Are Influencers Worth Your Money? We Went Undercover to Find Out.

Are Influencers Worth Your Money? We Went Undercover to Find Out.

This story appears in the March 2018 issue of Entrepreneur. Subscribe »

If your company sells anything at all to the public, you’ve heard about Instagram influencers -- the hottest topic in advertising since, well, advertisements. As social media has begun supplanting TV, newspapers and magazines as a primary entertainment source, companies have been forced to seek new ways of getting their products in front of the eyeballs of the coveted youth demographic. Businesses can, of course, just buy ads that Instagram slips into the streams of its users’ photo feeds. But younger consumers are alarmingly adept at ignoring those. 

The ideal solution would be to infiltrate those streams not with ads but with the familiar, trusted voices of friends -- who are also, as it happens, pushing the exact message you, the entrepreneur, want pushed. 

So, naturally, there has become such a thing as an Instagram influencer. A person, usually young and attractive, who creates a rich social media fantasy life, into which they will happily slip a glowing reference to your product in exchange for free stuff or a small fee. This allows you, as a business owner, to create an ad without hiring models or photographers. It also allows your potential customers to see your product not in the harsh light of some studio but in situ, in the glamorous life of an actual person. 

Except: Unlike advertising agencies or legacy media outlets, influencers often have no bona fides beyond an attractive online persona and a large number of followers. There are few established norms for interacting with influencers, and little scaffolding set up to prevent, say, someone from sending you an invoice for services rendered after you’ve already sent them free candles. 

“I would say we get about five or six requests a week,” says Natalie Markoff, founder of the Markoff Group, a PR agency that represents about a dozen small, luxury retailers. Most of the publicity requests Markoff receives start off easygoing, she says. “They will say, you know, ‘I have an Instagram account. I’m an influencer. I love your product; could you send me some?’ And then about three or four emails in, after I’ve already sent them product, they’ll send me a rate card.”

Shamelessness isn’t the only pitfall. Outright fraud is also fairly common: ads so bogus that the FTC recently threatened to slap folks with lawsuits; fake followers; fake lighting; ludicrous requests for money and products and stuff, stuff, stuff. “Anytime you have that kind of money flowing into a platform this quickly, it’s a gold rush,” says Evan Asano, CEO and founder of Mediakix, a social media marketing agency. And like any gold rush, it tempts both decent folks and derelicts.

That’s not to say you should write off this burgeoning corner of the ad economy as a scam, however. Instagram, for all its faults, is enormously influential. As of September 2017, the site had 800 million users, 80 percent of whom follow a business, and more than 60 percent of whom say they discover new products on Instagram. As for the influencer market, according to a recent estimate by Mediakix, it was worth $1 billion in 2017 and could double over the next several years. That’s billions of dollars companies will likely be spending on entrepreneurial one-man-band social media “stars” in the hopes that it will benefit their bottom line. 

But does paying influencers result in actual sales? And if a photogenic, doe-eyed 22-year-old approaches you and asks to represent your handbags/coats/sweaters/hotel/restaurant on Instagram, will you wind up getting ripped off? To get answers to these questions, I decided to go undercover and infiltrate the Instagram economy. I called some successful influencers, created a fake design-guru persona, bought a bunch of fake followers, solicited some free product and, well, started influencing. Here’s what I learned.

Michelle Williams is one of the good influencers. A former public relations executive, she runs the blog-­Instagram complex Coffee and Champagne, which has 116,000 followers. It’s clear why she has been successful at this. Pleasant and forthcoming, she posts compelling snapshots of oozy, melty sandwiches, ice cream cones as frilly as antebellum dresses and her own tan, dark-haired visage looking pensively out the windows of various cafés. A full-time freelancer, Williams makes about half her money from her blog and the other half from Instagram, much of it by partnering with food companies to create and shoot new recipes. She’s what you’d get if a magician turned Saveur magazine into a person. 

