How ready are brands to tap virtual influencers

Last year, China came up a new action plan, called the Beijing Action Plan for Promoting the Innovation and Development of the Digital Human Industry. The first-of-its-kind initiative is aimed at regulating digital humans. It has become necessary in a country where virtual influencers have become a force to reckon with. We haven’t reached that far yet. However, we may soon have our own Ayayi or Liu Yixis!

Virtual influencers can do anything that human influencers can do, but with more control and engagement, said Christopher Travers, the founder of VirtualHumans.org.

Virtual avatars are gaining prominence in various parts of the world, and it is possible that we may see a similar trend in India in the days ahead. However, it is important to note that virtual avatars may not necessarily replace human influencers, as human connection and authenticity are still valued by audiences, says Ayushi Arora Gulyani, Founder & CEO, Media Corridors.

Virtual avatars can be used to start a ‘new/ ideal reality’ or a personality from scratch, says Vinay Pillai, Head of Clout and Head of Strategy, Pocket Aces. “It’s a great way for highly creative people to express themselves or try out content creation, without feeling unsafe or worrying about troll comments on social media. When we look at it from a brand/ industry perspective, take an example of the fashion industry, here, virtual avatars can be used to model products that don’t yet exist,” he adds.

Rubeena Singh, Country Manager, India and MENA, AnyMind Group, feels that virtual avatars will likely become prominent in India over the coming years. “This is partly thanks to the vast technological advancement and the increasing demand for more immersive experiences. Virtual avatars can be used for various purposes, from entertainment and communication to education and business. For instance, virtual avatars will be used to create more realistic simulations of environments and situations, providing a more engaging and interactive experience. Virtual avatars can also be used for communication, providing a more lifelike and natural way for people to communicate. Additionally, virtual avatars can be used for education, allowing students to explore the world and learn new things in a virtual setting. Finally, virtual avatars can also be used for business, creating powerful and effective marketing campaigns that reach a wider audience,” she adds.

Virtual avatars have been gaining prominence in different parts of the world, including India, says Mukesh Vij, Founder, Hashtag Orange. As technology advances and people become more familiar with virtual experiences, it’s likely that virtual avatars will continue to grow in popularity in India.

He lists out the reasons why virtual avatars may gain prominence in India in the days ahead:

1. Personalization: Virtual avatars offer a high degree of personalization, which can be appealing to consumers in India. With a virtual avatar, users can create a unique identity that reflects their personality, preferences, and values.
2. Accessibility: Virtual avatars can be accessed from anywhere, at any time, which makes them appealing to consumers who are always on the go.
3. Cost-effective: Compared to traditional marketing channels, creating and using virtual avatars can be cost-effective for brands in India.
4. Engagement: Virtual avatars can offer a unique and immersive experience for consumers, which can lead to increased engagement and loyalty to the brand.

“While it’s difficult to predict the future with certainty, it's likely that we will see virtual avatars gaining prominence in India in the days ahead,” he said.

Although it is difficult to predict the future, virtual avatars have already gained acceptance in other domains, most notably the gaming industry and other virtual reality experiences, says Sociowash Co-founder Pranav Agarwal.

According to him, with advancements in AI and Augmented Reality technologies in India, virtual avatars may become more popular.

“We will undoubtedly see more virtual avatars; India already has its first meta influencer, @kyraonig, and there will be more to come. However, this is also dependent on factors such as available infrastructure, technology, and implementation costs. Another important factor is the acceptance of new technology by consumers and businesses. Virtual avatars could help businesses that traditionally rely on human interaction to build relationships with their customers in a fun new way. However, one must not forget that AI cannot replace human interaction,” he adds.

Preety Singh, Co-Founder and Managing Director, Boomlet Media, says that it is possible that we may see virtual avatars gaining prominence in India in the future. “With advancements in technology, virtual avatars have become increasingly realistic and interactive, which could make them a valuable tool for businesses looking to engage with customers in new ways. In particular, virtual avatars could be useful for industries such as gaming, entertainment, and e-commerce, where immersive and engaging experiences are highly valued. However, the adoption of virtual avatars will depend on a number of factors, such as technological infrastructure, consumer preferences, and regulatory considerations,” she adds.

The future

What is the future of influencer marketing in India? Will it outpace traditional marketing means? 

Vinay Pillai feels that Influencer marketing as compared to any traditional marketing is more focused, trustworthy, and audience-driven. According to him, with more people putting up ad-blockers, traditional marketing means are becoming difficult for brands to trust and drive sales from their target audiences.

