Vertical Networks May Be the Future of Influencer Marketing

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One of the terms internet startups loved to use in the early days with venture capitalists was “one-stop shop.” It signified a company that provides a multitude of services—one that’s able to service an entire category and can claim ownership to a large addressable market. In reality, it didn’t always work that way. Different audiences have different preferences.

Facebook started in universities, and it was very successful in its early days by creating closed communities for students and building a network within those channels. For a time, it seemed impossible to compete with Facebook. This networking effect—the idea that the people you wanted to see were on Facebook—was impossible to duplicate at the time. You could build a similar site, but your friends wouldn’t be there.

As Facebook evolved, it expanded and began facing the challenges of a one-stop-shop-type solution. How do you keep such a diverse group of users satisfied when their individual needs and desires vary greatly? It’s easy to curate content when all you have in a network are your friends from college. But what happens when your friend list includes your mom, friends from high school, your coworkers and the funny guy you met at lunch last week?

Over the past few years, there’s been an emergence of verticalized social networks—often enormous ones—that offer a superior experience within a specific category. This isn’t a new phenomenon, but it takes a while and has infiltrated many industries.

craigslist—one of the iconic websites of the internet’s early days—offers a “classifieds” solution for every vertical you can think of, which was enough to initially satisfy every audience. But, over time, competitors emerged in rapidly diversifying categories.

Need short term rentals? Meet Airbnb. Looking for jobs? Log on to Indeed or Simply Hired. Looking for love? Check out OkCupid or Match. Need temporary workers? TaskRabbit and Elance have you covered. Looking for a quirky arts-and-crafts gift? Etsy is the place. In a pinch and need some legal advice? LegalZoom can handle that. Do you want tickets to the next Yankees game? Check out StubHub. You get the idea.

While craigslist offers a perfectly fine answer for each of these categories, these competitors were able to build solutions that were customized for a specific audience. Like other generalist websites, craigslist isn’t positioned to compete with the ultra-targeted vertical sites that can offer a fitted solution to their audience base. It’s like the difference between buying a tailored suit versus one off the rack.

Granted, these niche solutions don’t happen overnight, but craigslist is slowly seeing a drop in its respective market share for many of these verticals. SimilarWeb ranks craigslist as the 59th largest website on the internet. This is a drop from 41st in 2015 and 27th in 2013.

It is not hard to notice similar movement on social networks, as vertical-focused platforms like PicsArt, TikTok, Twitch, Pinterest and others gain a foothold by offering customized opportunities for brands to reach the right audiences. These platforms are also actively working to solve the challenges that traditionally plague the market, which bigger platforms such as Facebook and Instagram haven’t been able to fix. For example, Pinterest released a developer’s application-programming interface for select influencer marketing partners (Hypr is one of them).

PicsArt, a Sequoia Capital and Insight Venture Partners company, has over 100 million monthly users who share a common interest in artistic verticals. It is actively working on improving the experience of working with influencers on its platform by offering tools for discoverability, audience targeting, activation automation, measurement and reporting.

PicsArt is doing what some other platforms have traditionally ignored by nurturing an in-house influencer community and choosing to curate influencers that are rooted in creative interests, versus the usual lifestyle influencer.