When I told Williams I intended to fake my way into the Instagram economy, she told me it’s much more difficult to break in than it was in the good old days of 2014. Back then, you could just take pretty photos of food and add them to a photo gallery. Today, with so many people trying to quit their day jobs and turn influencer, you have to have a good schtick to stand out. 

“I tell people to come up with their own visual technique,” she says. There are accounts that post only pink photos, for example, or post clothing always shown against a one-color background. One influencer Williams likes got popular by taking photos of food from a bird’s-eye perspective, so followers can see both the plate and the account owner’s shoes. In the parlance of the Instagram economy, your schtick is your “aesthetic,” and as a business owner, the idea is to work with influencers whose aesthetic matches your idea of your brand. 

“If you look at the creatives that are getting a lot of ‘gigs,’ as we call them, some of our highest-performing ones are professional photographers,” says Aana Wherry, director of marketing, communications and creator experience for Popular Pays, a site that acts as a sort of matchmaking service for brands and influencers. “We have tags with which we filter our creators, whether it’s men’s fashion or food or different categories of content or audience.” 

You can think of influencers as mini magazines; you want to place your ads only in those whose look fits your brand and appeals to your demo.

For my aesthetic, I decided on an interior design feed that would consist mostly of candles. Why? Because it’s specific, it’s an underserved niche and I like free candles. To start, I bought a few chichi candles, arranging them around my one-bedroom apartment to create desirable vignettes. My plan was to create a barely believable feed of luxe candles displayed in the various rooms of a fictitious house on the beach. I would ask small businesses to send me free candles to place in future photos. And then I would just see what happened.

This strategy proved unsustainable. I ran out of content very, very quickly. One thing they never tell you about being an Instagram influencer is you need a ton of content. Williams posts one or two photos a day, plus material for Stories, the live A/V feed of an influencer’s daily grind that was added to Instagram in 2016 to mimic Snapchat. 

So, this being the internet, I stole. I started out just reblogging other people’s candle photos, with attribution, but before long, I started cropping out the original posters’ identifying details and uploading their photos as my own. I added layers and layers of hashtags to everything (#zenlife, #beachstyle, #instadecor) to try to get like-minded accounts to repost my photos. None of it had the desired effect. My most popular post got 26 likes.

Growing an audience quickly became a monstrous task. This, it turns out, is most of what you’re paying for when you hire an Instagram influencer: the engaged and receptive audience that has grown to trust them. “It’s not easy to get that many followers and keep them engaged and appeal to their interests,” says Wherry. “These creators are experts at it.” In short, it’s not as easy to go viral on Instagram as it is on, say, Twitter, where one brilliantly timed joke can launch your account into the stratosphere. Building a huge audience on Instagram can take years.

Patrick Janelle, @aguynamedpatrick, built up his 458,000 followers over several years, first while working as a graphic designer at Bon Appétit, which reblogged his photos and then by being consistently engaged -- making friends and liking other people’s posts. “I have a number of people who have been following me for a long time, whom I have conversations with and whom I’ve never met in person but are constantly sending me notes, even leaving me a comment or sending me a direct message about something I’ve posted,” he says. “I don’t know that I can necessarily describe how to do it. It changes constantly.”

Of course, I didn’t have Bon Appétit to reblog my posts, or years to build a devoted following, so in keeping with my utterly underhanded business plan, I contacted a company that would allow me to simply pay people to like me. As it happens, there is a surprisingly large group of such companies, all with varying degrees of legitimacy, which have sprung up around the Instagram community like brothels around a gushing oil derrick. Some of them have names that sound relatively benign, such as Social Envy, Hypez and InstaBoostGram. Others, such as a company called Buy Instagram Followers, don’t bother trying to hide what it is they offer. I chose one called Buzzoid, which sells tiered packages of “quality” followers, topping out at 5,000 followers for $39.99, and emailed for details.