“Nowadays, people value and trust the opinions of creators on their social networks. Brands can use this trust between a creator and its followers to drive their sales by penetrating into the right target audience through relevant creators. In recent years we’ve seen creators building a very loyal community on their channels, which will keep growing with time and consistent efforts by the creator. Unlike traditional means, through creator marketing brands have more space to experiment, adapt and improve their products based on customer feedback. Busting myths around their products is way easier if customers hear it from a trustworthy resource – or a creator they love. Also, considering brands can choose to market with Micro/ mid-size or macro creators, they have the freedom to design a budget accordingly, whereas, budgets are not so flexibly designed for traditional means, brands need deep pockets for this.  Therefore, Influencer marketing is definitely set to outpace traditional marketing means,” he says.

Ayushi Arora Gulyani feels that influencer marketing is expected to continue growing in India, outpacing traditional marketing means. With the increasing penetration of social media and the growing number of internet users, influencer marketing provides a cost-effective and targeted way for brands to reach their audience.

Influencer marketing in India is undoubtedly on an exponential rise, says Rubeena Singh. According to her, more and more brands are realizing influencer marketing as an effective tool for brands to reach out to their target audience. Moreover, she adds, as digital marketing has a higher share of other channels, brands are shifting their focus to influencer marketing. This, according to her, is further reinforced by the massive surge of local language and video consumption in India.

“Besides, influencer marketing itself is evolving and transitioning into live commerce and fulfilling objectives from brand awareness to sales. Consequently, it is not difficult to predict that growth in influencer marketing will soon outpace traditional marketing means,” she adds.

Pranav Agarwal feels that traditional marketing is declining; more brands are focusing their spends on digital channels due to the higher ROI; however, print and television will not become insignificant instead they will become P2-P3 for brands and media planners alike.

Concurring with the rest, Agarwal says that influencer marketing is growing rapidly, and the future looks equally promising. “The recent report 2022 estimates that the influencer marketing industry is currently worth Rs 1,275 crore and will grow at a CAGR of 25% over the next five years, with a billion-dollar market in India alone. Influencers are becoming increasingly valuable to brands because they help build awareness, connect, and trustworthiness. With new guidelines and regulations on the way, influencer marketing will become more legitimate and will grow in a more organised manner. Long-term relationships between brands and influencers may also emerge.”

Influencer marketing is expected to continue to grow in India, as more and more people are accessing the internet and social media platforms, points out Boomlet Media Co-founder and Managing Director Preety Singh. “Influencer marketing has become an integral part of marketing strategies for many brands. Influencer marketing is likely to become even more prevalent in India in the coming years, as traditional marketing means continue to face challenges such as ad-blockers and declining engagement rates. However, traditional marketing methods are still likely to remain relevant and necessary for many brands, especially those targeting older audiences or those in more traditional industries,” she adds.

Mukesh Vij is of the opinion that influencer marketing in India is rapidly growing, and the future looks promising for this marketing channel. With the increasing number of internet users and social media adoption in the country, influencer marketing is becoming an essential part of brands' marketing strategies. He lists out the reasons:

1. Growing audience: India has a massive population, and the number of internet users is increasing every year. Social media adoption is also on the rise, which means brands have an opportunity to reach a vast audience through influencer marketing.
2. High engagement rates: Influencers in India have a high level of engagement with their followers, which means that their content is likely to be seen and interacted with by a significant number of people.
3. Niche expertise: India has a diverse population with different cultures, languages, and interests. Influencers with a specific niche expertise can help brands reach targeted audiences with relevant content.
4. Authenticity and trust: Influencers in India are often perceived as authentic and trustworthy, which helps to build trust and credibility with their audience.

According to Mukesh, while it is difficult to predict the future of marketing channels accurately, it is likely that influencer marketing will continue to grow in India and become an essential part of brands' marketing mix. “While traditional marketing means may still be relevant in some cases, influencer marketing has proven to be a powerful tool for reaching and engaging with audiences in a more personalized and authentic way. Therefore, it's possible that influencer marketing may eventually outpace traditional marketing means in India, especially as more brands recognize the value and potential of this marketing channel,” he points out.

Defining trends

Influencer marketing spends are expected to increase in the coming years, but brands won’t look at just one off partnerships, says Vinay Pillai. “It will become more of a long term partnership between brands and certain creators where the creators will be the voice of the brand. Today creators are doing campaigns of various brands from varied categories as a one of reel/ video deal, in the coming years we’ll see brands wanting creators to stick to long term associations where they would want the creator to be the voice of the brand and spread the brand message consistently through various channels,” he adds.

