A decade ago, when social media started becoming an integral part of our daily life, influencer marketing was limited to well-known celebrities or public figures.
Nowadays, social media influencers at all ends of the spectrum are found anywhere and everywhere.
What is Influencer Marketing?
Fundamentally, influencer marketing is a form of social media marketing that leverages other people to endorse products or services.
Influencer marketing typically utilises people who have a larger than average following on various social media platforms.
Influencers with large followers tend to have earned a high level of trust with their followers, and personal recommendations act as social proof to a brand’s potential customers.
For this reason, influencer marketing has solidly established itself as one of the most effective ways to reach new and targeted audiences.
But, many brands are confused and wonder how much does influencer marketing cost? How much should I pay influencers for my social media marketing campaign?
While there is no standardisation of what influencers charge for paid partnerships, several factors need to be taken into account.
Once all of the factors have been considered, you can begin to have a clearer idea of what your brand can expect to pay for your next social media collaboration.
In this post, we will share the many factors that you need to consider before engaging in social media marketing. We will also outline how these factors impact influencer marketing prices.
Ultimately, after reading this article, we hope that you will be able to find influencers that best fit your brand; Allowing you to maximise the ROI (Return on Investment) for your influencer marketing campaign.
- Ballpark Rates – How Much Does an Influencer Make Per Post
- 10 Key Factors That Affect Influencer Pricing
- Types of Collaborations
- How to Establish a Budget for Influencer Partnerships
- How to Know if Influencer Costs Are Fair
Ballpark Rates – How Much Does an Influencer Make Per Post?
While this article will ultimately discuss how there is not a one-size-fits-all for influencer campaigns, we can try to give a ballpark or an average price guideline for those who want a quick answer.
The most important metric is the number of followers or subscribers an influencer has, but as we delve deeper, it is by no means the only metric.
However, most influencers haven’t gamed the system by purchasing fake followers, so if only one metric were to be used to ascertain how much influencers should be paid, this one would be it.
Here is a breakdown of the estimated pricing model for sponsored posts based on an influencer’s follower count:
Influencer Marketing Pricing
Instagram Influencers Average Cost
- Nano influencers (1,000 – 10,000 followers): $75–$250 per post
- Micro influencers(10,000 – 50,000 followers): $250–$500 per post
- Mid-tier influencers(50,000 – 500,000 followers): $500–$5,000 per post
- Macro influencers (500,000 – 1,000,000 follower): $5,000–$10,000 per post
- Mega influencers: (1,000,000 followers plus) $10,000+ per post
YouTube Influencers Average Cost
- Nano-influencers (1,000 – 10,000): $50–$200 per video
- Micro-influencers (10,000 – 50,000): $200–$2,000 per video
- Mid-tier influencers 50,000 – 500,000): $2,000–$15,000 per video
- Macro-influencers (500,000 – 1,000,000): $15,000–$40,000 per post
- Mega-influencers: (One Million Followers plus) $40,000+ per post
10 Key Factors That Affect Influencer Pricing
There are quite a few factors that impact how much money an influencer can generate from sponsored content. Many businesses working with influencers can tell you that it is uncommon for an influencer to have a set rate.
While there are many other factors that determine how much a fair price is to pay an influencer, we have compiled what we believe to be the Top 10 dynamics for influencer marketing.
- Number of Followers
- Influencer Marketing Platforms
- Engagement Rate
- Single Post vs Multiple Post Rate
- Type of Influencer Marketing Campaigns
- Production Costs
- Seasonal Demand
- Usage Rights
1) Number of Followers
The number of followers or subscribers an influencer has on social media directly correlates with their potential reach. The more followers a social media influencer has, the more eyes are likely to see their content.
As a result, this factor is perhaps the most important metric of all to determine the appropriate rate.
However, by no means is it the only metric that should be considered.
Influencers can be categorised based on their amount of followers. The table above lists some of the popular terminologies within the industry.
2) Influencer Marketing Platforms
Instagram influencers lead the way for influencer marketing platforms, with YouTube following closely behind.
Therefore, an Instagram influencer with 100,000 followers could expect to earn more per post than an influencer with a similar following on Facebook or Twitter.
TikTok has gained traction more recently, while Snapchat lags behind with the company struggling to catch up on influencer marketing due to early feature limitations.
