Influencer Marketing Fraud: The Shady Side of Social Media

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September 12, 2018 10:00 am Published by

influencer-marketing-fraudThe great thing about social media is you can become anyone you want to be. The bad thing – at least from a brand’s perspective – is that you may not exist at all.

If your brand works with paid online influencers, you’re probably familiar with one of the technique’s biggest risk factors now: influencer fraud – a dilemma that occurs when paid tastemakers use artificially inflated follower numbers to increase their asking rate for engaging their audience on behalf of a brand.

What was once an isolated trend has exploded in recent years, to the point where the digital landscape is reeling from all that fake follower activity. To put the scope of the problem into perspective, up to 20% of mid-level influencers’ followers are likely fraudulent, according to a Points North Group study.

Up to 20% of mid-level influencers’ followers are likely fraudulent via Points North Group study. @joderama Click To Tweet

Regardless of whether an influencer partner intentionally participates in deceitful practices or may be an unwitting victim of a third-party effort to game the system, the cost to your business – and its content – remains the same: precious budget dollars wasted to curry favor with fake followers.

And, even if you aren’t paying popular social stars to help drive interest and increase reach, your content marketing activities still may not be immune to fraud and other influencer marketing pitfalls – as you’ll see from some recent news stories.

Social media shakedown

The magnitude of social media’s shady side is sending shock waves up and down the digital landscape – starting with the social networks themselves.

For example, a New York Times investigation recently revealed that 15% of Twitter users were likely automated accounts designed to simulate real people. Twitter responded by embarking on the “great purge of 2018,” shedding millions of locked accounts, which carried a higher likelihood of being fake. According to several sources, including Variety, Twitter’s purge resulted in significant follower count drops for some of the platform’s most powerful influencers – including an estimated 7.5 million from its @Twitter account.

15% of #Twitter users are likely automated accounts designed to simulate real people via @nytimes. Click To Tweet

Read: Big Twitter Accounts See Follower Numbers Drop After Fake-User Purge

Trickle-down marketing economics

The realization that their faith in influencer endorsements may have been misplaced has many consumers feeling swindled by their favorite social networks – Facebook chief among them. When news of Facebook’s bot problem surfaced, it seemed likely that eroded trust would drive scorned users off the site. Those chickens may just have come home to roost: TechCrunch and MarketWatch, have cited growth and engagement declines as contributors to Facebook’s recent market cap drop of $123 billion ­– more than most startups or public companies are ever worth.

Read: Facebook loses $120 billion in market cap after awful Q2 earnings

Consider: For content marketers, follower reductions on your brand’s social profiles due to scrubbed accounts or mass exodus from the social channel can amount to millions in wasted ad spending. CMI founder Joe Pulizzi has pointed out the fragile nature of marketing on “rented” social media lands, citing the likelihood of these channels unexpectedly changing their rules and decimating the consumer relationships you’ve earned on them. The potential for your brand to get unwittingly caught up in spambot warfare is yet another reason to follow his advice and focus on building your content audience on channels you fully own and control.

Build your #content audience on owned channels to avoid getting caught in social spambot warfare. @joderama Click To Tweet

Can brands tackle the issue downstream?

If consumers’ trust in social media remains in free fall, will the rest of the marketing economy be dragged down with it? Not if companies like Unilever have anything to say about it. As reported in The Wall Street Journal, the consumer-products giant, which spent more than $9 billion on marketing its brands last year, is looking to crack down on fraud by banning influencers who pay for followers or use other deceptive means to inflate their rankings. Keith Weed, Unilever’s marketing chief, has been particularly vocal in his desire for greater social marketing reform as well as in calling for an increase in measurement and oversight to ensure that problems like this get solved.

.@Unilever may ban influencers who pay for followers or use other deceptive means to inflate rankings via @WSJ. Click To Tweet

Read: Unilever Demands Influencer Marketing Business Clean Up Its Act

And, speaking of weed …

While it doesn’t involve an act of fraud, another recent story on influencer marketing partnerships has risky behavior practically written all over it: Digiday recently reported on the ways cannabis companies are enlisting influencers to help them attract new customers in places where recreational use is legal. These efforts skirt the ad bans established against the industry by Facebook and other social platforms. For example, MedMen is using Los Angeles-area micro-influencers as part of a $4 million campaign promoting its retail outlets in high-end shopping districts.

So far, most influencers seem reluctant to risk the potential social media and legal repercussions of endorsing a product banned on the federal level in the United States. But this may change as the cannabis industry continues its quest for full legalization and further legitimization.

Read: Cannabis Brands Want to Try Influencer Marketing, but Influencers Are Wary

Consider: Even if your designated brand influencers aren’t tempted to work with risky businesses like MedMen yet, it doesn’t mean they aren’t engaging in other questionable activities, personal proclivities, or conflicting client relationships that could come back to haunt your brand if they come to light. To minimize the potential for unpleasant surprises, look for influencers whose social personalities align strongly with your content strategy and mission statement, and be sure to go beyond their follower counts when researching the benefits they might offer your brand.

Look for influencers whose social personalities align strongly with your #contentstrategy, says @joderama. Click To Tweet

Fighting bots with bots

If you can’t beat the bot-follower problem, why not embrace the technology enabling it? That’s a question some brands are asking themselves as the possibility of using virtual influencers – online personas fashioned wholly out of the imagination and programmed to interact as a real person would – takes shape. As Adweek recently pointed out, working with these artificial intelligence-driven accounts eliminates the threat of a spokesperson going rogue while still tapping into the massive, engaged audience that these mecha-marketers can amass. While intellectual property ownership, morals clauses (covering the creator, not the actions of the bot itself), and ability to sustain long-term engagement are among the potential business and legal pitfalls, it’s not too far-fetched to believe that “Pu-Δ-π” -could someday be considered a safer alternative to working with the PewDiePies of the social world.

Read: Brands Are Creating Virtual Influencers

How to spot frauds

In a world where machines can simulate human emotion, politicians’ tweets seem to be devoid of it, and a well-dressed pug can earn thousands of dollars per Instagram post, how can you tell which influencers offer authentic engagement and which ones are flashy frauds?

MarketingProfs recently addressed this question with a list of clues that can help marketers discern the methodology and underlying mechanisms an influencer uses, as a way of determining its authenticity and worth.

Read: How to Spot Authentic (and Fake) Instagram Influencers

Content conclusion

Social media’s power and popularity enable practically anyone to build a public-facing persona, grow a following, and serve as a pitch person for your brand and its content. But if you want to tap into an influencer’s pool of loyal followers, you should make sure what they have to offer is more than a shallow mirage.

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Cover by Joseph Kalinowski/Content Marketing Institute

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