online campaign.
20Many blogs became a shopping window, however, it was in the heart of the company to
always reflect Chiara’s personal style within her posts. Ferragni reflected on the
situation; “We knew that we had to think big, but slowly and carefully, and being
selective has always been the key. For me it was about whether I like the brand, the
product, and whether the proposed project is cool. If something didn’t feel natural to
me, we would say “no” even if it meant bypassing a lot of money. I know my followers
because I read their comments every day and they know me and my style. I always
wanted to stay true to them and to myself. ” The close relationship with her audience is
the core of her business and an exact reason why she is able to use her brand and
develop and retain relationship for brands she represents and her fans. Harvard Business
School Case Study refers to this more deeply stating, “From the onset, Ferragni and
Pozzoli were very selective when choosing the brands to work with because the stories
Ferragni would tell about these brands had to reflect her own lifestyle. As Pozzoli
pointed out, "We wanted to build value around The Blonde Salad’s brand and Chiara’s
celebrity, not to be just another shop window.” They believed for their business to be
successful, they needed long-term relationships with selected brands to display a certain
commitment. And then pass this relationship onto followers. “We wanted to be
associated with certain brands and to build stories together – it is what we do best.
That’s why we needed longer term relationships.” Pozzoli cited their project with
Burberry as one of their most successful early partnerships.” Burberry let them full take
over the entire production as well as let them pick specific peace’s of the collection.
Essentially, the entire idea of digital influencers can be illustrated on the
Burberry example. The Blond Salad team took over production and had much lower
costs reaching vast audience while retaining an added value of exclusive authenticity of
what products they choose from the line and how they style them providing added value
21of personal style while creating a link between the company and the consumer.
22SOCIAL MEDIA
Facebook
Facebook still deems to be predominant, on average, users of 18 to 34 years old, spent
25,7 hours a month on Facebook compared to only 7 and 5,9 on Instagram and
Snapchat, these still being the three most popular social networking mobile apps.
Although Facebook remains to be predominant social media for the demographic, they
mostly use it for either instant messaging or to see news on News Feed rather than to
follow influencers. In early February 2016, Chris Matyszcyk (2016) published an article
called Why Millennials have stopped loving Facebook. The article states that “the thrill
is gone because of Facebook's "unapologetic ubiquity."” Essentially meaning, Facebook
becoming a mainstream social media platform caused loss of intimacy that Millennials
so dearly value. “The issue is philosophical. Millennials do have a deep philosophical
bent. Millennials cannot be associated with something with which everyone else is
associated. They must have their own thing” (Matyszczyk, 2016). This is a key
understanding in order to evaluate the value brought by Instagram and tremendous shift
towards Snapchat in recently. Moreover, growing number of Facebook users in all age
groups caused the circle of friends to be substantially larger; including family members
and co-workers, which implies restrictions on content they would normally share with
friends. Most influencers have significantly larger fan base on other social media other
than Facebook, primarily Instagram. Even analyzing to bottom threshold of the
Millennial segment, teenager, the results are similar; “71 % of teens use Facebook,
making it the most popular social networking platform among 13 to 17 year-olds.
Instagram is the second most popular (used by 52 %), followed by Snapchat, Twitter
and Google+” (Handley, 2015).
23Snapchat
Snapchat has grown exponentially in past few months and although the app itself has
had troubles monetizing its service it has created an extremely valuable communication
channel. Snapchat allows following influencers and their daily life in real time
providing more personal contact, and essentially humanizing the brands they promote.
It is also effectively used as a “behind the scenes” instrument and the feel of being part
of the brand. Influencers constantly documents their daily lives, products they use,
fashion shows they attend, photo-shoots they go to, but most importantly, them as real
people allowing consumers to connect with a real person rather than a brand. The power
of influencers as ambassadors has been given tremendous strength with introduction of
Snapchat. In an effortless snappy way instead of carefully planned and produced
content of, for instance, Instagram. With Snapchat, Seth explains, "there's no sense of
warped virtual validation that arises via Facebook 'likes' or Instagram 'hearts' and no
social pressure to conform to a public persona" (Matyszczyk, 2016). Snapchat provide
users with more intimacy, less publicity, and more realness in terms of inability to
manipulate the images compared to Instagram. Instagram is criticized for crafted reality.
Snapchat addresses all these issues and that is why it is a viable way for influencers to
get in touch with their fans and cultivate relationships in an intimate personal ambiance.
