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Episode 5 - The Future of Ecommerce: Influencer Marketing

From micro to macro, from celebrity endorsements of the past, to Tik Tok movements of the future, here's how we got here...

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Neal Schaffer
CEO, Author, Keynote Speaker
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Podcast transcript



Are celebrities already talking about your brand? I'll tell you how to find out later in the show.

Everyone's an influencer, but not all brands are created equally when it comes to the power of influencer marketing.

My Favorite Book (0:23)

Before we get going, I want to tell you about my favorite book. This is something that I think is important for people to know about not necessarily in Ecommerce but in business B2B, especially content marketing. Just a really powerful book that spoke really strongly to me. It's called They Ask You Answer by Marcus Sheridan.

And the reason I'm telling you about this book is because I have given away over 30 copies of this book. Every employee of mine is required to read it. I've given it to colleagues, to clients, to other business owners. I've recommended it to CEOs.

And the reason I do that isn't because, you know, Marcus pays me $5 a referral...

I don't make any money off of this. It's nothing along those lines. It's simple. I believe in the principles of the book, I believe it's really good. I believe that if people follow the book, not only will they make money, but they will make the world a better place specifically about this book. It's about transparency in business.

Side-rant on Transparency (1:25)

In fact, my entire business is predicated on this concept that the business world is specifically in my case, the Ecommerce technology industry is not transparent enough when it comes to pricing to what they actually do to their competitors and to whether or not you should buy their tool. And because they aren't transparent enough, I created, where we give these agnostic unbiased product reviews on the tools in attempt to show light on what they actually are from an industry standpoint, instead of from the tool providers bias, "I got to sell you, I got to make more money. I got to close sales," standpoint, right?

The Point: Influencer Marketing Exists Regardless of Whether You Use It Or Not (2:06)

And so because of this transparency that I think is very important in business, I recommend the books to friends. And in that way I am maybe one of Marcus's number one influencers that is never, ever paid a dime to.

And so that brings me to my point, influencer marketing is predicated on the idea that a friend telling another friend about your product will excite them enough to purchase. And of course not every friend will purchase. But what this means is that you can imagine there are some products and product categories that are just naturally things you really want to talk about.

And there are some products and categories that you just don't share with people you buy by yourself, or you just buy at the store, or it's really boring to, you know, no one really talks about they're replacing their light bulbs, or I don't know, buying frames, Michaels or whatever. It doesn't really, you know, become ultra viral.

But on the flip side, if you are using the Blendjet portable blender at work, people are going to ask questions when you turn that thing on. If you are using a teeth whitening system and your teeth look great, people are going to ask you how you got your teeth to look great, and you're going to tell them.

And so, as you listen to this episode, think specifically about your own product category and how kind of "viral" you are, and that will influence how you invest into influence marketing, whom you invest your influencer marketing efforts into, and how much.

With that said, I'd like to take you through from the past present to the future of influencer marketing for Ecommerce.

--- Intro clip ---

What did influencer marketing look like before the internet? (4:28)

What did influencer marketing look like before the internet?

Well, we had celebrities. We had the Jordans of the world. We had major press and media outlets that would promote brands.

And then, of course, along came the internet and social media, which truly democratized the power of influence. Kind of giving any person the ability to create content and share their influence with others really quickly, globally and intimately. I would say it's intimate as you can get in that type of situation, I suppose more intimate than a news broadcast or a TV or radio commercial that's for sure.

And so while the concept of influence hasn't necessarily changed, how we influence others has clearly changed. And it's important for you to understand this continuously changing dynamic and how it affects and influences your business and how to maximize value from it. So let's start with the basics.

The Pyramid of Influencer Marketing (05:36)

Let's look at the pyramid of influencer marketing, if you will, where at the bottom of this pyramid, you have your customers, your fans, the people that are already supporting you, your base, the large and often free audience who talks about you. You aren't really paying them anything. There's lots of them. And oftentimes, honestly, the word of mouth isn't even that well tracked, maybe there's a referral program or a loyalty program, but otherwise this is just natural virality around your business.

