Are you confused and frustrated by influencer marketing (content creator) negotiations? Don’t worry you are in good company (NOTE: we at Socialpeeks consider ourselves good company). Like any new market, Influencer Marketing is the Wild West out there. Given the many variables that go into any influencer campaign, building benchmarks and industry standards are nearly impossible.
At Socialpeeks we do one thing really really well...micro-influencer marketing. Our customers include some of the world's most iconic brands and our campaign directors have worked with hundreds of influencers over countless campaigns. Along the way, we have learned a lot about influencer pricing and made our share of mistakes. Here are our key learnings about influencer pricing and negotiations.
EVERYONE WANTS TO GET PAID
Two years ago we ran a number of campaigns where “free product” was the incentive. We have recently observed that influencers with a relatively low number of followers are often looking for monetary value from a campaign. The bad news is that prices are going up. The good news is any serious content creator has a media kit you can request. Remember like the price of a house, pricing in a media kit is the “initial” offer. Most influencers set the price high expecting to have to negotiate a bit.
INFLUENCER MARKETING PRICING 101
Basics to get you started:
- Estimate the time you believe an influencer will spend on your campaign content. That will help you assign a value to an hour of their time. This is often a healthy way to negotiate any contract.
- One basic influencer marketing guideline used by some is:
Follower Count x 0.1111 = Price per post.
(Example: an influencer with 150,000 is worth $1,666.5)
- Moneyish weighed in on influencer pricing scenarios as well. (Note: the estimates in this article are lower than what we have seen across our Socialpeeks campaign experience).
Some additional factors that can go into the negotiation:
- Is the post exclusive (i.e. only one product in the post) vs. non-exclusive (e.g. outfit featuring a number of brands). Non-exclusive post(s) cost less as the influencer could monetize a number of brands with that single post.
- Will the content be reused by the brand? Typically influencers would want much more if their photo or video will eventually become a marketing asset for the brand.
INFLUENCER INCENTIVE TRIANGLE
Early on we discovered a rare universal truth - that influencers derive value from a campaign in 3 ways. We call this the influencer incentive triangle and your compensation package needs to fall somewhere within this triangle
Does the campaign include cool products and services?
It goes without saying that a good social influencer aligns with your product/brand. That means they appreciate the free goodies that come with your campaign. Often the value of a product is far more than the cost to make it. For example, offering an influencer $500 in fitness apparel might only cost the brand less than $100. It never hurts to add the value of products and samples into your influencer offer.
Elevate the influencers brand (there are actually two ways to do to this)
Showcase the influencer content.
We recently did a campaign with a global food brand. Influencers were asked to create and share their own recipes. The influencers Instagram content and corresponding recipes were featured on the Brand's official site. Pretty cool right?!... The influencers thought so. Despite the significant work influencers had to invest to create their amazing content, compensation in this campaign was surprisingly low. We attributed this to the additional exposure the campaign provided everyone. To fans of this brand, these influencers were “Celebrity Chefs”.
Bottom line, influences might be willing to demand less money for the chance to be featured in a cool campaign. The key is to make sure they get great visibility.
Giveaways and Contest for influencer followers.
I often remind clients: great influencers are like their own radio station, complete with a built-in audience. Empowering the influencers with the ability to offer their fans special discounts, prizes, contest or giveaways is a great way for them to add value to their followers and attract an even bigger audience.
Ok I know I already discussed monetary compensation but I’m mentioning it as again as it is the most important and contentious. The formula for influencer compensation is simple
[What are we asking the influencer to do] vs [what are we willing to give them]
If we hire a social creator to “use a product over a number of weeks, posting frequent updates” it will cost more than a single Instagram post. Likewise, If we want to send an influencer a product and have them create “unboxing”, content it should cost less than asking an influencer to visit a site or event to share experiential content. Needless to say, influencer monetary compensation is a topic that deserves its own section which is why we mentioned it above.
Ultimately there are no hard and fast rules for influencer compensation. Following the basics, I have described above and having a genuine respect for people's time and talent will serve you well in your influencer negotiations.
CALL TO ACTION
Socialpeeks is more than an Influencer Marketing Agency and we are certainly not a database of influencers. We have built priority software to analyze Instagram, YouTube and Twitter to hyper-specific influencers.
Our campaign directors can help you design, execute, and measure campaigns of any size for any market.
It never hurts to chat. Fill out the form below and we can begin by simply answering any questions you might have. We are happy to give you our professional opinion on some influencers you are considering.