A young woman spins in front of the camera wearing an evening dress. Her name is well-known online: Claude Beauty is all about beauty, fashion, and lifestyle. In one video, she talks about her wedding preparations, casually mentioning the brand name „Nivea“. What seems like a recommendation from a friend is actually paid content, with corporations like Beiersdorf paying very well, depending on the influencer's reach. With short videos – known as „Reels“ in industry jargon – influencers can earn several hundred to several thousand euros per post.

Corporations are spending more on influencer marketing, and the industry is becoming increasingly professional. It's no longer just about attention and image building – the success of campaigns is becoming easier to measure. Beiersdorf, for instance, confirms that influencer marketing plays a crucial role, and its budget for this area has „continuously grown“ over the years. Beiersdorf collaborates with the social media agency Intermate from Berlin on influencer marketing.

Intermate CEO Philipp Papendieck has also signed contracts with Unilever, Meta, Mercedes-Benz, and Deutsche Post. „Unilever CEO Fernando Fernandez alone is allocating 50 percent of his advertising budget to social media, and plans to increase spending on influencer marketing twentyfold“, he explains. For others, it may only be 10%. He notes that responsibility for this area of the company's strategy is increasingly being placed in top management.

And even though analysts haven’t yet focused specifically on this area, and tend to look at marketing strategies more broadly, Papendieck notes that "companies preparing for an IPO are coming to us more frequently, wanting to expand their influencer marketing quickly to position themselves for the future.“

For certain campaigns, corporations are willing to spend seven-figure sums on social media campaigns. Of course, they have high expectations. According to Christoph Kastenholz, co-founder and co-CEO of the Hamburg-based influencer marketing agency Pulse Advertising, companies primarily aim for customer acquisition. Kastenholz works with notable clients like BMW, Nestlé, Blackrock, Telekom, H&M, and Hugo Boss. „In the past, social media was treated more like PR because it wasn't measurableÄ, he says. But times have changed.

Pulse Advertising tracks, among other things, how many new customers their campaigns bring to corporations. The average customer acquisition rate for campaigns is 70%. That means 70% of those who see the campaigns and make a purchase are new customers. This can be tracked via links when products are tagged or when influencers use codes. Customers entering a discount code during checkout that can be clearly attributed to an influencer is another way.

A further key metric for companies is the Customer Acquisition Cost – how much does it cost to acquire a new customer? In addition, the agency has developed an algorithm that calculates that for every dollar spent on influencer marketing, the „media value“ rises by 7 to 12 dollars. The agency compares: „What have I invested, and what do I get? Reach and interactions versus purchases.“

Intermate has developed its own methods for tracking success, even hiring a professor for data science. They look at how often posts are shared or liked, as well as the number and types of comments. All of this is analysed and contextualised.

The idea that today’s smart minds are calculating the impact of influencer campaigns on corporate revenues was not even a topic ten years ago. Kastenholz recalls the early days of his social and influencer marketing agency in 2014. Back then, he had to knock on doors, cold calling potential clients and hearing, more than once, „We don't need influencer marketing“ or „Instagram isn't relevant for us.“ The winds have clearly shifted. The number of inquiries to his agency has grown. „We turn away many clients today“, he adds. The agency now works with around 100 clients.

Intermate does not disclose the number of its clients. Similarly, corporations themselves are typically reserved when it comes to discussing figures.

Fashion and cosmetics are a perfect fit for social media. Claude Beauty’s face cream video has already been seen by more than 200,000 people. However, anyone thinking influencer marketing is solely a beauty sector trend is mistaken. One of Pulse Advertising’s clients is Blackrock. The US investment firm uses Intermate’s agency to promote its ETFs to younger generations through YouTube videos.

Influencers have become highly important for companies. Evidence of this is the continual mention of the topic in annual reports. Notably, French consumer goods giant L’Oréal frequently references it. In response to an inquiry, the company stated: „Since influencer marketing is a fixed and ever-growing component of our marketing mix, and we are investing accordingly, the area has gained increasing importance for various stakeholders, including investors and analysts.“

The topic is also often mentioned in the company’s annual reports in relation to risks. Of course, corporations must ensure that influencers don’t harm the brand. A notable example, this time involving a celebrity influencer, is Adidas. The sportswear giant worked with rapper Kanye West until October 2022, when his racist and antisemitic comments led to the end of their partnership.

Since companies can't monitor every communication by influencers online, control mechanisms are in place. For example, image and text recognition technologies are used to detect comments, such as whether someone has expressed views related to the far-right party AfD. As a result, some companies are trying to exercise more control over content. However, this is challenging because the influencer business thrives on the very thing that makes it work: influencers like Claude Beauty simply recommending what they genuinely like – in their own words and style.