The critique of online reality on Instagram rose considerable issues in late 2015 with
viral video of former Instagram influencer Essena O’Neil exposing what she referred to
as a true nature of paid posts that are not transparent as paid advertising. The exposure
of the monetized nature of social media reality gave less credibility to Instagram post
and started conversations about harmful effects and distorted reality on social media
that is essentially caused by non-transparent marketers.
24Snapchat is the new sensation when it comes to social media, according to Bloomberg
Technology, “The app boasts over 100 million daily users. Evan Spiegel, the CEO of
Snapchat, addressed the investors at the Morgan Stanley Conference in late February
2016. Bloomberg Technology also reported upon his speech and the numbers speak for
themselves. Snapchat reports the same number as Facebook when it comes to videos a
day, whooping 8 billion. Compared to the same time last year the number is up more
than 5 times, which represents over 500% increase in engagement in a single year. The
growth is quick and massive and snapchatting becomes an addictive trend. Each one of
over 100 million daily users “spends an average of 25 to 30 minutes on the app
each day” (Bloomberg Technology, 2016). These numbers undeniably speak for
themselves, however, the significance of Snapchat in terms of targeting Millenials, is
even greater. Millenials are the ones who power Snapchat’s success. According to
Bloomberg, Spiegel said that, “Snapchat's appeal lies in its popularity in a young
demographic addicted to their mobile phones, and the app reaches 41% of the 18- to 34-
year-olds in the U.S. each day” (Bloomberg Technology, 2016). Millenials fell in love
with Snapchat, it is their mainstay, and they will not let it go. DJ Khaled, a proclaimed
King of Snapchat, said, “My Snapchat has more viewers than any TV show.” The
article further commented upon this seemingly outrageous claim, “That’s an
exaggeration, but not by much. Khaled’s videos attract 3 million to 4 million viewers
each. Given how Snapchat skews overwhelmingly tween to late-millennial, that means
about the same number of young people are watching him admire flowers as are
watching the biggest network sitcoms. According to Nielsen, roughly 3.3 million people
age 12-34 watch The Big Bang Theory.” This being said, Snapchat is one of the most
25viable social media vehicles to reach Millenials in the United States given the right
choice of digital influencer.
The success story of Snapchat as a business made a Bloomberg Businessweek cover
story on March 7th, 2016 citing, “Snapchat was primarily known as a disappearing-
message app useful for sending nude photos to lovers and lewd doodles to friends”
(Bloomberg Businessweek) That was how everyone saw is just about a year ago, yet
now many young Americans feel more inclined to use Snapchat opposed to Facebook
or Instagram. As mentioned before, Millenials are challenging to target and have low
response to advertising. They expect targeted and engaging context from companies.
Targeting Millenials is essentially going against conventional marketing wisdom.
According to Honigman, “Conventional marketing wisdom indicates that branded social
media should be highly polished. Brands have reputations to build and blockbuster
budgets to ensure their reputation remains perfect.” However, perfected imagines are
perceived as “fake”. Referring back to social media satisfaction, Millenials value
authenticity and 10 second long snaps are just that; authentic moments.
Snapchat executives introduced a value to the app as a social media when they
introduced the feature called “My Story”. This feature gave the disappearing-message
app a new dimension while not intruding on its core unique selling point. Snapchat’s
“My Story” allows users to post videos or pictures up to 10 seconds each and publicly
share them with their friends for a span of 24 hours, after which the posts disappear.
The relevance of this feature is a game changer for fashion industry. An article called
For an Insider View of NY Fashion Week, Just Download Snapchat correctly pointed
out fashion weeks used to be “Once a Fairly Private Affair for Buyers, Now (they are)
26Mapped by Apps.” Snapchat’s story provides a unique opportunity to see the fashion
show as if the person was there. Not only to see the fashion show, moreover, to see
behind the scenes of it through the eyes of their favourite fashion digital influencer.
According to Neha Ghadni, vice president of editorial strategy at media outlet
Refinery29, "It's about bringing people along with you, everyone gets to take a look
around and honestly share it. There's transparency in Snapchat." Even the Harvard
Business School Case Study blogger Chiara Ferriagni said that her marketing power lies
in her ability to enable her followers to experience fashion and fashion shows thought
her eyes. This is multifold true for Snapchat. Claude de Jocas, director of the
intelligence group at researcher L2 Inc, said, "Snapchat really lends itself to the behind-
the-scenes and backstage sharing, and consumers are really craving that. It's helping
consumers see past that gloss of fashion week and giving them authenticity." This
provides a unique way for brands to get in touch with their audience, especially teens
and women in their 20s. Snapchat assures that the content is in hands of digital
influencers who publish the story while brands get to represent themselves in a
controlled intimate environment of their fashion shows. Digital influencers spread their
experience in to a broad audience in an intimate manner within their overall coverage
over all other social media. Snapchat places the consumer right where the influencer is
in a real time, or within a 24 hour span.
