KoRo | Updates

By Constantinos Calios

How KoRo’s Influencer Marketing Drives Sales

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Dear Companists,

We are back with our 18th update. We want to welcome all of our new Companists and thank you for your investment and confidence in our business.

First off, our annual financial statement for 2017 is now also available in our overview under “Documents” for all potential Companists to see.

We are still overwhelmed by the many positive messages and the great success of our equity crowdfunding campaign. It makes us particularly proud and motivates us to continue putting in our best effort.

In this update, we will provide deep insights into our influencer marketing department.

KoRo has historically grown through influencer partnerships. We already discussed this in the last updates and addressed the relevance of influencer marketing for KoRo in update no.16. Today, we will talk about the means we use to evaluate influencer marketing, how we conduct our acquisition, and which aspects are relevant for us in order to assess when a partnership is a "good" one.

 

A. Background and Outlook

KoRo was one of the first companies to work with influencers in 2014. We started with YouTubers, who had established themselves as vegan bodybuilders in the fitness scene. The mention of KoRo products, e.g. when unpacking the goods package ("unboxing") brought us a leap in sales compared to "normal" sales at that time. What was particularly decisive for us in order to continue investing in this channel was the fact that the daily average sales also remained higher than before.

 

 

KoRo - Sales history 2014 

 Here is a great example from 2014 (Date, Revenue, Orders).

 

Today, the market has changed fundamentally in terms of price development and recommendation, but the tools used have not.

Influencer marketing is still one of the best sales channels for KoRo. Please refer to the aforementioned update to see which other strategies we pursue in order not to be dependent on influencers.

 

B. Acquisition Strategy

Two things are necessary before acquisition:

  1. A system that allows for fast acquisition and is strongly process-oriented.
  2. Clear communication in acquisition and focus on the essentials.

 

How we solved these points:

1. We work with a predefined system of different text modules, with which we can directly summarize the relevant information for the respective influencer in an email. If we receive a response, there is an appropriate gradation depending on the reaction. Text modules have the advantage that requests can be sent relatively quickly by email.

 

2. A specific example:

  • Acquisition of a food influencer on a commodity value basis:
    During the initial contact, we communicate the relevant KoRo USPs and the advantages of the cooperation for the influencer. It is imperative to name the price because the influencer sorts his offers accordingly.
  • If the influencer declines the cooperation:
    Follow up directly with module.
  • If the influencer agrees, we communicate the process directly, the cooperation starts immediately with smaller partners, with larger ones depending on the planning.
  • If the influencer only partially agrees, the discount or compromise is determined according to the "type."

 

C. Evaluation Tools

We work with placement lists to control placements. This means that the influencers have to send us a monthly overview of their placements as proof. We then check the placements to see whether our logo, a product, and a link have been placed and, if necessary, provide tips for better placements.

This is also solved via a standardized modular system, where every case that has already occurred has been implemented in a process.

In order to measure the success of our partners, we use 5% vouchers, which some Companists are probably already familiar with. The advantage of vouchers is that the probability of redeeming them is very high. In the early days, we used affiliate-based or Google Ref links with the influencers. The disadvantage is that you can bypass tracking by opening a new tab. We treat all partners equally so that everyone receives the same voucher discount. We can then analyze directly how each partner plays in:

 

KoRo - Revenue Influencer

Period 15.07.2018 to 15.08.2018, best sales.

 

The names of the respective partners are on the left side, but we are not allowed to mention them for contractual reasons (confidentiality agreement with the partners). Nevertheless, it is quite exciting to see that a single influencer continues to generate respectable sales. Partners with whom we have no ongoing cooperation, but through whom we still generate sales, are also included. This, of course, is the effect we want to achieve.

 

D. Which key figures are important today for successful influencer marketing?

As a rule: One's own remuneration, which one is prepared to pay, should be set as conservatively as possible and only depend on objective criteria. In addition, one should avoid working with agencies or platforms that mediate these. They usually charge a commission of up to 30%, which the company must pay itself. Furthermore, the referral character of such partners is 0.

There are a number of key figures that we look at to determine target compensation. This is either in a package of goods, in a fixed remuneration, or in a combination of both. These are:

  • Number of followers
  • Click rates per video
  • Like/ dislike ratio
  • Number of comments under the video
  • Number of placements for other businesses (“selling out” of the influencer)

 

All these key figures must answer the following question: How strong is the influencer's attachment to his followers? Experience has shown that greater viewer loyalty means greater receptiveness to product placement. That's why we collaborate regardless of the type of influencer, meaning that we work with both food and comedy influencers.

We carry out the documentation in a central database. 

 

E. Runtime and Customer Lifetime Value

The runtime always depends on the size of the partner. Small cooperations can be terminated on a monthly basis; large cooperations usually run for at least 6 months.

To extend collaboration, it is crucial for us, in addition to the points listed under d), whether the cooperation was profitable for the company as a whole, i.e. whether we have recouped our marketing costs through the cooperation. We can only be certain that this was a relevant recommendation that brings long-term customers and has a corresponding impact on customer lifetime value (CLV) once marketing costs have been recovered.

This approach of the CLV has a clear advantage: If you adopt a theoretical CLV, as with classic performance channels, the company may always be dependent on marketing until the assumption is fulfilled, when the marketing costs are reduced, causing a decrease in sales. Not so with us.

I admit that good cooperation in this form is difficult to find, but we have succeeded quite well so far. We also have new partnerships in the works, which we will tackle directly when the second investment threshold of EUR 400,000.00 is reached.

 

Best greetings,

Kosta



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