At Moscow’s Sheremetyevo International Airport in early 2017, waiting to board his flight back to Paris, Olivier Billon noted a forty-something man beside him wearing an expensive Panerai watch and asked how he got to know the brand. The answer surprised him: Instagram. But it also filled him with pride: Mr Billon is a pioneer of influencer marketing — where brands engage those with millions of followers on social media, whether with experiences, gifts or money, to promote their goods.
Mr Billon, fresh out of elite French university Sciences Po, worked on early influencer campaigns first for cosmetics company L’Oréal and then through his consultancy Ykone, founded in 2009 when he was 24. He was convinced, he says, that his friend Betty Autier’s blog — with 400,000 views a month when Mr Billon started his business — “could be of great interest for brands”.
With his choirboy-like manners, Mr Billon advises companies how to create and maintain an engaging presence on social media, from events and product launches designed to be worth sharing — with mandatory hashtags and branded photo opportunities — to ad hoc activities for influencers. His first clients were L’Oréal Professionnel, Chanel couture and Dior couture. “My first project within the watch and jewellery industry was for the launch of the Dior VIII watch in 2011,” he says. For that, he orchestrated “a two-day experience and presentation of the watch for a group of international influencers in Paris” on behalf of the brand.
Influencer marketing was then becoming relevant to the industry as a more mature — and wealthier — audience took to social media; at the same time, luxury goods companies introduced more accessible product categories for younger users. It is now, according to Mediakix, an “influencer marketing agency”, a $1bn market.
“When I started it was all about the blogs. Now it’s all a different story with Snapchat, YouTube and Instagram,” says Mr Billon. Instagram is a community of 800m people sharing and liking each other’s photos, and 75 per cent of Instagram’s users said they had been inspired by a post to take actions such as visiting a website or buying something online, according to a 2015 survey. “Instagram has brought transparency. It is easy to assess the size and quality of the influence by checking the numbers and identities of the influencers’ followers,” he says.
Outside his office, it is Paris Couture Week and influencers — with their Instagram-ready outfits and sponsored luxury goods — abound.
The rise of influencers is linked with fundamental changes in the economics of the luxury sector and the technology of the wider world. A 2017 study by consultants Bain indicated that millennials already make up 30 per cent of luxury consumers. At the same time, dressing down — signalled by increased spending on luxury casualwear — has gone up.
Luxury companies’ investments in influencer marketing have also been prompted by the growing popularity of ad blocking software, nullifying their spending on digital adverts. There are 615m devices which have ad blocking software, according to PageFair, a tech business, which says it serves “unblockable” ads.
There are ‘too many influencers trying to sell us things’, which will disengage the audience
Alongside this, companies began to conceive of advertising as an enjoyable experience rather than an interruption. Paid posts on blogs were the first to do this, and such “native content” has spread to magazines and newspapers. A study conducted by the Word of Mouth Marketing Association — whose members are media agencies and global companies — found that word of mouth, even digital, can drive sales anywhere from five to 200 times more than paid advertising.
“The young generation is an important market because it is a big market and it is the market of tomorrow,” says Jean-Claude Biver, chief executive of TAG Heuer and president of luxury conglomerate LVMH’s watch division. Mr Biver notes that, thanks to recent partnerships with ambassadors such as footballer Cristiano Ronaldo and model Bella Hadid, who have 118m and 16.5m Instagram followers respectively, millennials have grown significantly as part of TAG’s customer base.
Tariffs vary enormously according to the length and type of projects, as well as the parties involved. Influencers seeking to elevate their status might be willing to work for free for a desirable high-end brand in exchange for an experience that will provide content for their media channels. Sometimes the brand secures media coverage about the influencer as part of the collaboration’s agreement.
An influencer with 100,000 followers on Instagram can charge around £2,000 per picture, while celebrity influencers with between 4m and 20m followers can charge £5,000-£13,000, according to Hopper, a company offering an “Instagram planner and scheduling tool”. Selena Gomez’s social media posts to her 132m followers, however, are worth $550,000 each, Hopper says.
From the perspective of watch and jewellery houses, collaborations are more successful when the influencers develop a genuine affection for the items they have been gifted and wear them beyond the contractual period. In this sense, Olivier Billon recommends that brands work with influencers “who have a real passion and interest for a brand and commit to create authentic posts”, rather than choosing them on the basis of crude numeric figures.
Mr Billon explains the importance of focusing on “achieving high engagement rates (above 5 per cent) in likes, comments and shares” and adds that often micro-influencers (those with fewer than 50,000 followers) offer higher levels of engagement. “It’s peer-to-peer marketing. Influencers may not be our friends, however they are constantly present when we look at our social media feed.”