The response came from the “product owner” of Buzzoid, a man named Michael, no last name, who once signed his email both “Michael” and “Paul.” Astonishingly, when I asked, Michael-Paul agreed to help me out for free -- offering 5,000 followers as well as any likes I needed for several weeks on a trial basis in exchange for this coverage you’re reading right now in Entrepreneur (in what I’m calling the Inception of Instagram influencing). He balked, however, at answering any questions about his business model, writing only, “We do in fact provide real likes and followers to our customers. Which is why you will often see a drop in users if your account is not interesting or has poor material.”

Fake or not, hours after Michael-Paul bestowed my followers upon me, I could feel internet stardom suffuse my online life. I went on a friending spree down an acquaintance’s followers list, randomly friending 250 of them. Convinced by my bank of 5,000 prepaid devotees, more than 50 of these real people followed me back. I began to get actual likes on the photos I hashtagged. It was working. 

I had followers, momentum and a schtick. I was almost ready to start reaching out to companies. All I needed was to fill out my backstory. Michael-Paul had agreed to provide me with likes in addition to my followers, but I couldn’t ask him to do it five times a day. Plus, I had only about 25 posts. If anyone scrolled far enough down, my feed would disappear into the ether. So I went on a fake vacation. I searched for beautiful scenes from Positano, Italy (a place I’ve always wanted to visit), and then cribbed them from other users, posting them with captions such as “Finally made it to #positano. Can’t wait to sit on the terrace and have the meal of my life. #amalficoast #wanderlust #travel #dreamtrip #bucketlist #timeflieswhenyourehavingfun.” 

I asked Michael-Paul to scatter around enough likes to make the vacation seem realistic and hoped the brand managers I contacted would quit scrolling before they found anything peculiar. Then I sent out an email blast to four candle companies, requesting product for an upcoming shoot.

There is no way anyone will believe this is real, I thought. It’s absurd, ridiculous, completely transparent.

And then the offers started rolling in. 

In 2017, Evan Asano of Mediakix ran an experiment. Hoping to highlight Instagram’s vulnerability to fraudsters, he and his staff created two influencers who were utterly unreal: @wanderingggirl, a world traveler whose snapshots were free samples from a stock photo site, and @calibeachgirl310, a lifestyle account they’d shot with a model in a single day. Posting as these faux humans, Mediakix solicited business on influencer platforms, which are websites -- such as Popular Pays and TapInfluence -- where businesses can find influencers to work with.

The scam worked. Mediakix got four offers of money and gifts from brands before they halted the experiment. 

What can business owners learn from their experience?

“There isn’t a single, simple way to identify whether somebody has bought paid followers,” Asano says. But a high follower count is a good start. Influencers who get caught up in the fake-follower game fall apart as they get bigger. “If you have a half million or a million followers, and you need to buy some engagement on every single photo, that starts to get expensive after a while, and that’s when it starts to crack,” Asano says. Influencers need to maintain engagement as a percentage of their followers -- if they buy too many, the number of likes and views on each of their posts will be much too low, which will become obvious to companies. Another way to catch those who buy followers is to use internet metric sites such as Socialblade, which charts Instagram users’ growth history. “If there’s some huge crazy spike, it may be because they’ve purchased followers,” says Asano.

The best way to protect yourself from scammers may be to become Instagram fluent yourself. Follow people who do what your business does. Follow the people they follow. And approach influencers you’d like to work with, rather than the other way around. That’s what worked for James Tune, co-owner of the New York City bar Boilermaker, who approached @GothamBurgerSocialClub, an account with 154,000 followers, and @Devourpower, an account with 485,000 followers, and asked them to shoot his bar’s burgers. Tune gave the influencers a free burger and got tons more followers for his Instagram page. “Anytime I introduce a new food item, I ask Devourpower to come in,” he says. “My last post through them had about 45,000 likes. I’d say it was super successful.” 