Then you have the micro-influencers step up from that. I'm just telling a friend here or there with probably a very small follower account per person. We now have people maybe in the 5,000 follower account around there who have influence and have been working, let's say on some form of their brand or personal brand or a business, and have basically evolved to either accept small amounts of payment in exchange for promoting products, or they will take products themselves to share and promote and review. And oftentimes the studies show that these micro influencers have a very niche audience appeal and can really get buyers motivated to listen to them because it's small audience, but larger than just a handful of people.

Next up you have your medium sized influencers who maybe have 50 to a hundred thousand followers, they're approaching a celebrity status and probably their accounts are growing quickly. Or at least I would advise you to check the growth of the accounts, because that'll tell you the health of these types of influencers, as far as an account status and how likely they are to perform for you. These influencers clearly have developed a standalone brand. They might not be full time in their career in influencer marketing, but they have a larger influence over an audience yet because of that overall size, they have lost a little bit of intimacy and maybe even a little bit of the niche appeal that they might have with their core base.

From there, we, of course, reach into the macro influencer, the large scale - 150,000, 500,000, million person following. These people are typically going to be receiving five figure checks to promote a product they're going to be really catering towards a mass appeal. Oftentimes they've had celebrity appearances, they've been on TV. They have some sort of, kind of larger reason for their fame, their internet fame. And that is how they have that large audience and mass appeal, which means a lot of people maybe have come around to follow them. And they obviously are less likely to have a strong impact with that entire audience. So you can imagine as this pyramid goes up and gets smaller and smaller at the top costs are going up and up as you rise to invest in one of these influencers and simultaneously you could say value per impression is going down slightly.

The Magical Sweet Spot of Influencers Social Media Following Size vs Engagement (8:42)

And so there is a magical sweet spot here in influencer marketing, where you can find the right dollar investment that maximizes your value per impression, based on somebody's audience profile. You know, if maybe if they're too big, they're getting followed for the wrong reasons, which we'll talk about later and they aren't going to convert for you. Whereas if they're too small, they might not really get more than a handful of sales for you and not be worth your time, depending on the scale of your business and how much you need to invest in order to get, you know, five sales or 10 sales here and there. So I want you to imagine this pyramid, as we continue to discuss influencer marketing.

Neal Schaffer (9:33)

With that said it's time to bring in Mr. Neal Schaffer.

"My name is Neal Shaffer. I am the president of PDCA social. You can find out more about my company and myself at and Neal Schaffer. I am also Neal Schaffer everywhere on social media:

And I also have a podcast called the Maximize Your Social Influence Podcast."

Derric Haynie:
Neal also wrote the book, The Age of Influence, and I asked him about how this whole influencer marketing thing really got started on social media.

"The past of influencer marketing is with the emergence of visual social media, specifically Instagram, Snapchat, YouTube. And now we have TikTok you know, companies have almost somewhat blindly thrown money at influencers in hopes that it will help their marketing. And I think now in 2020, we are getting a little bit smarter realizing that influence is not just about the numbers, but it really encompasses a lot of things. Some companies are deciding they don't want to work with as many influencers or they want to work with potentially influencers that have a smaller, more niche community where the chances of follower fraud and engagement fraud are even lower. So that is where today we see in technology, we see the use of artificial intelligence being used to try to find out who has real and fake influence in social media, and obviously try to avoid the fake.

So the industry is still maturing as we speak. I think, you know, the future is really realizing that everybody has digital influence to some extent some more than others, but if you are online and if you know, have online friends, and if you commonly post about certain subjects that others engage with, you begin to yield, influence, however, small it is about that subject.

