The Engagement Rate

An industry bulletin for marketing pros.

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Why influencer marketing costs are skyrocketing – and how smart brands are adapting

Influencer marketing isn't as straightforward as it used to be. As the industry grows, so do the challenges—and costs. Today, influencers are more business-savvy, often working with agencies that drive up their rates. So, how are smart DTC brands adapting? Let's dive in.

The price surge

Influencer marketing is no longer a bargain. The average campaign revenue for Instagram creators shot up from $3,653 in 2021 to $5,111 in 2022. Talent agencies streamline collaborations but also jack up prices and extend timelines.

How DTC brands are fighting back

Youthforia’s lean approach:

• Minimal paid campaigns: High costs and uncertain returns make extensive paid campaigns impractical.

• Ambassador program: Launched a month ago, it targets college students, gaining nearly 600 ambassadors who receive free products and discounts in exchange for social media posts.

Experiment’s organic growth:

• Leveraging TikTok: Co-founder Lisa Guerrera uses her own TikTok presence (61k followers) to build genuine relationships with creators.

• Product gifting: Focusing on organic content with a curated group of creators, relying on the authenticity of their reviews.

Apothekary’s authentic content:

• Micro- and macro-influencers: Found success by partnering with influencers who create raw, relatable content.

• Creative freedom: Shifted from polished videos to allowing influencers to produce their own content, which resonated better with audiences.

• Special offers: Limited-time offers proved far more effective than generic calls to action.

Navigating the new landscape

Measuring success: The ambiguity of key performance indicators (KPIs) remains a challenge. Agencies and brands are focusing on testing different tactics and ensuring all campaign elements align with broader goals.

Local and regional influencers: Square Root Creative found better engagement and ROI by working with local brand advocates rather than big-name influencers.

Creative freedom: Brands like Apothekary and Experiment have seen better returns by giving influencers more control over the content they produce, resulting in more authentic and engaging posts.

Final thoughts

As influencer marketing evolves, DTC brands must innovate to stay ahead. By focusing on authenticity, leveraging strategic gifting, and giving influencers creative freedom, these brands are not just surviving—they’re thriving.

Billboards on wheels: bow Adgile is revolutionizing truck advertising

Imagine seeing a truck with a brand’s ad and assuming it’s delivering their products. Chances are, it’s not. Across North America, last-mile delivery trucks are turning into mobile billboards for brands like Glossier, Crown Affair, Jolie, August and Olipop, thanks to out-of-home advertising companies like Adgile.

Adgile’s rise: Founded in 2020, Adgile has connected small businesses with unbranded trucks, completing over 400 campaigns. Their revenue surged from $1.7 million in 2022 to $3.3 million in 2023, and they’ve already hit $2.5 million this year.

The appeal: Tom Shea, co-founder and CEO, highlights that the stealthy nature of these ads is their biggest draw. “It’s the only form of advertising that no one knows is a form of advertising,” he says. This unique approach is changing the out-of-home (OOH) industry.

Billboards on wheels: Initially, Shea and co-founder Max Flannery envisioned digital screens on interstate trucks. Realizing the high costs, they pivoted to static ads on urban last-mile delivery trucks, which often park in highly visible areas during the day.

Targeting and performance: Adgile’s clients, mainly DTC and digital-first brands, benefit from targeted routes and visibility. Contracts averaged $72k last year, with specific requirements based on daily website visitors and physical points of distribution.

Measuring impact: Adgile uses GPS tracking and device ID matching to measure ad effectiveness. They employ "ghost trucks" to create control groups, comparing conversion rates to those exposed to actual ads.

Creative strategy: Adgile’s design team uses data to optimize ad visuals. Red, a high-performing color, and purple, rarely seen in nature, are top choices. For example, a truck featuring Glossier’s You perfume, emphasizing red and pink, recently drove near Smorgasburg in Williamsburg.

Looking ahead, Shea envisions integrating digital screens as the OOH industry evolves. Adgile aims to stay ahead of the curve in the programmatic digital OOH wave.

Adgile’s innovative approach to mobile advertising is not just about placement; it's about creating serendipitous moments and making sure ads are seen in the right place at the right time.