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This Company Makes Influencers out of Everyday People

Feb 24, 2017,

“It’s very different from the kind of influencer marketing that is represented by the buzzword today…”

Let’s say you work at Best Buy. You recommend laptops, show off TVs and try to explain what’s so great about the newest iPhone.

You probably never thought of yourself as an “influencer”—a buzzword that now encompasses anyone from Kardashians to mommy bloggers to Instagram stars.

But one company is betting that your blue polo shirt offers advertisers the same sort of value as Kim K’s legions of Instagram followers. Salt Lake City-based Experticity has centered its business model around the idea that everyday people like store managers, ski instructors or cycling enthusiasts are all influencers in their own right.

“It’s very different from the kind of influencer marketing that is represented by the buzzword today,” said the company’s chief marketing officer, Kevin Knight. “These are the people who work at like REI and camera shops and skate shops and people come in every day like, ‘Hey I’m looking for a new jacket. What should I get?’”

The company recently launched an exclusive social network restricted to users it deems experts in given area of retail—usually accomplished sales associates, industry professionals or social media-savvy hobbyists.

These users get steep discounts, early access to products and free sales training materials in exchange for their willingness to submit themselves to sales pitches from hundreds of brands. In turn, brands are looking to make enough of an impression that a member might think of their products the next time a customer asks them for a  recommendation. Or perhaps post a photo featuring them to social media.

“It’s very different from the kind of influencer marketing that is represented by the buzzword today.”

It may not sound like the most immediately intuitive business plan, but the company claims to have more than 1 million active users and nearly 750 brands, including North Face, Adidas and Nickelodeon.

These companies each have a bargain-price virtual store within the platform that can only be unlocked by slogging through a pile of their sales materials.

Knife brand Wusthof, for instance, uses the platform to find salespeople in retail stores that sell its cutlery. The company has users watch a presentation on the company’s history and product lines along with a few videos about creative food preparation tips involving its knives. In exchange, they get a 50-percent discount on its products.

“It’s giving them these little nuggets of stories they can tell,” said Wusthof sales coordinator Lauren Soules.

Like many consumer brands, the company also dispatches reps to pitch sales staffers in person, but Soules said Experticity is a much more efficient way of reaching them in bigger numbers.

Wusthof, which has been a client for a year and a half, has pulled its own data on whether or not this tactic actually works. The company examined sales numbers from a retailer Soules declined to name and found that stores employing Experticity users saw more than three times the sales growth of other locations during the brand’s first eight months on the platform — seven percent and two percent respectively.

“That was huge for us,” Soules said. “It was a national retailer with a lot of floors. It was definitely significant.”

Knight came to Experticity from a career working at big social media companies like Pinterest and Facebook. He often dealt with influence marketers in their more conventional form and eventually came to realize that the model was broken. Advertisers placed far too much emphasis on finding spokespeople with massive numbers of followers, he said, often at the expense of credibility and resonance.

“People don’t trust you because they feel like you’re trying to sneak an ad into your feed without being transparent about it,” Knight said. “Or when you are being transparent — ‘Well, it’s just an ad. They paid you to do it.’”

Knight of course has a vested interest in undercutting the appeal of “capital-I” influencers, but his diagnosis of the trend’s problems echoes a strain of criticism emerging among some industry professionals who think this style of reaching people just doesn’t work.

One particularly scathing assessment comes from an anonymous social media exec, who predicted the death of the influencer model in an interview with Digiday.

“Influencers are going to start disappearing. Brands are going to start realizing the amount of followers you have doesn’t mean shit,” the exec told the site. “Just because photos look good and have 200,000 followers means nothing. You can’t rely on content creators all day long.”

In more than 200 comments below the piece, the trade site’s industry-heavy readership debated fervently over whether this view had merit.

There’s also a problem of transparency. In recent months, the Federal Trade Commission has been tightening its rules regarding how influencers must disclose their paid promotions.

Yet reports have shown many still don’t bother to even append a simple “#Ad” to their branded posts (the FTC recently ruled that hashtag wasn’t sufficient disclosure on its own).

Knight sees Experticity’s unpaid community as a way for brands to circumvent these regulatory headaches. Because the company bars its member brands from directly paying any of its users, disclosure is a non-issue.

Furthermore, he thinks tagging ads is enough of a turn-off for advertising-adverse social media users that it defeats the ad’s entire purpose.

As proof, he references a study from Duke behavioral economics professor Dan Ariely, in which two groups of people are told objectively true statements, like, “the Sun is yellow.” For one group, however, the statements were attributed to an advertiser — say, “Procter & Gamble says the sun is yellow.”

No one in the first group ever questioned what they were told, but the introduction of a corporation into the mix led some in the second group to start doubting their own perception of color—“I mean is it really yellow or is it more of an orange?”

The distrustful instinct—coupled with foundation-shaking changes to the media and advertising landscape—is what spawned the influencer marketing trend in the first place, and the space is now populated with dozens of companies zeroed in on every conceivable aspect of the process.

Yet few, if any, are operating in the same strata of ordinary people as Experticity, or offering a service that outfits influencers offline as well as on.

The company that would become Experticity was actually founded more than a decade ago as a simple sales training platform. But it morphed into its current model through a series of mergers and acquisitions, and took the name Experticity in 2012.

Experticity has raised $30 million in venture capital to date, but it won’t reveal its total valuation.

The company’s client list and reach were significantly boosted in a merger last spring with ReadyPulse, a recruitment and management platform for influencers. Knight joined the company from Pinterest last fall as it looked to beef up its own marketing.

In a bid to prove its model actually works, the company recently tapped Wharton business school professor Jonah Berger and research firm Keller Fay to track down customers in the real world who had talked to the company’s users. The study found 82% of customers were “highly likely” to follow their advice, and users had around 22 times as many conversations about products and brands than the average consumer.

The company is hoping that studies like these will eventually reshape how brands think about influencers at a fundamental level. Knight imagines a future in which a significant chunk of the major brand advertising is spread through the voice of their consumers.

“Influencer marketing is, by its very nature, transactional,” Knight said. “I think we’re going to see more brands buying into what we’re trying to champion, which is to find the people who already love your category and your brand.”