So I think the future in Ecommerce is businesses really leveraging all the people around them that already have brand affinity for them. So instead of, you know, using influencer discovery tools to find influencers or go into marketplaces and trying to, you know, collaborate with people that may not even know you, or like your brand is reaching out to people that already do employees, partners, customers, your social media followers in collaborating with them.

And I think the other thing that we've seen that is going to be big in the future that we already see developing now is not just leveraging influencers for content amplification, but for content collaboration and even using influencers to replace your agency content studio, or in some instances, you know, bringing them in to become your in-house content studio."

First Takeaway: AI Advancements Make it Easier Than Ever to Measure Real Influence (12:16)

So your first big takeaway here, as Neal says, it's becoming easier to spot the phoney's. And in the past, people were buying fake likes and fake followers, and it was working. They were getting brands to pay them money. This will not happen anymore. This will never happen again. There's no going back and there will be significantly less fakes out there. And we will be understanding fake following versus real following. And those with real and authentic following will be rewarded. And that will help remove some of the landmines from the landscape of influencer marketing.

Second Takeaway: Influencers Replace In-House Content Teams (12:52)

Now, the second big takeaway from Neal and I hope you caught this, he's saying that as we progress into the future influencers may in fact, not maybe completely, but in a lot of ways, replace your in-house content production team instead of having a creative director and a content team, actually your creative director might be more overseeing influencer projects as opposed to having their own photographers and doing their own shoots themselves. Right? So we can imagine a future in which the creative is handed to third party influencers. And in that way, you're getting the benefit of extended reach and professional content being delivered because after all, most influencers are famous because they are good at publishing content. Let's go into even more detail as Neal describes it here.

"You know, early on, it was all about number of followers. And now it's not about number of followers. It's really about the engagement. Sure. Follower count is important, but it's really engagement. And it's really having a niche that's really important as well. So I think that as influencers you know, understanding that the technology exists to be able to find who has fake followers and who has real followers who has fake engagement and the algorithms themselves with every iteration get better at finding that as well. Right? So it becomes harder. And with the amount of apps stuff, I mean, if you've ever tried to create a really, really cool looking TikTok video, like you see a lot of TikTok stars have, you need a lot of time to sort of figure out the video tools and to be able to do what they do and, you know, high schoolers have the time to do that.

So that's why you see a lot of these new video and, visual mediums that they start with high schoolers and college students who have the time to burn, whereas us as, professionals may not have that time. So I do believe that because the eye gets trained to see more compelling visuals both static and moving, it gets a little bit harder, right? The barrier of entry, it gets a little bit higher and the barrier of entry for social media is low, but to be able to create that sort of content and build that community there's just a lot of people out there doing it. And the end product gets better and better. So I think it's changed quite a bit. And obviously the biggest change is from mommy bloggers to Instagrammers, YouTubers, right?

That's the biggest change it's, it's gone from the blogging medium to these other mediums. You know, I think going forward, what influences were realized. And it's really interesting. I especially, listen to a lot of Instagram podcasts and the first year it's all about all these growth hacks to get more followers, get more engagement. But then with every iteration of the Instagram algorithm, you know, somewhere 6 to 12 to 18 months down the line, you hear these Instagram podcasts was talking about email marketing. They talk about Instagram ads. At the end of the day, it's about omnichannel marketing. It's about being wherever your customers are. You still need to have a website. You should be doing email marketing and marketing automation. You're probably going to be doing paid ads. You know, you still need to be doing all of this.

And I think for influencers, it's the exact same. We saw influencers invest everything in Google Plus, and then boom, we saw influencers invest everything in their Facebook page. And then boom. And we've already had iterations of the Instagram algorithm where they've just seen less and less impact from their Instagram page. So it's, they need to build something that no social network can take away from them. Right. and that's sort of their own platform. That's their own website and their own email list. And I think you'll see more and more influencers realize that and really work on developing more of the same sort of omnichannel marketing that a brand might have."

