Do You Know How Much Should You Pay Your Brand Influencers?

Consumers’ trust in brands continues to decrease year-over-year, and they actively find new ways to avoid company advertising. This presents a challenge for marketing teams, as they now must explore different ways to connect and build relationships with their audiences.

It should come as no surprise that people most commonly turn to their friends, colleagues, and family to inform their purchasing decisions. But another avenue has become increasingly influential in shaping consumer purchasing habits—brand influencers.

Although some marketers have questioned the value of influencer marketing, these engagements have proven to be a powerful and potentially cost-effective way to expand a brand’s reach:

  • Marketers who implemented an influencer marketing campaign saw an average of $6.85 in media value for every $1 spent on paid media.
  • 63% of consumers between 18 and 34 say that they trust what influencers say about brands much more than what brands say about themselves.
  • 58% of consumers surveyed said they have even purchased a new product because of an influencer in the last six months.

To maximize the potential results from an influencer marketing campaign, marketers need to understand what value they can expect from influencer marketing, the different types of influencers available, and how much to pay a brand influencer.

Determining the Value of an Influencer Collaboration

Before racing to sign on a high-profile influencer to partner with your brand, your team needs first to identify your brand’s goals and objectives for the influencer relationship.

When developing your initial engagement plan, ask your team these questions to build out your program goals:

  • What do we hope to gain by partnering with this influencer?
  • What do we expect of the influencer in this partnership?
  • Do we want a long-term engagement or just a single campaign?
  • How does this influencer’s audience differ from our existing audience? Do they reach a niche audience we have yet to tap into?
  • What do we want this influencer’s audience to do as a result of the collaboration?
  • How will success be measured? Are we looking for a direct financial return or something else?

Based on a study by BigCommerce, the most common influencer marketing goals are to increase brand awareness (85%), reach new audiences (71%), generate sales (64%), and support lead generation (42%). This was mirrored in a 2020 study by TopRank Marketing, which found that the top B2B influencer marketing goals are brand awareness (84%), lead generation (69%), improved brand reputation (58%), and brand advocacy (32%).

Once you align your team’s goals for the engagement, assess which of your existing marketing activities are also working toward these goals and how much these activities cost. By thinking about what your brand would otherwise pay to drive the same ROI as you hope to gain from your influencer program, you can have a better idea of your potential influencer program scope.

To Pay Influencers or Not to Pay?

With your influencer engagement goals decided, it’s time to explore your team’s financial constraints.

Some brands pride themselves on working only with unpaid advocates, but this strategy can only go so far. And while a brand fan may let you use some of their user-generated content without a fee, it’s unlikely that you’ll be able to convince an influencer to create original work without some means of compensation. This is especially true in the B2B space, where top influencers are often consultants whose primary income is from charging for their time and ideas.

There always needs to be something in it for the influencer, including:

  • Cash compensation
  • Product gifting
  • Promotion of their platform or products by your brand
  • Exclusive event access

There are countless other possibilities depending on the influencer, their goals, and what your brand can provide.

In 2020, 38% of B2B brands said their budget for influencer marketing would increase in 2021, and only 9% would decrease their budget, suggesting that brands see value in paying their influencers. The majority of influencers (61%) prefer monetary compensation over all other types of collaboration arrangements. Still, there are several pros and cons that marketers should evaluate on a case-by-case basis to create a win-win partnership:

PAYING INFLUENCERS

  • Pros:
    • The brand can request content review and approval in the contract.
    • The contract includes the sharing of metrics and results data.
    • Influencer feels fairly compensated for their time and influence.
  • Cons:
    • If it’s not a good brand fit, it can come across as inauthentic and not resonate with the influencer’s followers.
    • Some influencers so frequently shill for brands that their effectiveness is waning.

NOT PAYING INFLUENCERS

  • Pros:
    • Only those influencers who genuinely love your brand will share about it, giving an air of authenticity paid promotion may lack.
    • There is significant value to unpaid brand praise from an influencer who doesn’t engage in sponsored content/brand promotion.
  • Cons:
    • Brand lacks control over or ability to pre-review influencer’s content.
    • No data is available.
    • Influencers may feel taken advantage of by the brand.

Influencers Aren’t All the Same, and Neither is Their Compensation

The stereotypical “influencer” is a celebrity-level name with hundreds of thousands of followers on any social media platform. Yet, having an impressive number of followers doesn’t necessarily mean that the influencer can drive those fans to action. This is especially true if many of those fans are bots or were possibly purchased.

That is why you need to look beyond an influencer’s follower count to determine who is a good fit for your brand and how to compensate them fairly.

There are a growing number of nano- and micro-influencers, which, as their names would suggest, have significantly smaller social media followers. However, they may have a deeper connection with their fans and a stronger ability to influence their purchasing decisions.

