AI Prompts
October 6, 2023

AI & Virtual Influencers: Navigating Brand Strategy Amid Hollywood Strikes

In the ever-evolving landscape of the entertainment industry, a fascinating transformation is taking place. As the Hollywood actors' strike casts a shadow over traditional film and television production, with an estimated hit of $5 billion dollars to the economy, a new and unconventional phenomenon is rising to prominence - virtual influencer marketing. 

This strike involves actors concerned about their likeness being used without permission and a potential loss of compensation if Artificial Intelligence (AI) clones are used. The entry of virtual influencers could prove to be another sticking point, something they might not have any control over.

The virtual influencer market is currently valued at $4.6 billion and is expected to increase by 26% by 2025. With 75% of Gen Z following virtual influencers, various brands like Nike, Samsung, Calvin Klein, and Balmain have already started brand partnerships with virtual influencers.

Pie chart distribution showing virtual influencers' social media platforms being followed by consumers

The Emergence of Virtual Influencers

Virtual influencers, or digital avatars created through the magic of AI, have rapidly captured the imagination of social media users and marketers alike. Three main types of virtual influencers exist – animated humans, non-humans, and life-like CGI humans.

These computer-generated personas have gained millions of followers on platforms such as Instagram and TikTok, challenging the conventions of celebrity endorsements with a seamless transition from social media stardom to becoming active participants in advertising campaigns, films, and even music videos - a testament to the use of AI in entertainment. 

Since Lil Miquela - a popular influencer - burst into the online influencer market in 2016, she has amassed nearly 3 million Instagram followers and bagged big brand deals, leading to a net worth of over $10 million. Created by American AI company, Brud, Miquela is estimated to charge over $10,000 per post.

The “19-year-old influencer” partnered with Samsung to be a part of the #teamgalaxy campaign in 2019, in a deal that netted her millions. Blurring the lines between virtual and reality, Miquela has also participated in an ad for Calvin Klein with real supermodel Bella Hadid. 

A screenshot of a social media post description automatically generated
AI Influencer lilmiquela’s instagram page

What’s in it for brands who choose to work with Virtual Influencers?

This isn’t a recent phenomenon as “virtual idols” have existed for a while, with Kyoto Date debuting in 1996. However, the latest developments in AI have made these digital avatars even more realistic, thereby increasing the parasocial relationship with their audience.

AI-powered virtual influencers can also produce content 24/7, thereby challenging the limits of a real influencer and the influencer ROI. This can have a direct impact on engagement levels when used strategically based on social media platform algorithms. 

Pros for a brand:

  • Provides access to new audiences and allows for unique audience engagement strategies
  • Allow brands more flexibility and control over their partnership
  • Digital avatars in advertising allow for quick reshoots and changes 
  • Virtual influencers don’t age, allowing brands to carry on collaborations and campaigns for a longer period
  • Travel and physical barriers won’t be a concern
  • Adding a touch of novelty that can make a campaign memorable

Cons for a brand:

  • Influencers may promote unrealistic standards 
  • A lack of authenticity can drive customers away
  • Virtual influencers can’t physically interact with products, which increases the challenges
  • This new territory for brands can place them at risk of controversy 
  • Potential association with unethical campaigns based on deep fakes
  • Underage virtual influencers raise moral quandaries 
  • Antagonize real actors (An impact of Hollywood strike) 

So what should Brands do?

As virtual influencer marketing rises in prominence, brands can navigate this dynamic landscape by adopting the following strategies:

  1. Authenticity and Transparency - Maintain transparency about the virtual nature of influencers to build trust with consumers.
  2. Strategic Collaborations - Partner with virtual influencers whose personas align with your brand values and target audience.
  3. Ethical implications of AI – Keep up with evolving regulations and ethical standards in the virtual influencer marketing space.
  4. Innovative Campaigns - Develop creative campaigns that leverage the unique capabilities of virtual influencers, such as 24/7 availability and consistent messaging.
  5. Audience Insights – Use data analytics to understand the preferences and behaviors of virtual influencer followers, enabling personalized marketing strategies.

Some of the top virtual influencers today:

  • Qai Qai - A virtual personality with over 4.5 million followers on TikTok
  • Noonoouri: A vegan activist and model who has collaborated with brands like Versace, Balenciaga, and Off-White
  • Lechat - A virtual influencer who posts dance videos to over 3.2 million followers
  • Lil Miquela - One of Time Magazine’s Most Influential People on the Internet in 2018 
  • Code Miko: A gaming influencer with a loyal online following
  • Kizuna AI - 3 million followers on TikTok for this Japanese virtual influencer

The meteoric rise of virtual influencers has raised many questions about unrealistic beauty standards, highly engineered content, cultural appropriation, the potential to alienate audiences and even the future of virtual influencers. Furthermore, the Hollywood Actor’s strike complicates how brands navigate this evolving landscape. 

What do you think?

Do you believe brands should stay away from virtual influencers? Write to us.

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