26 Sep Barter economy is now the ONLY way for brands to survive
The public has been enduring a cost-of-living crisis fuelled by soaring inflation and utility bills, but now businesses are also facing their own ‘cost of operating crisis’. A new report from Sapio Research has found that a staggering 95% of businesses worldwide are in fear of recession, with just over a fifth already being materially affected by the current economic downturn. In fact, marketing budgets are being slashed across the board to cut down on costs.
The influencer sphere has been seriously affected by businesses looking for new ways to save on marketing expenses, with a staggering 30% of influencers seeing a reduction in fees. As brands have begun to cancel campaigns, reduce spend, and broker gifting-only deals, this has given rise to a bartering economy where brands exchange goods or services as opposed to money. In relation to traditional, paid influencer marketing, CEO and co-founder of Room Unlocked Alex Payne argues this from of value exchange is far more cost effective for companies who are losing revenue as a result of surplus stock which is an additional cost of 25% to 32% for the average business – according to industry research. Retailers end up with billions of pounds of excess, unsold inventory with returns creating over a staggering 2 billion kilograms of waste in landfills each year, and more than 15 million metric tons of carbon dioxide – according to CNBC.
Gifting leftover products to influencers is a way for brands to utilise unused stock that would otherwise go to waste. Room Unlocked facilitate this through their innovative platform in which influencers bid to secure promotions with brands. However, with no transactional fee passing from brand to influencer, the content produced by influencers acts as advocacy. Put simply, for love, not money.
Alex Payne, co-founder of Room Unlocked comments:
“Influencers are earning less because brands are being more cautious with their spend, ensuring they connect with the right creators who align with their values and also those of their customers. Influencers who are going to survive and thrive in the current climate are those that have a social cause or genuine passion at the heart of their voice and the content they create, rather than just posting things that they’ve been paid to advertise. Authenticity has quite rightly become king amidst an industry that has been awash with disingenuous content throughout the years and this is becoming increasingly easier to spot.
“Another crucial trend that’s causing influencers to report a reduction in earnings is the simple fact that there are far more of them now. There’s been a wave of people leaving their jobs to chase this career path meaning there’s more competition by way of choice and as such, brands can pay less. Room Unlocked passionately believes that relationships between brands and influencers can be built on love, not money and provide an alternative to traditional, paid routes for content creation. We provide a platform for people to connect and create mutually beneficial and lasting relationships regardless of the current climate.”