Engagement is a crucial consideration here, and nano-influencers (those with less than 10,000 followers) on Instagram have 7x more engagement than mega-influencers (100,000+ followers), or engagement of 7.2% versus 1.1%, respectively. On Twitter, these engagement rates are 1.4% for nano-influencers and .3% for mega-influencers.

Usually, celebrity-level influencers will set their rates solely on their following size, not their ability to drive engagement. This tier of influencers will also typically have an agent or agency representative that you must work with to come to an agreement. That person can discuss the unique benefits of partnering with that celebrity-level influencer.

Micro-influencers will typically have a significantly lower cost-per-engagement and a greater ability to drive more qualified traffic to your site, and you will directly coordinate with them.

What Influencers Are Earning

There is no one-size-fits-all approach that you can use to evaluate an influencer’s value, but several studies have explored what typical influencer engagement rates cost.

Per WebFX and Buffer, these are the typical influencer engagement costs by platform:

  • Instagram posts average $10 per 1,000 followers, meaning that an influencer with 10,000 followers will likely charge $100 per post. You can also explore an engagement-based model, which can range from $250-$750 for 1,000 engagements (likes, comments).
  • Facebook posts are an average of $25 per 1,000 followers, so an influencer with 10,000 followers could charge $250 per post.
  • Twitter posts average $2 per 1,000 followers, or $20 for 10,000 followers.
  • Blog posts average $60 per 1,000 unique visitors.

It is important to remember that these rates could fluctuate based on any special content needs, such as video creation or travel costs related to creating the post. Additionally, PRWeek reports that influencer rates are rising, with a 44% increase in the price for an Instagram post between 2018 and 2019.

Influencers Reflect Your Brand Values—Choose Wisely

Whichever influencer type you choose, ensure that the individual, their brand, and their reputation align with your company values because the influencers you align with can directly impact your brand’s reputation.

Now more than ever, businesses must be diligent in selecting an influencer that mirrors their values. Traackr research from 2020 shows that brands and influencers can no longer stay out of the conversation on social justice and significant world issues. A mispositioned statement or backtracking on a promise, though, could result in widespread scrutiny (which often translates to calls for that brand or influencer to be “canceled.” Even further, members of marginalized communities are deterred from brands that appear to capitalize on legitimate social strife through half-baked and inauthentic influencer campaigns (especially when those influencers do not match the community most affected).

Just a few instances where brands have engaged with misaligned influencers, or have had to cut ties due to influencer scandals, include:

How to Find the Right Influencer for Your Brand

To minimize your risk of engaging with an influencer that could damage your brand reputation, you’ll need to do your due diligence. This includes having a thorough vetting process before reaching out to an influencer to ensure they are a good fit for your brand. You’ll also want to have a consistent process for interviewing potential influencers to gauge mutual fit.

HOW TO IDENTIFY A GREAT POTENTIAL INFLUENCER

When first researching influencers, follow these steps to identify any potential mismatches between the influencer and your brand values:

  • Review the influencer’s most engaged-with followers and their recent post likes and comments.
  • Google the influencer’s name and review the top headlines. Refine this search by including search terms like “[influencer name]” and “scandal,” “troubled,” “controversial,” or “problematic.”
  • Read their recent content and note how they do or don’t engage with commenters, especially those with differing perspectives.
  • Watch their videos to get a feel for their voice, tone, and on-camera personality.
  • Note which other brands this influencer has partnered with, and assess whether those brands have similar values to your brand.
  • Use your SEO tools to evaluate the influencer’s owned content platform.
  • Monitor their social feeds to understand how they engage with their community regularly.

HOW TO ASSESS AN INFLUENCER FOR BRAND FIT

After you have identified a list of potentially aligned influencers, set up individual introductory calls. In these calls, you’ll want to understand their brand better and ensure a partnership will be mutually beneficial. Ask these questions during the call to get a better gauge of the individual’s brand and priorities:

  • Why do you want to partner with our brand? What specifically makes us appealing to you?
  • How many brands do you typically partner with in a given month?
  • What are some of the recent brand campaigns you’ve participated in? What was the ROI or other results?
  • What are your typical rates for a project, such as the one we are scoping here?
  • What is your typical reach and engagement rate for your influencer projects?
  • Do you use your platform to advocate for social justice issues? Why or why not?
  • What are some causes you are most likely to advocate for?
  • What would you do if a brand you partner with is involved in a scandal or controversy that conflicts with your personal values?

If your prospective influencer is unable—or unwilling—to answer any of these above questions, they may not be a viable option at this time. For your brand to drive results with its influencer engagement, your team needs to find influencers that can actually drive results, not just blast messages at a disengaged audience.

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