The Insane (and Lucrative) World of Virtual Influencers 🤖

Discover how virtual influencers are taking over social media, raking in millions for brands, and transforming the future of marketing.

Jun 04, 2024

Meet Lil Miquela: 21 years old, lives in LA, 2.5 million Instagram followers, collaboratxions with BMW, Alexander McQueen, Prada, and a Vogue cover.

... and as real as a flying pig.

Lil Miquela is a virtual influencer, a digital creation designed to look, act, and even "think" like a real person.

Now, before you roll your eyes, let me confess something: I'm not usually a fan of influencers, virtual or otherwise. The curated perfection and endless #sponsoredcontent is manipulative and superficial.

Yet, as a marketer, I find myself strangely drawn to virtual influencers.

Yeah, I know, it sounds crazy.

But as a marketer, I'm captivated by their potential.

This week:

Virtual Influencers Explained
The Impact of Virtual Influencers
Getting Started
The Dark Side
Future Trends
My Final Thoughts
The Rabbit Hole (for those that want to dig deeper)

Let's get started.

Virtual Influencers Explained

I'll admit, I was skeptical at first.

But the more I learned, the more fascinated I became.

Think of them as the lovechild of CGI and a social media team's wildest dreams.

They're close enough to real to be alluring, but far enough to be disturbing.

Yet, virtual influencers aren't new.

A virtual Japanese popstar Kyoko Date has been around since 1996.

But it was Lil Miquela's 2016 debut that launched them into the mainstream. Created by created by Trevor McFedries and Sara DeCou. Lil Miquela's carefully curated persona has blurred the lines between the digital and physical worlds.

They're the dream of every CMO who's ever dealt with a demanding celebrity: virtual influencers always on message, never age and scandal-proof. A dream workforce that never sleeps, never complains, and never asks for a raise

Human influencers are more expensive than virtual influencers. For instance, a human influencer with a million-plus followers might charge a brand more than $250,000 per post. The company that created Lil Miquela, currently the most popular virtual influencer, charges only $9,000 — Source

While cost effective – they're also a bit dystopian, aren’t they?

The Impact of Virtual Influencers

They're not just pretty faces.

They're raking in serious cash too – Lil Miquela reportedly earns over $10k per instagram post.

But the impact is not just money, in June 2018, Miquela was named one of Time’s 25 Most Influential People on the Internet — along side celebrities like Kanye West and Rihanna.

They're reshaping industries:

Fashion: Prada, Balmain, and others are embracing virtual models.
Entertainment: Virtual bands are drawing crowds (remember Gorillaz?)
Social Activism: Some virtual influencers champion causes and raise awareness.

"People don’t connect with images that resemble cartoons. But if avatars begin to look like real people, it’s going to take a lot of power away from modeling agencies. Brands will only need human models for promotional events and walking the runways, and that’s pretty much it.” Kelvin Boon, owner of NYC-based Boon Models — Source

Predictably, critics argue they lack genuine connection, and a poorly designed one can be downright creepy - which is hard to argue against.

Others believe virtual influencers are the future of marketing, tapping into the desires of a digital-native audience. They're unconstrained by the limitations of the physical world, allowing for endless creative possibilities.

Like everything, the truth probably lies somewhere in the middle.

Studies have shown that virtual influencers can offer higher engagement rates compared to their real-world counterparts.

The average engagement rate for virtual influencer campaigns in 2023 was 5.9%. This is 3x higher than the average engagement rate for real influencer campaigns, which was 1.9% — Source

Getting Started with Virtual Influencers

A while back, I started playing around with AI art generators like DALL-E and Midjourney. The ability to conjure up images with just a few words felt like magic.

I even use DALL-E to create the cover images for most of my recent posts.

It's one thing to whip up a cool image, it's another to make it look like a real person.

If you want to learn how to create your own virtual influencer checkout the links in the Rabbit Hole section at the end.

Standing out requires more than technical skill.

You need a deep understanding of your audience, a compelling narrative, savvy social media skills, and a willingness to experiment.