Challenges of Snapchat
Snapchat’s unique selling point is undeniably its intimacy. As mentioned in
Matyszczyk’s article about Facebook, the intimacy is gone on Facebook and Instagram
required more artistic input then just a single snap to capture the moment. CEO of
Snapchat even stated this publicly and said “We’ve made it very hard for parents to
embarrass their children” (Bloomberg Businessweek). Snapchat accounts work the
27same way as phone numbers, you either have to have someone’s phone number or know
their account number or name, after which they have to confirm the friendship.
Influencers, for instance, can be followed without confirmation, however, they still have
to be added by manual search opposed to, for instance, “Explore feature” on Instagram.
Therefore, any digital influencer or celebrity has to promote their Snapchat account on
other social media platforms and extensively call for action to add them. Snapchat itself
is valuable as a part of multi-platform campaign. “A digital influencer has traditionally
been easy to find. Followers, number of engagement, and verification all point brands in
the right direction. With the introduction of Snapchat, however, all previously used
metrics have been thrown out the window, and finding a Snapchat influencer has
become increasingly difficult. The ephemeral nature of Snapchat makes the platform
unique, attractive, and difficult all at the same time.” Snapchat recognizes the transition
from being an exclusive messaging platform to functioning as social media. In order to
address challenges with connecting consumers with celebrities and influencers, they
created “Official Stories account, designed to make it slightly easier for Snapchat
newbies to find celebrities” (Frier, 2016).
Case study
Digital Influencer versus Companies
Events and major brands can attract a lot of attention. For instance, “Coachella draw 40
million video views to Snapchat Live Stories.” Audi’s 2013 successful trial with
Snapchat yielded 37 million views. These numbers represent a huge exposure, however,
when Relativity Media hired Vines star Jarrome Jarre to promote movie “The Best of
me”, they received a total of 26 million views in 24 hours served to the target audience
by their beloved digital influencer (Honigman 2014). Jarre’s story comprised of series
of 28 snaps. According to 19, Snapchat entered a collaboration with Gatorade, even
28thou none of the parties “would comment on price, but reports put it between $450,000
and $750,000 per day. The videos of virtual drenchings were watched more than
160 million times.”
In conclusion, to reach 26 million people of primarily millennial audience within 24
hours in an intimate way does not have an equivalent in todays marketing environment.
Even though Gatorade was able to get 160 million view in 24 hours, the combination of
power of digital influencer combined with the valued attributes of Snapchat have
tremendous added value, and are effective in order to create awareness and engagement
on deeper level. Companies aim to have a meaningful interaction with millennials;
digital influncers communicating via Snapchat are definitely providing a meaningful
link.
Metrics
There is a whole science evolving and changing every day regarding metrics online and
on social media. The catch regarding Snapchat is, there is no sophisticated metric
system whatsoever. “The only measurable tools available for brands to measure success
are the amount of times a snap has been opened and how many screen shots were taken.
Not only that, but there isn’t an auto-populate field when you search for a name, nor is
there a visible follower count on profiles.” On Snapchat all are equal, users can watch
their neighbors story and Arnold Schwarzenegger’s story while having no idea how
many other people have watched the content. It is all very intimate. Frier correctly
reports, “Snapchat is quickly becoming a destination for advertisers to reach young
people, but doesn’t yet offer the targeting or measurement capabilities of Facebook Inc.,
Instagram and Twitter Inc.” While all other mainstream social media have sophisticated
measurement capabilities, Snapchat is a toddler in the field. However, Imran Khan,
29Snapchat’s chief strategy officer, addressed the issue, “We’re committed to bringing all
the major measurement solutions to our platform” (Frier, 2016). Recent Bloomberg
Business week cover story also addressed the lack of metrics advertisers are looking for,
“In late February, Snapchat announced it would provide detailed demographic
information about users through Nielsen’s digital ratings service, a welcome
development for some advertisers wary of the hype.” However, the sole growth of
Snapchat, as the soft of platform it is shows that “engagement and brand awareness are
the top metrics for measuring social“ (Johnson, 2015). In order to achieve high rates of
engagement and increase in brand awareness, brands partner with social media
influencers or marketing agencies that have deep understanding of each platform and
overall social media environment to yield maximum returns on investment. Unless
brands and companies have enough deep knowledge to navigate each social media
platform adequately, experienced digital influencers or marketing agencies are the best
way to conduct effective marketing campaign and adequate ROI.
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