Third Takeaway: Influencers are Becoming Brands and Brands are Becoming Influencers (16:35)

There's that magic word again? Omnichannel, right? I say it in almost every episode, we talk about the omni-channel experience and how influencer marketing is just one piece of the puzzle. What's fascinating here is that Neal is describing a world in which influencers themselves are working across multiple channels with their following. And maybe it won't be so interesting to know the follower count of your influencer, the next time you partner with them. But instead their email list size, or how many sales they're getting in their online store. And we can imagine if we extrapolate this out to the future, that every influencer will have a brand associated with them, they'll have some of their own products. It is not that hard to source and sell products and white label products these days. So it makes sense that if you are successful at marketing, then you will build your own product to move through your vertically integrated supply chain, right. Get rid of the brands and just do it yourself. So while influencers are becoming more like brands, brands are also becoming more like influencers brands themselves are creating strong and loyal followings with the rise of the digitally native vertical brand. And so we have an interesting intersection where the future will be more about brand relationships than raw influencers, posting products for money.

David Perry, CEO, Carro (18:06)

Which leads us directly into our next conversation with the CEO and co-founder of Carro, one of the hottest and fastest growing influencer marketing platforms around today. They have taken a bottom up approach to this market and you'll start to understand exactly what that means as you listen to David talk:

David: (18:32)
"It's actually not obvious because you hear about influencers all the time, but you don't really think about just how powerful they are. Like, I saw Ed Sheeran play at the Rose Bowl, like that's a big deal. Have you ever stood in the Rose Bowl and looked around at the audience? It's like, wow, that's so many people. And yet for an influencer there was one time I was shooting something in my studio and they brought their friends and I was looking around at them going. Oh, these influencers combined a 15 million followers, that's 166 Rose Bowl that they can reach. And when you start to put it into perspective, like what is the actual reach of these people? It is enormous. And so it caused me to start thinking about that. You know, there has to be a way to sort of get involved in the space.

And I asked them straight up, like, what's it like being an influencer? You know, how does it work? And I mean, cause they were, they were cool. They were sort of explaining it to me very clearly. They weren't making much money. They were turning down most of the deals that they got because they're always getting offered things, you know, we're Denver candles and you have to tell everybody, these are the best candles in the world. And they're like, I don't want to sell candles. I can't, I can't do this."

This is the first premise of Carro right here. They didn't believe in the brands that were pitching them.

"No. And they couldn't, their audience... You have to remember, it's such a different world. Celebrity means when you're familiar with somebody, if you're looking at Tom Hanks or Julia Roberts and they are, you know, 40 feet wide and you're staring at every port in their face, you become very familiar with them. And that was the whole idea of celebrity was that you really got to know these people. You could spot Tom Hanks at a hundred yards anywhere. But influencers, it's way closer than that. They're seeing them every single day. They see them in from every possible angle every day with their dogs and their house. And they have a real relationship in a way with that person because they know everything about them. And when they suddenly try to sell something, that's just out of band, the audience immediately feels that it's an offense take.

I think a good example of that I like to use is imagine you go to a conference and there's a sign on the wall and it says, 'Best Coffee Ever." And then someone takes a sip and turns around and goes, "Oh, that's the worst coffee ever." It's you know, who do you believe in that scenario? Is it the marketing or do you believe the person? And I think that's the thing that influences are doing is they're starting to really... they have they're earning trust and they have to manage that trust or fully. And so that's one problem you'll see, as a lot of influencers are just constantly shilling stuff. If you look at their feed, it's just a whole bunch of random objects being sold. I don't really consider those as actual influencers. I think of the real ones are the ones that have the real low loyal followings, but they can really move the needle for a brand that they love."

Fourth Takeaway: Authenticity (21:36)

So of course the big takeaway is focusing on authenticity of the influencers that you work with. Let's hear David describe that as far as how it got him started in running a company focused on authentic influencer marketing.

