(This post is cross-posted on the SoftwareInsider blog.)
Eight Major Influencer Types Exist Today
Analyst relations, public relations, influencer relations and other interested parties have witnessed the rapidly evolving and emerging buy-side and market influencer models. In the past, eight influencer types followed five distinct traits (see Figure 1):
- Fame. Awareness, notoriety, perceived market status.
- Fortune. Billing rates, wealth, earnings.
- Market impact. Buy-side decisions making, sell-side product direction.
- Personal impact. Individual decisions, behaviour changes.
- Initial business model. Revenue drivers, monetization strategy.
Figure 1. Five Traits Of The Major Influencer Types
Influencer Types Converge As Firms Seek Survival And Maintain Relevance
However, changing influencer economics over the past 5 years have forced convergence among the eight major influencer types (see Figure 2.). In fact, the traits among influencer types have blurred with increasing adoption of social media and rapid decimation of the ad-supported media model. Peer to peer facilitators, user generated content, and bloggers have accelerated the destruction of legacy models. As a result, influencer types have adopted and invaded adjacent business models in order to grow revenue. Subequently, shifts in market forces have inspired others to create new business models. For example:
- Events producers have fallen neatly into the hands of media moguls. Event producers own the socialization of influence via trade shows, events, and summits. Yet, nearly all the event production companies have been acquired by struggling media conglomerates. Declines in ad revenues created natural synergies with a readership base seeking to attain knowledge and socialize their experiences. More importantly, declining advertising revenues were bolstered via field marketing spend in event sponsorships. A few firms such as George P. Johnson and Viad Corp still dominate niche markets. Unfortunately, most have aligned with media properties. Media moguls and other influencer types will seek to acquire the remaining stand alone event producers in order to bolster profits.
- Management consultants have aligned with academics and entered media through blogs. Management consultants deliver expertise and front line influence with buyers. Hoping to establish criteria through partnerships with academia, major firms sponsor joint studies to raise mindshare among clients and prospects. In addition, management consultants have slowly entered the media fray. McKinsey & Co. is a classic example as an early mover through its McKinsey Quarterly. Others have since followed using blogs as the key driver of thought leadership via social media. Management consultants will push into the industry analyst type for the billing rates despite lack of perceived objectivity and credibility.
- Industry analysts have sought greater influence through peer to peer facilitation and higher profits via consulting. Research firms bring objectivity and high levels of credibility to buyers and the market. Gartner Group, Forrester, IDC, Ovum, and Yankee have traditionally built events and consulting businesses to complement their syndicated research models. Under fire from peer to peer exchange forums such as Corporate Executive Board, firms have countered with similar offerings. Additionally, industry analyst firms have grown dependent on consulting revenues to bolster profitability. Entry of new firms such as RedMonk and Altimeter Group who adopt open research models and trade highly scalable syndicated research profits for consulting revenue streams threaten legacy syndicated research models. Legacy research firms can expect to remain under attack from media and peer to peer facilitators such as Wikibon and Gerson Lehrman Group who can deliver more cost effective analysis.
- Media moguls have adopted the most adjacent revenue streams. Media moguls deliver mass influence and credibility. Media players were hit first in the business model change. GigaOm’s events business and introduction of their research offering GigaOm Pro show an agile response to balancing media mogul, event producer, and industry analyst competencies. Mashable and Tech Crunch all hae complimentary and profitable events businesses. Meanwhile, United Business Media/ TechWeb has long monetized its media empire through an events empire. However, one of its titles, Information Week, launched its Information Week analytics product two years ago – effectively entering the industry analyst business through market research. IW analytics now competes with IDC and Gartner for primary research subscriptions. Media moguls also seek authorship to drive additional individual revenue and influence. Media moguls will enter the most adjacencies to support a dying advertising model.
- Peer to peer facilitators have blended events with industry analysis. Peer to peer facilitators influence buying using crowdsourcing of experts to buyers. Corporate Executive Board showed how a stone soup model for sharing peer to peer insights could turn into a $410M business. Expert network leader Gerson Lehrman Group amassed an insights business serving the financial services and investment industry. Software Insider estimates annual revenues north of $500M. Peer to peer facilitators continue their attack on industry analysts through peer insights and will gain market acceptance and traction through larger networks.
- Academics have not effectively extended influence other than authorship. Academics achieve respect but lack mass influence with buyers. Most academics remain focused on their core mission of research and teaching. Because higher education institutions allow their academics to keep most book revenues and speaking fees a growing number enter authorship to grow their influence. Academics must extend to new influencer types in order to regain relevance and impact.
- Training gurus have remained isolated to author led business models. Training gurus deliver personal value but do not usually impact upstream buying decisions. Many authors such as Steven Covey and Michael Hammer have built training academies to put their books into action. Training gurus usually focus on volume based business models. Expect training gurus to enter a similar fate of event producers and become absorbed by other influencer types.
- Authors and producers have entered training adjacencies and aligned with media moguls. Authors create influence through their thought leadership in books. Producers create thought leadership in other media forms. Collectively known here as Authors, they will continue to expand their influence by participating in media and building related training programs for scalable revenue. All influencer types will continue to seek adjacencies in the author influencer type.
Figure 2. Convergence In Business Models Accelerate Among The Eight Major Influencer Types
The Bottom Line: Influencers Will Adopt Multiple Influencer Types to Earn Market Maker Status
Market makers create tremendous influence in the market. Today’s savvy influencers already adapt multiple influencer types to gain market maker status. A true market maker will master at least four influencer types. For example, some industry analysts earn market maker status by authoring books, writing for media publications, facilitating peer to peer sessions, delivering training, advising clients via consulting, keynoting events, and partnering with academia. Management consultants who author books, gain a column on a blog such as Forbes, and run focused events achieve market maker status. Blogger media moguls who write industry analyst reports, lead training sessions, and speak at events gain market maker status. Expect legacy models to be blown up as new firms of market makers emerge and continue the disinter-mediation of the influencer market.
Are we missing any influencer categories? How will firms divide responsibilities for market makers who participate in multiple influencer types? As this progresses, how will influencer relations change to meet these new hybrid firms of market makers? Will AR or PR take the lead? Will the classical models still matter? Share your thoughts in the comments or send a private post to rwang0 at gmail dot com or r at softwaresinsider dot org and we’ll keep your anonymity.
Reprints can be purchased through the Software Insider or Constellation Research brand. To request official reprints in PDF format, please contact firstname.lastname@example.org.
Although we work closely with many mega software vendors, we want you to trust us. For the full disclosure policy see www.ConstellationRG.com
Copyright © 2011 R Wang and Insider Associates, LLC. All rights reserved.