Virtual influencer hype: How long before the trend hits the Malaysian market?

With a digital savvy population and over 4.6 million social network users (as of 2018) in Malaysia, it comes as no surprise that Malaysia is no stranger to influencer marketing.

Instagram, which is one of the most preferred social media platforms among brands and influencers in Malaysia has about 11 million users, a 70% increase since 2016 penetration social media. And what has slowly been on the rise on platforms such as Instagram is the use of virtual influencers. These influencers are working with brands from a myriad of industries from F&B to fasion. From Lil Miquela, Shudu, and Margot to Zhi, and Noonoouri, these virtual influencers have built a following for themselves among the Gen Zs, also known as the digital natives.

While a quick check by A+M showed that there hasn't been a virtual influencer campaign which has launched in the Malaysia market at the time of writing, industry players A+M spoke to said it won't be long before the trend hits the market. Speaking candidly, they said it is the novelty, mystery, and the unclear boundaries between the real and virtual world that draws Gen Zs to virtual influencers.

Amit Sutha, CEO UM Studios and Ensemble Worldwide, told A+M  that the Malaysia market is brimming with talent and can aid from technical skills of 3D development to story telling. "The sheer amount of talent allows for such platforms to have a lot of potential," he said. Sutha added that Malaysia is one of the unique countries that is divided when it comes to influencer pyramids based on demographics. As such, virtual influencers can prove to be beneficial in making influencer marketing much bigger in the country.

Supporting his statements, a 2019 survey by HypeAuditor, showed that virtual influencers have almost three times more engagement rate than real influencers. The AI-powered platform has worked with brands and agencies such as Dior, Unilever, LVMH, GroupM, Ogilvy, Reprise Digital, and Havas Media. It added that these virtual influencers have an engagement rate of 2.89%,  while real influencers in the same range only have an engagement rate of 0.7%. Moreover, the audience of virtual influencers are mainly between the ages of 18 to 24 years old.

Sutha added that the blur of lines between the real and virtual world has always been an interesting topic especially for those generations born and raised in the Internet age. These younger audiences have grown up with heroes that have come to life through 3D renders, be it in gaming or films.

"This makes the idea and techniques behind virtual influencers very familiar to them. Add this to the power of social media storytelling and we can create very relatable stories that almost makes fantasy a reality," Sutha said. He explained that the ability to create content is one of the reasons for the rise in popularity of virtual influencers. As the process of creating these virtual influenceres streamline, content can be made to accommodate the rapid pace of social and be integrated with all types of mediums such as traditional and digital.

"Not only does the streamlining allow virtual influencers to adapt, the pace of content creation also allows them to keep up with real time data, which means they can fit into any type of programmatic or dynamic content process," Sutha said.

A blank canvas 

The one advantage virtual influencers offer companies over actual influencers is the opportunity to instill a creator's or a brand's personalities. Essentially, a blank canvas. "In essence, it is akin to a brand raising a child to embody its own values. That’s the kind of opportunity and playground we get to explore with an idea like this," Sutha said.

Through those flexibilities, virtual influencers thus become a very powerful tool that can carry out an emotional story that is both data-driven and platform agnostic.

Agreeing with him is Ruhana DaSilva, managing director, Lemonade who said the misalignment between the brand's objectives and the creator's values will become less of a concern with virtual influencers, as technology allows for a crafted relatability. Virtual influencers can echo sentiments, values, aspirations and more to that of a specific target audience. They can be strategically positioned to communicate in more complex narratives designed to strike a chord with their audiences, DaSilva said.

The novelty, mystery, scarcity, and newness of virtual influencers are also key elements in their current popularity, according to her.

Is a humanised experience and authenticity possible?

But in today's experience economy, marketers and brands cannot ignore the fact that real humanised experiences triumph over overly designed narratives, DaSilva said. "It is the very baseline that has allowed influencer marketing to gain such momentum and evolve to becoming a space where the brand and the creators can come together and co-own the direction for a brand initiative. This dynamic has allowed for marketers to be in direct connection to the consumer," she explained.