You can also let someone else do the hard work. Some influencer-matching platforms, including the aforementioned Popular Pays, include Yelp-like star and comment-based rating systems so that brands have some idea of whom they’re hiring. Or you can partner with a full-­service marketing agency such as Socialyte, which will help your company develop a complete influencer marketing strategy and can match your business with a roster of fully vetted (read: real) influencers. 

If you do choose to work with one of these agencies, though, you should know how much all this costs. “A lot,” says Beca Alexander, president of Socialyte. “The average post is based on the influencer and what the product is -- how big a following they have, how consistent their content is and how in demand they are. But at the end of the day, we’re talking thousands, hundreds of thousands, millions for some of our influencers.” And in return? Your sales might skyrocket, or they might not. Instagram is tremendous at creating desire, but it’s very poor at leading people directly to sales links. Though the company did start allowing verified users to add hyperlinks to Stories in 2016, posts and comments are still unclickable and the hoi polloi can’t put hyperlinks anywhere but on their bio page. The thinking is, if you make people want your product enough, they’ll find a way to buy.

By avoiding formal influencer channels and contacting companies directly, I reduced the amount of scrutiny on my account enough to fool several people. The most expensive candle company on my list, Byredo, didn’t respond at all, but the other three got back to me within days. In fact, the first company to respond, the L.A.-based, all-natural candle and home-­fragrance brand Lite + Cycle, got back to me within hours. Kristi Head, Lite + Cycle’s owner, thanked me for reaching out but then disappeared. When I followed up, she offered me a 30 percent off discount code instead of free candles. As it turned out, she had scrolled through some of my old photos and saw that my aesthetic and backstory didn’t befit someone with 5,000 faithful admirers. “I noticed that your likes were really off. One image had about 100 likes and one had three likes, and I was, like, that doesn’t make any sense,” she told me later. “I have a pretty good instinct for this kind of thing. It’s really hard to fake a very genuine profile.”

I’d agree with her, but my candles from Linnea’s Lights have just arrived, in a box so large I thought they might be furniture for my neighbor. There are four candles in there -- thick tumblers of wax in scents like ink, forest fir, cashmere and Earl grey, plus an oil-based scent diffuser. The woman who sent them to me, Natalie Markoff, even enclosed a handwritten note saying that she hoped I would enjoy the candles. 

After the generous box of $16 to $34 candles appeared in the mail, I called Markoff to apologize for lying about who I was, and to ask if she wanted to talk about her experience “working” with me. Surprisingly, she did. (One other company also sent me free product but asked not to be included in this article, and huffily requested I return their candles, which I did.) 

How did my patched-together interior design feed convince Markoff? Basically, she’s a trusting person. She sometimes takes a chance on people who claim to be interested in the brand, whether they’ve got 150,000 followers or 2,000. She considers a gift to an influencer to be like a first-time discount -- a free week at the gym, say, or three free Blue Apron meals. An influencer is a potential customer, she says, with the possibility of also being more. “You’re just sharing an excellent product,” she says. “And the more people you can give that to, it’s putting good into the world.”

For Markoff, this strategy has led to partnerships that have paid dividends even down the road, including with an influencer who was doing an event in Portland, Maine, and liked the candles so much that she posted about them several times over three months. “I could just see our followers increasing, increasing, increasing, because she was posting about it in a meaningful way,” Markoff says. Because gifting can create feelings of reciprocity, this plan can be effective for many businesses, up to the point where an influencer sends a rate card requesting thousands of dollars. “My clients don’t pay to play,” Markoff says. It’s gifts or nothing, but gifts have created some serious buzz.

So -- based on a dozen interviews and my own experience as an influencer, should you do it? The fact is, you probably have no choice. If you want your brand to remain relevant to young people, you have to go where they are, and for now, that’s on Instagram. But be warned that the world of Instagram influencing really is like a gold rush. It’s boom or bust, and most of it seems to be happening in California. Spoken as a former piece of fool’s gold: Be careful out there. 

Images Powered by Shutterstock