Fyre Festival Fines Could be the Death of Influencer Marketing
Kendall Jenner’s settlement figures will bring audience trust into question
Kendall Jenner’s settlement figures will bring audience trust into question
The fallout from Fyre Festival has far-reaching implications on influencer marketing.
People buy from influencers because they like them, trust them and want to emulate their life and success by purchasing the products they use.
“I can be as beautiful if I use the same skincare.”
“I can be as rich if I have the same suit.”
“I can get as much done if I drink the same energy drink.”
Of course, this fallacy is on the decline. People are waking up the business behind big brand endorsements.
A few days ago Billboard reported that a class-action lawsuit aimed at the influencers who promoted the infamous Fyre Festival had begun to reach some settlements.
Most notably, ‘Keeping up with the Kardashians’ star and model; Kendall Jenner.
According to documents obtained by Billboard, as part of her settlement, Jenner has agreed to pay $90,000 (of her reported $275,000 fee for posting about the festival in 2017) to a court-appointed bankruptcy trustee that is attempting to reclaim money paid to a variety of performers, talent agencies, transportation companies, management firms and vendors involved with the notoriously disastrous concert.
She joins a star-studded list of celebrities that leveraged their Instagram following to sell tickets to this fictitious festival.
However, as the news of the deception breaks, it could spell disastrous repercussions for the business of influencer marketing. Especially for those at the bottom of the ladder.
The potential fallout
In 2019, 59% of Marketers said their budget for influencer marketing had increased — But in 2020 that spend, no thanks to COVID-19, is on the decline.
Although not a secret within the marketing industry, the general public is largely unaware that the products influencers promote aren’t always authentic and altruistic.
It’s not out of the goodness of their own heart, it’s for the good of their own bank balance — and Fyre’s disastrous public downfall might have just exposed that to the mainstream.
As Friedrich Nietzsche once said “I’m not upset that you lied to me, I’m upset that from now on I can’t believe you.”
From now on, in the short-term at least, influencer marketing will have an image problem. A lack of trust between the followers and the influencer themselves.
As settlement figures are released, it reinforces the potential trust issues from potential buyers. Will they be as quick to part with their cash? I don’t think so.
How will companies react?
Risky enough as it is, with limited cash-flow thanks to this Coronavirus-induced recession, companies may be less likely to support influencer marketing initiatives this year, especially with no clear way to project ROI (return on investment).
For now, it’ll be interesting to see, as more details are released, what hit influencers will take to their bottom line.
The ones to recover quickly will be the influencers selling authentic products and services, either created by them (like Dwayne ‘The Rock’ Johnson’s Teremana tequila) or genuinely used daily, (like Joe Rogan’s favourite fitness tracker, Whoop) so the pitch comes from the heart.
I for one, am looking forward to witnessing the creative solutions as influencers adapt to this potential decline.
Will we see more apparel?
Will we see more homemade endorsements? Candles, scents, skincare etc
Will we see more community-driven projects like online concerts, fashion shows and networking events?
As social media usage goes up, there will be a huge redistribution of wealth among up-and-coming influencers, willing to promote things cheaply and widely to a similar audience.
It’s survival of the fittest. Adapt or die.