"It's a real problem. You'll find a bikini company will spend their entire marketing budget, hiring one influencer. Who's beautiful to wear their bikini and sales don't happen. And it's exactly for that reason. It's because all of her followers are male. This happens quite often as well, where the, you have to ask yourself, why does this person, who are these followers and why are they following? Another example I like to use on what really got me interested in this space that really got me rolling. I was watching an influencer Casey Neistat. He got wealthy and he doesn't need the post anymore, but he at the time he was posting every day and I found myself living in the world of Casey Neistat. And what happened was he once flew on Emirates Airlines and Emirates somebody pointed to him and said, that's Casey Neistat.

And so the staff upgraded him to first class, and then he made a video of what it's like to be on Emirates in first class. And it was what, 73 million times on YouTube. And so the question really is what would it have cost if you wanted to buy 73 million views of a video? And so this idea that someone would point to them is really what inspired us is can we do that at scale? Is there some way to do that, with data and at scale, and can we point to these important people and help the brands pay attention to who they're interacting with? And we've done it over 6 million times at this point. So we've found lots of really important people. And it turns out that when brands first do this, they realize that they've missed a lot of opportunity that they've had the Casey Neistat's go by a lot."

And let me briefly pull it over to one other example, just to make sure you're really getting the point here.

"Another thing that happened was we once went to dinner with my daughter and a whole bunch of friends, and one of them was an influencer as 12 years old. She had her "momager", you know, they call it your momager was there, she's making $30,000 a month. And she explained they'd just been to a conference which was like some kind of make-up conference. And her hotel room was actually covered in makeup to the point that every single surface, the entire bed, the window sills, every shelf, everything in the room was covered in makeup. And the joke was that she doesn't wear makeup. And so someone's paying to put all that stuff in the room, thinking that if they can just get it in the proximity of an influencer, everything's going to go great. Right. And that's not real either.

What she does is she actually videos the room because he thinks it's funny. And then she leaves and all that makeup throwing out. And so that, that is that's the harsh reality of when things can go wrong. But one of the girls at the table asked her about her backpack which was this really cool white backpack that she had. And she started gushing about it. Oh my God, I love this backpack. I think it, everywhere I go and all the other girls were like, I really like it. What's the brand? How do I get one? And I'm sitting there going, are you kidding me?"

And she sells 10,000 backpacks...

"I want to be the backpack company. Right? Cause this, that relationship is the authentic, the makeup relationship is just silly and a huge waste of money. And so these are the formational things."

So, Are Celebrities Buying From You and How do You Enable it? (25:20)

So now that you, I hope certainly are believing about what authenticity really looks like. Let's go back to the question from the top of the episode are celebrities buying from you? Can you find the celebrities in your audience? The answer is yes. You need to be starting your influencer marketing a bit closer to home with those who have influence and are already fans of yours. From there, you migrate outward to people who are fans of things related to your space and your industry. And then from there, you find influencers that are maybe more tangential in nature. I feel like most people launch their influencer strategy and start the other way around trying to go too far outside of authenticity and too far away from what they really do or believe in what the influencers really do or believe in.

Tech Tool Highlight: Carro, Brand Partnerships (26:22)

So if we put this all together, we can imagine that we are looking for influencers that are more authentic. These influencers are building their own brands and maybe even selling their own products. And we are becoming more influential as brands ourselves. So there is a natural progression into a really unique tool that Carro has recently launched called Brand Partnerships. I'll let David explain how it works.

"There's a new thing that we've added due to COVID because what happened was a lot of retail stores shut down and sent all their products back. And so what we did is we realized that is there a way we can get the brands to be able to stock products virtually? So instead of having to buy a pallet of gloves and then, like say you're a bicycle company, instead of buying a pallet of gloves and bringing them all the way over to your warehouse, and then hoping they sell, and you only bought one glove cause you don't, you know, you only bought one, a one style because you don't want to take a risk and all the styles cause who knows what people want. The idea of just doing everything virtually, because we're built into their systems, that's actually effortless for us.