The overall influencer marketing industry is constantly evolving, says Preety Singh. “Some of the trends that will shape the entire segment include increase in demand for short format video content, emphasis on micro-influencers, and long term partnerships between brands and influencers. Emphasis on authenticity of content as consumers are becoming more discerning about the authenticity of influencers, and brands are responding by working with influencers who are more transparent and honest about their sponsorships,” she says.

According to Ayushi Arora Gulyani, some defining trends in the field of influencer marketing include the rise of video content, the increasing use of ephemeral content, the growing popularity of short-form video platforms such as TikTok and Instagram Reels, and the increasing focus on authenticity and transparency.

“India’s creator economy is rapidly growing and evolving, driven by the increasing popularity of social media platforms and the growing number of internet users. The Indian creator ecosystem has some unique traits compared to the west, including a larger focus on regional content, a higher penetration of mobile devices, and a growing number of micro-influencers. However, challenges such as monetization and IP protection still need to be addressed in order to fully harness the potential of India's creator economy,” she concludes.

Influencers play an active role in shaping the social media landscape, and their work is increasingly recognized by brands, says Rubeena Singh. As we head into a new year, influencers will continue to gain traction with their communities. Trends brands should consider include:

• Influencers Will Become Key to Many Affiliate Programs
• Micro and Nano Influencers Will Continue to Get More Love
• A Greater Emphasis on Diversity and Representation in Influencer Marketing
• Brands Will Look for Ongoing Partnerships Instead of One-Off Projects
• Influencers Will Become More Specialized
• Performance-based Deals Will Increase in Popularity

With the growing pace of influencer marketing space, brands are looking forward to working with more micro and nano influencers because they are familiar with their communities and have established a level of trust, which aids in obtaining a positive ROI, says Pranav Agarwal. “Brands want to remain socially and culturally relevant, and they want to increase representation through influencer marketing. Marketers are now looking for creators/influencers who have a large following across multiple social media platforms, and whether or not their audience interacts with them across accounts. Another growing trend is livestream shopping, in which viewers can purchase products while viewing an influencer's live stream.”

Mukesh Vij lists out the most significant trends as:

1. Micro-influencers: Micro-influencers are individuals with a smaller social media following (typically between 1,000 and 100,000) who have a highly engaged and loyal audience. Brands are increasingly turning to micro-influencers as they offer a more cost-effective and authentic way to reach a specific target audience.
2. Video content: Video content is becoming increasingly popular in influencer marketing, particularly short-form video content on platforms such as TikTok and Instagram Reels. Brands are recognizing the potential of video content in driving engagement and conversions and are partnering with influencers who can create compelling video content.
3. Long-term partnerships: Brands are moving towards long-term partnerships with influencers. This allows for a more authentic relationship to develop between the brand and influencer, resulting in more genuine content and a higher level of trust with the audience.
4. Authenticity and transparency: Consumers are increasingly demanding authenticity and transparency. Brands that partner with influencers who genuinely believe in the product or service they are promoting are more likely to gain the trust and loyalty of their audience.
5. Niche influencers: Brands are recognizing the value of partnering with niche influencers who have a smaller, but highly engaged audience within a specific interest area or community. These influencers are perceived as experts in their field and can offer a more targeted and relevant way for brands to reach a specific audience.

These trends, he adds, are shaping the future of influencer marketing. Brands that are able to adapt to these trends and partner with the right influencers are more likely to see success in their influencer marketing campaigns.

The Indian creator economy

How big and evolved is India’s creator economy? What are the unique traits of the Indian creator ecosystem when compared to the west?

Mukesh Vij feels that India’s creator economy has grown significantly in recent years and has become a major part of the country’s digital landscape.

“According to a report by KPMG, India’s creator economy is expected to grow to $1 billion by 2025, with more than 10 million creators active in the country. One unique trait of the Indian creator ecosystem is the diversity of content creators and their audiences. India has a vast population with diverse languages, cultures, and interests, which has led to the emergence of a wide variety of content creators across different niches. Another unique trait of the Indian creator ecosystem is the focus on regional languages. While English is still a dominant language in the country, there has been a surge in the popularity of content created in regional languages. This has opened up new opportunities for creators who can produce content in languages other than English and has led to the emergence of regional content platforms,” he explains.

According to him, India’s creator economy has become a dynamic and rapidly evolving industry with unique traits that set it apart from the West. As the ecosystem continues to grow and evolve, it is likely to create new opportunities for creators and brands alike.