The whole industry is so messed up': Google may finally be bringing some order to the messy influencer sector
- Google's CEO Sundar Pichai last week talked up FameBit - an under-the-radar influencer platform the company purchased in 2016.
- FameBit is now helping broker deals between YouTube talent and brands while taking a 10% cut of the deals.
- This has the potential of bringing order to the highly fragmented influencer marketing sector.
- It also put Google in an atypical role of servicing creative campaigns, something it's historically been happy to cede to third parties.
Google is looking to bring some order to the chaos that is influencer marketing.
Specifically, YouTube, through its 2016 acquisition of the influencer-centric firm Famebit, is connecting YouTube creators with brands, and facilitating the creation of sponsored videos. The unit got a rare brush with fame last week - a shoutout on Google's otherwise low key earnings call.
"Half of the creators that used FameBit in the first three months of 2018, doubled their YouTube revenue," said CEO Sundar Pichai during the call.
YouTube has historically shied away from this labor intensive, service-oriented aspect of the business, leaving that to multi-channel networks like Fullscreen or Maker Studios (which eventually sold to Disney), talent rep firms and a host of ad agencies, PR shops, and influencer database startups.
But in the past few months, via FameBit, Google has increasingly been playing matchmaker with brands and YouTube talent. And unlike in the past, it's getting a cut of branded content cash, which previously went straight into creators pockets.
Among the many questions going forward: Is Google getting more serious about brokering YouTube ad deals good or bad for other players in the space?
FameBit connects YouTubers with brands - and makes Google money
The idea behind FameBit is to create a digital marketplace that aspires to make influencer brand deals as 'programmatic' as possible.
Veteran YouTube sales executive Beau Avril, who's FameBit's global head of business operations, said that brands can log into a self-serve digital interface, post an opportunity for a sponsorship, and quickly connect with thousands of creators if they are interested.
Google takes a 10% cut of any deals that result. The company acts as facilitator, stewarding the execution of branded videos. But YouTube leaves the production to the creators.
The company says that in the first quarter of this year, 90% of FameBit campaigns drove 20 times the usual search queries for those advertisers in the four hours before or after viewers watched the brand funded creator videos.
"Brands like the 'self-service' element to the platform," said Benjamin Arnold, managing director at the agency We are Social. "This is a really attractive selling point for them."
YouTube's ad sales team has been out selling FameBit deals as part of large ad packages. FameBit also had a big presence at the web video industry/fan event VidCon in June.
In its pitches to advertisers, YouTube is touting its unique ability to measure the impact of marketer-funded YouTube videos on everything from brand perception to search traffic on Google.com.
"One of the most exciting pieces is the measurement side," said Avril. "We can we show brands what happens in search when creators talk about their products."
"The offering is pretty soup to nuts."
Recent examples of FameBit-driven deals include a series of influencer-produced videos for Canon, as well as the peanut butter brand Jif.
Gemma Stafford, who runs the four year old Bigger Bolder Baking channel, has previously worked with advertisers through multi channel networks (MCNs) and directly. She's recently inked several brand partnerships using FameBit, including a video for the Google Home mini device, as well as a clip centered on Oatmeal cookies sponsored by Keurig.
"The fact that they align themselves with quality brands makes us want to work with them," said Stafford.
Influencer marketing is still messy, and has taken a beating recently
There are umpteen ways that marketers can connect with digital creators. For a while, the YouTube ecosystem was dominated by MCNs like Maker Studios and Fullscreen.
More recently, there have been hundreds of influencer networks and tech firms promising deep databases of talent and close-to-automated deals. Not to mention ad agencies, PR firms, and brands themselves all looking to execute influencer initiatives.
"There are still eight ways to make these deals," said Eric Johnson, founder and president of the digital ad agency Ignited.
Amidst that fragmentation influencer marketing has taken a beating for not only being tough to measure, but plagued by creators trying to inflate their numbers
In fact, Unilever's chief marketing officer Keith Weed recently pledged to no longer work with any influencers who pay to boost their follower counts.
"The whole industry is so messed up," said one digital media insider. So maybe Google can fix it?
Google can theoretically bring scale, organization and credibility to influencer deals
Ironically, all the recent brand safety snafus in digital media, and on YouTube in particular, may help FameBit. Huh?
Well, as the thinking goes, why work with a random third party that may have partial data and indirect relationships with talent, over a company like FameBit that is directly plugged into YouTube's tech, and presumably knows which influencers are both prominent and safe?
In other words, FameBit comes across as being more legit, since it's part of Google.
"It's really smart," said Nick Cicero, founder of the social analytics firm Delmondo. Finding the right influencers to work with "is still the biggest problem for brands."
So what happens to other players?
Whenever Google enters a market in a serious way, some see it as a sign of validation, and others worry that their business is about to be trampled.
Some influencer talent rep firms said that FameBit had helped steer deals their way. But they often wonder, are they helping, or getting in the way?
"There is a disintermediation, and consolidation coming to this market, no question" said Ryan Detert, CEO of the influencer tech firm Influential.
That doesn't mean that Google necessarily takes it all. For one, FameBit primarily works with YouTube, and brands want influencers on Instagram, Snap, etc.
"It's still too early to say the market has been radically upended by Google," said Mike Dossett, VP /Associate Director, Digital Strategy at the ad agency RPA. "But there's no question that, as a whole, the space itself is finally arriving at a long overdue turning point."
Dossett said that for influencer brand deals, pricing and measurement tend to be all over the places, and there's an "overabundance of middlemen."
"Google's sheer market-shaping power and their stewardship of one of the leading creator environments has the potential to accelerate the long-awaited maturation of the influencer space," he said.
Yeah, but is this really worth Google's time?
Several digital insiders scratched their heads when Google bought FameBit. After all, the search giant is known for using data and tech to zap perfectly targeted ads to people on the web.
Making branded content videos, making clients happy, getting creative right - that's not typically the domain of a neutral tech platform. It's ad agency, production company type work.
And not only can branded content shows be time consuming, some wonder whether the payoff is worth it. Is 10% of a handful of six figure ad deals going to move the needle for YouTube?
"No matter how you look at it, these deals are hard to scale and have lower margins," said Gabe Gordon, co-founder and managing partner of Reach Agency, which specializes in branded video content.
Digital creator Sam Tsui said he's worked with brands every which way on YouTube - and recently produced a video for NBC to promote "The Voice" that was brokered through FameBit.
"There was nothing automated about it," he said. "It felt like other deals I've been a part of. There were drafts, approvals, etc."
Still Tsui raved about the experience. "YouTube's been really good about engaging and lifting up their creators. So it's exciting to know that a player like FameBit has this sort of backing from and the association with YouTube."
Google loves to tout when they are helping talent on their platform
Making creators feel lifted up may be exactly the point. Google has been vocal about protecting and respecting the YouTube creative community, particularly after taking some heat for abruptly shutting down ads on some channels after brand safety issues surfaced.
More than a few in the YouTube ecosystem suspect that the FameBit deal, and the earnings call mention, were about making the influencer world feel loved.
For its part, YouTube emphasized that FameBit is about empowering its creators.
"We feel like when creators are super excited about working with brands, the content gets better," said FameBit's Avril. And he emphasized that FameBit isn't looking to lock up exclusive deals or squeeze other players out.
"We think a rising tide rises all boats."