So we take, you could take all the gloves from the glove company, from the bicycle glove company, put them on your bicycle site and sell them. And  you become the retailer. So you get to actually keep the retailer cut of that and they'll do fulfillment. And that's something the world has changed. Now we understand like with that scene in an eBay and everyone and Amazon, that boxes arrive from different locations when something is being fulfilled. But the idea that you're not moving products around anymore and hoping to sell them, there's no need to move the product until it's actually sold is way more efficient."

Hammer it Home, Derric (28:23)

This could be it. This could be the Holy Grail for influencer marketing for a lot of merchants out there. Let me hammer home what I'm talking about:

A lot of brands come to me and say; "Derric, how do I increase average order value?", "Derric, how do I find influencers that will help me sell my product?"  Well, now we can actually do these things together by putting an influencer or another brand who is also essentially an influencer, putting their products on our site, bundling them with our products, possibly leading to even co-branded partnerships, but just starting with the basics.

We can now offer the gloves with the bicycle. We can offer the bell with the bicycle and we don't have to sell the bell. And this is fundamentally different than the existing model of dropshipping. Let's say, that model is passed through where you're essentially white labeling products.

Here, you are bringing in the Shopify data from the other merchant and you are putting it on your store and they are fulfilling. And you are getting a promise of a increase in revenue and without any additional risk or burden to you and in doing so, they want to promote you. You want to promote them both brands, or if it's an more of an influencer and a brand, everyone is winning. You can also imagine how putting your product on influencers stores will benefit you and your exposure. And perhaps in the very near-term future, influencers will sell placements on their store.

Bringing it Full Circle (30:01)

So if we think of this full circle, it started with mommy blogging. It moved to Instagram and YouTube, and then it moved to omnichannel influencer consumer relationships. And now, the influencers having built their own brands will actually be able to sell the space in their Ecommerce store to other brands.

And of course, they're not going to sell it maybe as a, maybe there's a listing fee, the same way you get the end of the aisle at the grocery store for $10,000 a month, or whatever that price point is. I hear it's a lot. You will have a, maybe a listing fee, but then you will also be charged on every order.

So it will be a performance based component. I'm certain that's how brands will break this down and want to work with influencers.

And in this way, influencers are grabbing margin from the brands as influencers essentially are another acquisition channel, which of course they always have been, but instead of acquiring the customer directly on my own store or having the influencer post and send traffic to a third party, myself, my store, they are sending it to their own store.

And then we are being placed in that store so that the consumer has the utmost amount of trust for the influencer.

But we are also perhaps able to grab that user and bring them into our brand, and make them aware of our brand, and sell them on our brand.

To put it simply, Ecommerce brands can now operate more like retail than ever before, by putting products on the shelves of other people's digital stores.

I am so bullish on this, and I would love to hear if you have tested this strategy for you, I have started recommending it to brands. It is a full-fledged campaign strategy.

It doesn't necessarily happen overnight, but it is a way to deepen relationships with influencers, which perhaps brings me to one final point.

Working with a handful of powerful and well-aligned influencers is significantly better than trying to bring in truckloads of influencers who know nothing about you, who you know nothing about and who you maybe can't support because you don't have the bandwidth for.

So start slow in this process, choose the right people and prosper.

Final Thoughts (32:47)

That is it from me. If you enjoyed this episode, I'd love it. If you could give us a review on your favorite podcasting platform to check out the show notes of this episode, you can visit us at

And we have just launched a new website with a new podcast section BIGGER and BETTER than ever. I would love your feedback on it. Check us out at

I look forward to seeing how your influencer marketing program progresses as technology changes and social media and social media dynamics continue to change. And I will see you in the future.

I'm Derric Haynie, your host.

Please email me with your feedback, requests, questions, problems, or if you'd like to be on an upcoming episode, it's