The Big Promise of Virtual Influencers
Proponents claim virtual influencers solve key issues for brands:
- Scalability - They can join unlimited campaigns and be in multiple places at once.
- Cost Savings - No fees or travel costs like human influencers. Potentially cheaper than high-end influencers.
- Brand Safety - Backstories and content can be carefully controlled for on-brand messaging.
The Murky Business Models and Money Behind Virtual Influencers
Various startups have emerged to create virtual influencers, like Brud and TheSoul Publishing. Most keep their business models opaque:
- Raising venture capital to fund growth, but little transparency into costs and revenues.
- Monetization unclear - sponsored posts? Licensing for media projects?
- No public data on what brands pay for campaigns. Likely still high fees.
Limited Data and ROI Benchmarks
Anecdotes abound of successful virtual influencer campaigns, like Lil Miquela's Prada partnership. But hard data is lacking:
- No benchmarks on campaign performance versus human influencers. Engagement rates? Sales lift?
- Difficult to accurately track and attribute conversion value.
- Success likely limited to awareness and engagement so far.
Risks and Downsides for Brand Partnerships
While promising, virtual influencers come with uncertainties:
- Tech glitches could happen during campaigns, especially using new formats like AR.
- Still figuring out ideal campaign types and formats to leverage their strengths.
- Avoiding content staleness and maintaining momentum as novelty wears off.
So are virtual influencers worth it for brands? They offer creative opportunities, but more case studies are needed to quantify their true ROI versus human collaborations. Brands must scrutinize costs, likely performance, and potential risks before jumping in. While the hype is big, it may be smart to start small until more data emerges. Either way, the virtual influencer era has arrived.
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