Selectivity is important for influencers too. “I do what I do out of enthusiasm, and often simple egotism,” says Chiara Ferragni. Ms Ferragni is a self-made social media celebrity, with 11m followers on Instagram, and is now chief executive and creative director of a small empire born out of her blog, theblondesalad.com. In 2017 Ms Ferragni and her sister Valentina’s collaborations generated €6m and are expected to grow by 80 per cent in 2018, while Ms Ferragni’s shoe line reported $20m in revenues in 2016.
Together with her co-founder, Riccardo Pozzoli (now a minority stakeholder with no operational role), she executed a plan to build a personal brand with carefully selected partnerships and iron discipline. Ms Ferragni minutely lists and files everything she needs to act upon on her phone, which rarely leaves her hand, and instead of being represented by one of the leading modelling agencies, which have stepped into the influencers’ business, she has her own talent manager.
“I prefer to concentrate on long-term partnerships rather than one-off projects,” she says. Ms Ferragni has collaborated with Cartier since 2014 for the launches of the Amulette necklace, the new smaller version of the Love bracelet and the Panthère watch (duly hashtagged #ad on her Instagram account).
She also has a longstanding partnership with the emerging jewellery brand Nétali Nissim. Ms Nissim says that one of Ms Ferragni’s Instagram posts where she is wearing gifted Nétali Nissim items generates between 5,000 and 10,000 visits to the brand’s website. Ms Nissim credits the brand’s social media activity for its introduction into retail spaces.
Cartier (where I formerly worked) is a prime mover in the influencer sphere. Before Valentine’s Day 2017, the maison partnered with 50 social media influencers to promote the Love bracelet — a lighter and more accessible version, priced at £3,600, of the bestselling original
At an event in April 2017, Cyrille Vigneron, Cartier’s chief executive, said that the campaign had reached 45m people — predominantly young — while “more mature customers discovered the novelty in store”. He added that “influencers were carefully chosen according to talent and affinity with the maison rather than fame”. Cartier now splits its communications spend almost equally between “classic” advertising and events, influencers and social media.
Mr Billon, however, warns brands against solely relying on content generated by influencers. A brand’s mystique, which can be conveyed in blog posts, might be jeopardised if simply shrunk to square-formatted pictures accompanied by a few words and hashtags on Instagram. He says that “it’s a matter of striking the balance between influencers’ and brands’ created content” and questions whether it is appropriate for customers to discover elaborate and expensive creations through influencers.
Instagram has brought transparency. It is easy to assess the size and quality of the influence
He is privy to brands’ concerns as he has worked with most of the important luxury houses. Some still hold out against influencers, however: Hermès, the leather goods and fashion house, resists collaborating with influencers if it involves payments, gifts or ad hoc experiences.
Influencers’ posts have starting to attract regulators’ attention. The US Federal Trade Commission released guidelines in March 2017 and sent letters to influencers in September warning them to disclose paid-for social media posts with a view to protecting consumers.
However, if concerns arise about possible violations, the FTC guidelines state that brands are “ultimately responsible for what others do on your behalf”. In order to co-operate with the FTC, Instagram introduced a “paid partnership” tag in June 2017.
Pelle Sjoenell is worldwide chief creative officer at Bartle Bogle Hegarty, the advertising agency that orchestrated merchandising campaigns for singers Justin Bieber and Ariana Grande. He urges companies to reconsider millennials and the communications strategies aimed at them. He believes that there are “too many celebrities and influencers trying to sell us things”, which will eventually disengage the audience: “[Brands cannot expect] to tag along without looking like they are jumping on the bandwagon.” They should not neglect “the long-form, knowledge, expertise, depth” when appealing to millennials either, rather than assuming a single post will do.
Sometimes influence is not enough. Kristina Bazan, 24, was one of the first bloggers whom high-end watch and jewellery houses trusted, and she has amassed 4m followers on social media since 2012. When she told her father she wanted to start a blog, kayture.com, he demanded a business plan and monthly meetings to monitor her progress, turning it into a career from the off.
It is still working well — Ms Bazan attended the extravagant relaunch party for the Cartier Panthère watch in Los Angeles in May; flew to the Cannes Film Festival as L’Oréal ambassador, wearing Chopard jewellery; and has filmed a project for watch brand IWC. But like many other influencers, Ms Bazan is embarking on a new venture: music. So why music now? She takes a deep breath: “I miss the profound.”