Here’s a few things to consider:

Prerequisite skills: Animation, graphic design, social media marketing, and storytelling are essential for creating a compelling virtual influencer.
Define your goals: What do you want your virtual influencer to achieve? Do you want to increase brand awareness, promote a specific product, or simply entertain your audience?
Develop a persona: Your virtual influencer needs a personality, a backstory, and a set of values that align with your brand.
Choose a platform: Instagram, TikTok, YouTube – where does your target audience hang out?
Utilise the right tools: Midjourney and DALL-E have democratised AI image generation, but achieving truly impactful results may still require partnering with experienced professionals.

If you have budget, there are agencies that specialise in creating and managing virtual influencers— such as Virtual Influencer or Deep Agency.

The Dark Side: Risks and Ethical Considerations

Virtual influencers aren't risk-free.

Backlash: Audiences may view them as inauthentic. Be transparent about their digital nature.
Oversaturation: The market is getting crowded. Standing out will be a challenge.
Ethical Concerns: Misuse can perpetuate harmful stereotypes and impact mental health.

It's crucial to tread carefully, and please without sounding boring — prioritise ethical creation and marketing practices.

As a marketer, I'm particularly concerned about the impact of virtual influencers on young audiences. The potential for them to show unrealistic beauty standards and body image issues is a real concern.

Future Trends

As technology advances, expect:

Hyper-Personalised Experiences: Imagine virtual influencers tailoring product recommendations based on your individual style, preferences, and purchase history.
Interactive Storytelling: Brands could use virtual influencers to create immersive, interactive stories that engage customers on a deeper level.
Virtual Events & Concerts: Forget crowded venues and expensive tickets. Virtual influencers could host exclusive events accessible to anyone, anywhere - it’s already happening.
Social Change Agents: Virtual influencers could advocate for causes, raise awareness for social issues, and even run for office - can they do worse than existing officials?
The New Brand Mascots: Forget Tony the Tiger. The next generation of brand mascots could be fully-fledged virtual influencers with their own personalities and social media fans.

These digital beings could become our virtual friends, therapists, or even romantic partners. Or they could lead to a dystopian future where we're all glued to our screens, interacting with artificial beings instead of real people.

Only time will tell what the future holds.

My Final Thoughts

Are virtual influencers a powerful tool for brands? Absolutely.

Are they a bit unsettling? You bet.

As a marketer, I'm excited about the possibilities. But as a human, I'm concerned about the potential negative impact, especially on young people.

Their unregulated rise, particularly on platforms like Instagram, poses a significant threat.

These manufactured lifestyles can be as addictive and damaging as cigarettes, warping young people's perceptions of reality and self-worth.

I believe we need regulation to protect children from this digital wild west.

So, yeah, virtual influencers are fascinating.

But they're also a bit terrifying.

The Rabbit Hole - For Those Who Want to go Deeper

Check out these hand-picked resources:

How To Create Your Own Virtual Influencer

Must-Follow Virtual Influencers:

Lil Miquela: The OG virtual influencer.
CB of Casas Bahia: Retailer mascot who has also partnered up with Samsung and other smaller companies.
Lu do Magalu: Virtual assistant, tech guru, activist, model.
KYRA: India's first Virtual-Influencer
Thalasya: First Indonesian digital Human
Shudu Gram: A digital supermodel redefining beauty standards.
Blawko: Lil Miquela's enigmatic virtual best friend and collaborator.
Imma Gram: A virtual influencer from Japan blurring the lines of reality.
Bermuda: A virtual influencer known for her edgy style.

Good Reads:

Virtual influencers are earning as much as their human counterparts: From amassing followers to securing brand deals, the social media presence of these digital personas is expanding, and it appears that they are also adept at maintaining a human connection.
The Rise of Virtual Influencers: A New Era of Marketing: A Harvard Business Review in-depth article exploring the impact of virtual influencers on the marketing landscape.
TikTok may add AI avatars that can make ads: The new feature will let advertisers and TikTok Shop sellers generate scripts for a virtual influencer to read.
Virtual Influencer Collaborations: Talking Brand Partnerships to the Next Level.
The Ethical And Legal Considerations Of Influencer Marketing And AI Photo-Editing Tools: Ethical issues arise when influencers promote unrealistic beauty standards, affecting mental health. Legally, failing to disclose photo edits can result in accusations of false advertising.