How Much Should You Be Paying Influencers?
If you thought this blog post would be one line long and include a dollar figure, we’re sorry! Unfortunately, influencer pricing is not that simple - but don’t worry, we’re going to help break it down.
Think about working with an influencer like working with any person (link to other blog post) providing business services -- pricing is a negotiation. Who has leverage and why?
Here are some top level things to think about when determining the price to pay an influencer:
How many followers do they have?
Follower count is a good, but definitely not a definitive indication of how much you should pay an influencer. You can compare influencer’s prices and follower counts - but don’t forget to consider the next few points as well. You’ll also want to confirm that Influencers followers are real and in your target demographic.
What is their engagement rate?
Like follower count, engagement rate is a good, but definitely not perfect factor for deciding how much to pay an influencer. While engagement rate CAN show you how engaged the influencer’s audience is, keep in mind the ever-changing social media algorithms. It’s possible that (i) an influencer’s audience is more engaged via IG stories and DMs which you cannot see and/or (ii) the engagement you do see is not real or not from your target audience.
Follower count and engagement rate are probably the most simple to assess – but it’s important to consider the following less tangible items as well.
How organic is the match?
How obvious is it that you should be working together? For example, if a fashion influencer’s handle is say, @louboutinsandlove (yes, real influencer – she now goes by a different name) – it’s highly likely that she loves Christian Louboutin and that her audience loves Christian Louboutin, so Louboutin probably has some leverage in a negotiation to work with her.
Now, just as an example, let’s say a discount shoe retailer is looking to market their new line of high-end shoes. Well, @louboutinsandlove has an audience full of women who love high-end shoes – great choice for the discount retailer! But will she charge the discount retailer the same price she charged Louboutin? Maybe, but probably not. While the new line of high-end shoes is an organic fit, working with a discount retailer might not be. In this hypothetical case, the influencer has some leverage in negotiating the rate.
What is the price point of the product or experience you are providing and does it hold that value to the influencer?
The first point here is obvious. Let’s say you’re a bagel company working with food influencers. One bagel is not going to be as valuable as a year supply of bagels (yum!).
The second point is a little more nuanced. Let’s say you are marketing a mattress. You’ve found an influencer who is totally #hygge vibes and would make perfect sense for you to work with. You’re willing to offer her a mattress worth $2,000. Yes, you are correct -- that is ever so generous -- BUT she lives in a fourth floor walk-up with no doorman and the thought of the delivery alone is causing her anxiety. Plus, she actually thinks her current Ikea mattress is very cozy. The value of your $2,000 mattress is now zero, but the value of cold hard cash hasn’t changed. Her audience, will love the mattress you are marketing regardless.
What are you asking the influencer to do?
Here’s where the real negotiations come in. How much original content needs to be produced? How many posts are required? Is there specific messaging that needs to be included? Is there a specific or rushed deadline? Does this require the influencer to physically be in attendance? All these factors are going to affect the price of working with an influencer. The “math” is simple, the more work involved, the more you should expect to pay.
Who has ownership of the content?
Our lawyer did not help us write this (haha). So, disclosure, the following is simply marketing advice, not legal advice.
When engaging with an influencer, it’s important to note the difference between asking an influencer to create content and post that content to their channels and asking them to create content for your brand to use.
Working with an influencer is a great way to garner high quality original content without paying for a full photo-shoot, models, photographers, etc. However, keep in mind that the influencer producing the content has likely paid for some level of production and an influencer who is producing high quality content is likely savvy enough to know the value of that original content.
If your goal for an influencer marketing campaign is simply to reach the audience of the influencers you choose to work with, make sure that’s clear so you get the correct rate.
If you plan to use an influencer’s content for a Facebook advertising campaign or for your website – definitely make sure that’s clear in order to work out the proper usage rights and rate.
Doing all this upfront rather than trying to negotiate usage after the fact is way less of a headache, and you’ll likely get a better rate.
Hopefully, by keeping all of these factors in mind, you can determine the most appropriate rate for each influencer you chose to work with!