Inside the debate among marketers for and against virtual influencers

While the creator economy is growing and expanding, so are the technologies within the landscape.

Enter virtual influencers. That’s right, digital characters if you will, which are in some cases used instead of human influencers as a means to reach new audiences and showcase new levels of innovation that companies have to offer.

While this isn’t a new concept — virtual influencers have been around since the early 2000s — the rise of AI and the growth of the creator economy have sparked a resurgence in marketers’ interest in these digital personas.

Luxury fashion brand Coach, for example, launched its “Find Your Courage” campaign in March, featuring virtual influencer Imma, with real celebrities including American rapper Lil Nas X, American actress Camila Mendes, South Korean rapper Youngji, Japanese model Kōki and Chinese actress Wu Jinyan.

Even social platforms are getting in on the action, with TikTok reportedly developing an AI-powered feature that would generate AI influencers to star in videos that would potentially compete with human creators for ad deals.

But, similar to how AI has been criticized (think arguments like “it’ll steal all the jobs”), virtual influencers have struck a nerve with many in the marketing industry, several of whom have polar opposite views on the matter.

Which is why Digiday has set out the arguments for and against these digital non-humans, so you can make up your own mind.

Arguments for virtual influencers

Low production costs
When you think of a campaign, you think of big budgets: hiring talent, travel, location, accommodation, fashion looks, makeup, the works. There’s a whole production behind the scenes that goes into creating just a few minutes of video for the world to see.

But let’s say you don’t hire talent and you use a virtual influencer instead. Those costs are likely to be a lot cheaper, given that all that’s needed is this digital character on a screen, which can be worked on by a team based anywhere. To compare, Rafael Schwartz, chief revenue officer at influencer marketing agency Territory Influence, said he would (for example) budget at least $50,000 for a full-scale video production with a bigger influencer, while a virtual one could reduce that cost to less than $1,000.

“Another benefit is that virtual influencers can pretty much do anything,” said Lebo Kambule, CEO and founder of virtual tech, media and AI talent management agency The Avatar Company, and who also manages virtual influencer Kimzulu. “If you wanted to create a campaign where there’s explosions, or something visually exciting but potentially dangerous, a virtual influencer could do that without getting hurt. You’re avoiding all those legal and insurance fees and still getting the results you want.”

Schedule flexibility
Virtual influencers aren’t limited to the same 24-hour day as humans. Factor in that a typical human also has a schedule that gets filled up quickly, and frustrations can mount up.

“I’ve managed human influencers for years and one obstacle I always kept bumping into was availability,” said Kambule. “There’s nothing wrong with having a schedule, everyone has one. But with a virtual influencer, they can do anything at any time.”

Lu do Magalu is a tried and tested example of that, working 24 hours a day, seven days a week. Magalu is a virtual influencer that was created in 2003, with the purpose of being the virtual assistant of Brazilian retail company Magazine Luiza to help customers with their purchases. Magalu was well-received and, since her creation, has not only gone on to become a well-known virtual influencer, she’s appeared on reality TV shows including “Dancing with the Stars” and worked with brands such as Adidas, Red Bull and Samsung.

Another example is Brazilian-American Miquela Sousa, better known as Lil Miquela. Created by American AI media company Brud, Lil Miquela has already snagged deals with the likes of luxury fashion brand Prada.

Control over content
No marketer likes giving up control over their content, which is why handing it over to creators or influencers can be a difficult task. With a virtual influencer, marketers can maintain full control over content.

“You have full control as a brand marketer, which you don’t have if you collaborate with a human creator,” said Schwartz. “There are [also] no scandals with virtual influencers because they’re not going to get caught drunk in a party, or behaving stupidly somewhere.”

Influencers are, by default, a representative of the brand(s) they’re working with in any public environment, so, naturally, brands would want them to behave accordinglywhich virtual influencers obviously do.

Arguments against virtual influencers

High costs for the tech
Given there’s a lot of modern technology and coding behind these virtual influencers, the cost of creating one is expensive.

“Whenever I quote for a human influencer versus Kimzulu, Kim’s is a lot higher because there’s so much that’s involved,” said Kambule. And by that, Kambule means his team of three, which includes two women alongside himself, one of whom acts as Kimzulu’s voice and the other her body movements. The trio digitally map and build out the virtual influencer as though she were a real human.

“We even created a DNA chart which broke down all aspects of her personality,” Kambule added — meaning there’s a lot of high-tech work going on behind the scenes.

Lack of authenticity or emotion
For all the scrutiny there is on whether or not human influencers are authentic, what goes in their favor is human experience and emotion.

Consumers buy into influencers based on how much they can relate to their personality and experiences, by feeling connected to them parasocially, said Lea Karam, consulting director at behavioral consultancy Behave. “Virtual influencers are not humans, so they can’t go through human experiences. They can mimic experiences but they’re not as good,” Karam said.

Karam explained that this doesn’t mean there isn’t a place for virtual influencers, but when comparing them to human influencers, they work better when focusing on functional use cases such as how to put on makeup. The tech can aggregate social behaviors because AI self learns. “Virtual influencers are better used for functional purposes rather than emotional, because we as consumers still need to connect with humans, if we’re to build that emotional connection,” Karam added.

AI influencers could drive human influencer rates down
There will naturally be some concern about how virtual influencers will impact the roles of human influencers going forward. The creator economy is still far from regulated when it comes to payments and rates, something the industry is still working out.

As things stand, human influencer rates vary depending on multiple factors, including number of followers, social platforms used and an influencer’s track record. For example, a mid-tier influencer (with 50,000 to 500,000 followers) could earn between $500 and $5,000 per post on Instagram, and between $125 and $1,250 on TikTok, according to Influencer Marketing Hub. Similarly, mega influencers (with more than a million followers) could earn upwards of $1 million per post on Instagram and upwards of $2,500 per post on TikTok — simply because brands buy into their celebrity-like status.

“With human influencers, you pay more, the more followers they have. So as the influencer becomes more successful, the prices of that partnership increase,” said Schwartz. “With virtual influencers, the biggest investment is for the creation of the influencer. But the more content that’s created, the cheaper each piece becomes because you’ll have a wealth of assets the system can build on. So over time, producing more content becomes cheaper and advertisers won’t need to pay inflated prices because they’re only paying for the content, not for the followers.”

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