For virtual influencers to tackle this, they will require a point of view on the backend from a human or humans, in a manner that consumers can connect with, she said. "An advantage with the technology is the customised experience. To better understand consumers and personalise interactions with them, but it begs the question of scalability and quality control over time," DaSilva added.

While brands have the ability to make their influencers more reliable, virtual influencers at the end of the day do not necessarily experience the product or experience that brands are selling.

For example, going on a holiday or spa, or trying out a new pair of shoes. In such cases, DaSilva said this takes away "massively" from the authenticity and ethics of influencer marketing. "While brands can work closely with human influencers on setting guidelines for the objectives of a campaign, there is still a human experiencing the brand and products, there is a real opinion to be considered and discussed," she said.

With virtual influencers, DaSilva explained that there is often a team of specialised professionals working to craft this narrative.

Influencer marketing should be an intimate relationship between the brand, product and the creator, and not a superimposed view on what that product may be like.

Meanwhile, Evangeline Leong, CEO, Kobe Global Technologies said more thought and effort would need to be put into content creation, since virtual influencers might not be able to experience the product. According to her, influencer marketing can be done in a flexible way in which new and fresh content can be created without losing the authenticity and ethics of it. For example, brands can programme their virtual influencers to unveil a new challenge on TikTok or even unveil various product teasers.

Nonetheless, UM's and Ensemble's Sutha said virtual influencers should still be "treated as a tool" that can tell a story because they "bridge into the real world and are very capable of pointing towards real experiences as well".

"Experience and demonstration is still very much the realm of human influencers. However, a virtual influencer would help embody the brand more," he said.

For example, a virtual influencer posing with late basketball legend Kobe Bryant after his death does carry real emotions as a content piece. "Whilst the virtual influencer may not experience sadness of loss, being able to create a dedication carries a different kind of emotion and experience. Virtual influencers can also feature real people to create testimonials," Sutha added.

Will the virtual influencer trend take off in Southeast Asia?

Currently in Indonesia, virtual influencers are being used by local brands such as Thalasya with Chocolatos, and Cahaya with Kaum Restaurant.

Yhanuar I. Purbokusumo, director of strategic services, Wunderman Thompson Indonesia, said younger consumers do not necessarily pay attention on background stories that are usually important for human influencers. As long as they are cool and hip, the influencers will have a following.

"Virtual influencers such as Miquela Sousa or Imma relate to youngsters because they build based on their interest. While the influencers are not real, they look like humans which causes consumers to discuss about them. That is kind of storytelling that youngsters are relate now," Purbokusumo said. He added that most brands use virtual influencers to showcase their cool side, and as such, regardless of the product's category, these influencers can succeed in promoting them as long as the product is cool. According to Purbokusumo, the reception to these virtual influencers in the market has been good. For virtual influencers to succeed, the CGI quality is very important.

"Popular virtual influencers with hundred thousands of followers and high engagements such as Miquela Sousa, Imma, or Bermuda are visually outstanding. They look so real, and consumers adore that quality of realness," he said. On the other hand, Indonesian virtual influencers are still lacking in CGI quality, which is a key in ensuring that the trend takes off locally.

Another aspect that Indonesian brands need to consider when using virtual influencers is the risk of being "bullied or lectured (nyinyir)" by Indonesian netizens. "I can imagine that the comments on social media revolve around how these virtual influencers are in contrary with religious norms and Indonesian values. There might also be comments on how these virtual influencers are trying too hard to look like real humans but cannot live up to the standard," he added.

Meanwhile, Kobe's Leong said currently, only the big brands are using virtual influencers because they recognise the benefits. Once the ROI is justified, more brands will jump on the trend. That said, Leong explained that virtual influencers are currently mainly used on Instagram. If the usage of Instagram is not high in the country, it might not be able to take off easily unless the technology is adapted to other platforms, she said.

"The other factor we have to look at is the audience demographic. Virtual influencers are used mainly to reach out to the younger audience. If the country has a younger generation, it might also be easier to take off," she added.