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For over a decade, performance marketing reigned supreme as the go-to strategy for measurable results. Brands could pinpoint every click, track conversions, and measure scroll depth with remarkable granularity. But that dominance is now facing headwinds. As privacy regulations tighten and major platforms reduce data-sharing capabilities, the once-fluid machine powered by third-party cookies is beginning to stall.
Marketers across industries have reported a significant spike in Customer Acquisition Costs (CAC) — with increases of up to 40 per cent in some verticals — forcing a re-evaluation of where marketing budgets are going.
From Performance-Only to Performance-Plus
Prominent brands that have adopted an integration of influencer and performance marketing methods are names like Haleon, ONDC and BoldCare.
Rather than outright cannibalizing performance budgets, influencer marketing is increasingly becoming a complementary force. According to Sajal Gupta, CEO of Kiaos Advertising, the shift isn’t about replacing one channel with another—it’s about convergence. “Brands are increasingly blending influencer and performance marketing tactics, rather than reallocating funds from one channel to another. The trend is towards integration and diversification, with performance-driven influencer campaigns. Hybrid models are becoming the norm,” Gupta explains.
As retargeting becomes less effective and lookalike audiences diminish in reliability, the ROI of traditional performance ads is no longer guaranteed. This shift is prompting brands to rethink their strategies, rebalancing media spends to include influencer marketing not just for reach or awareness, but for measurable performance outcomes.
Influencers as the New Performance Engines
What was once seen as a soft-focus awareness play has evolved into a hard-hitting marketing vehicle. Influencer marketing today is not merely about storytelling or brand love—it’s increasingly about conversion. Micro and nano influencers, in particular, are showing strong performance, driving high-intent traffic through loyal, highly engaged communities.
This shift is visible in high-profile campaigns like the recent launch of the LEGO Certified Store at Gurgaon's Ambience Mall. LEGO roped in influencers such as Sahiba Bali, Rohan Joshi, Kareema Barry, Ranvijay, Mythpat, and Payal Gaming to amplify excitement across social platforms.
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But the strategy didn’t stop at influence. LEGO also deployed a creative stop-motion film, charting a minifigure’s journey in search of a missing piece—ultimately revealed to be the store itself. Promoted via Instagram, InMobi, PVR Cinemas, and IPL ad slots, the campaign blended storytelling with strategic media buys to drive awareness and footfall.
Measuring What Matters
As influencer campaigns mature, the metrics are evolving too. Trackable links, discount codes, and in-app shopping integrations now provide brands with tangible performance data.
“Influencer content now has direct CTAs, trackable links, discount codes, even in-app shopping integration. We're seeing ROI metrics rival paid search for certain campaigns. And the halo effect—brand recall, sentiment, organic reach—doesn’t show up in spreadsheets, but it’s real,” say industry experts.
Gautam Madhavan, Founder of Xley.ai, explained, “What happens is now brands are using creators' content as UGC. For example, if there's an influencer who is popular in Indore, they first create the content—and that same content is repurposed to run ads in Indore so that the recall value of that content is high. So, yeah, that's how they are complementary to each other.”
Redefining the Funnel
The evolution of influencer marketing doesn’t mean that brands are turning their backs on traditional performance tactics. Instead, they’re recalibrating how different parts of the funnel are approached. Influencers serve as top-of-the-funnel drivers—sparking awareness and curiosity through engaging, relatable content. And thanks to features like product tagging and direct links, they can push users into the consideration stage or even drive purchases.
Having said that, the core strength of influencer campaigns still lies in their narrative ability—building trust through authentic voices. Performance marketing, meanwhile, continues to dominate at the bottom of the funnel, converting intent into action. Together, these two approaches create a new kind of synergy—one where storytelling and data-driven execution are no longer separate, but strategic allies.
Complemented by influencer marketing or UGC content, traditional performance marketing like tools such as pay-per-click (PPC) ads, affiliate marketing, content recommendation engines, and social media ads are being optimized for conversions. A Google search ad that charges per click, a fashion blogger earning affiliate commissions, a Facebook campaign optimized for purchases—all of these fall under the performance umbrella. They rely heavily on metrics such as CTR (Click-Through Rate), CPA (Cost Per Acquisition), and ROAS (Return on Ad Spend) to justify spend and scale impact.
According to early 2025 estimates, brands are now directing nearly 25–30% of their digital ad spend toward influencer marketing. Insights platform KlugKlug reports a 27% rise in brands shifting more than a quarter of their total ad budgets toward influencers.
In response, platforms themselves are adapting. Instagram, YouTube Shorts, and even LinkedIn are developing creator tools that blur the line between influencer content and performance advertising. Shoppable posts, affiliate tags, and advanced analytics are making it easier for marketers to measure hard outcomes from influencer activations.
LinkedIn’s recent push into short-form video and expanded monetization features is even fueling a wave of B2B influencer campaigns—ones that resemble traditional lead-gen ads, but are delivered through real people, with real stories.
While influencer marketing is gaining share of wallet, marketers aren’t abandoning performance tactics. “We’re creating influencer-led performance funnels now,” said Gupta. “Think top-funnel Instagram or YouTube creator content leading into a paid retargeting campaign. It’s not about choosing between them anymore—it’s about how well they complement each other.”
"In a privacy-first world, the most successful marketers won’t rely solely on data or only on storytelling," Sajal Gupta said.
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