While they have attempted to make inroads to correct these issues, it seems most brands have delegated Snapchat to the bottom of their hit list.
According to Media Kix, the top five most strategically important social media channels are:
- Instagram 89%
- YouTube 70%
- Facebook 45%
- Blogs 44%
- Twitter 33%
3) Engagement Rate
Follower engagement is an essential metric to factor into all influencer marketing campaigns. An engagement rate is a calculation expressed as a percentage that highlights how much interaction an influencer generates.
The engagement rate is a very important metric to predetermine your expected influencer marketing ROI. You may believe that the higher the number of followers an influence has, the better their engagement rate is going to be, but regularly the opposite is true.
For the above reason, many brands, particularly smaller brands, opt to use nano or micro influencers for their influencer marketing campaigns.
The website Social Blade is a great resource that allows you to check engagement rates. Social Blade tracks user statistics for all leading social media platforms including Instagram, YouTube, and Facebook to better understand influencer reach.
Success with influencer marketing largely depends on finding the perfect influencer for your brand – an expert in your field.
For example, if a brand were in the fitness industry, it wouldn’t optimise its campaign by engaging influencers who are known in the travel or crypto space.
By aligning with a trusted expert within a specific niche, it will position a brand too as an expert.
Similarly, if a brand caters exclusively to the Australian demographic, it would be wise to choose influencers located in Australia. Naturally, Aussie influencers are much more likely to have a predominantly Australian-based following.
Suppose a brand does not specifically fit into a popular niche such as beauty, fitness, or food. In that case, they find out what industries an influencer’s audience favours, and determine if it makes sense to collaborate with that influencer for their influencer marketing campaign.
If you want to work with an expert within a chosen niche, expect to pay extra.
5) Single Post Rate Vs Multiple Post Rate
If you are looking at engaging an influencer for a one-time post, expect to pay a little bit extra than multiple posts or an ongoing collaboration.
Other brands like to work with specific influencers on a contract basis, generally, 3-12 months. Longer timeframe contractual agreements allow brands to reduce their costs. Influencer marketing costs are reduced significantly on a per post basis.
The other advantage is multi-touch campaigns are a proven strategy to reach your target audience. A consistent message in a variety of formats reinforces your message and boosts brand awareness.
6) Type of Influencer Marketing Campaigns
The type of content you request an influencer to create can impact influencer marketing costs. Many Instagram influencers will charge different rates according to the content type that is requested.
For example, reels are very on-trend. If a brand requests an influencer create a reel, they will most likely charge extra as it will demand additional creativity on their behalf.
7) Production Costs
A key consideration for influencer marketing pricing is the type of content you are asking an influencer to create. This is because not all briefs are equal. Some will require significantly more time and resources.
You may require an influencer to attend a specific event or film a sequence of shots and comprehensively explain your product or brand.
It is important to consider the more time, energy, and resources required to fulfil your content brief, the more you should expect to pay.
8) Seasonal Demand
Christmas, Black Friday are two examples of when digital marketing goes into overdrive. Many brands are lining up with their influencer marketing budgets, ready to splurge.
But, if you’re asking an Instagram influencer to promote your brand during these high-demand periods, you should expect to pay premium rates to compete with other brands.
Influencers rely on promoting multiple businesses to make a living. Many brands may opt to work with a particular influencer on an exclusive basis. This means they put in place a non-compete contractual arrangement or exclusive clause that prevents the influencer from working with a particular company or companies for a specified period of time.
However, brands should expect to pay extra for such an arrangement as limits the influencers earning capacity.
10) Usage Rights
If you’re planning to utilise paid content for other purposes, e.g. paid ads, feature imagery in catalogues, other promotional materials, or across other social networks, many influencers will charge a bit extra.
A paid collaboration should be considered as one product. If you want to repurpose that content, it should be considered as an additional product.
Influencer amplification is one example of repurposing a marketing strategy to boost influencer marketing ROI. Instead of repurposing the content and distributing it through the brand’s handle, influencer amplification links the influencer’s handle to the brand’s ad account for social proof marketing.
Types of Collaborations
Now that you have ballpark figures in mind and understand the various factors involved with influencer marketing, let’s outline the types of influencer marketing partnerships you can choose from.
With various social media platforms, there are various influencer marketing formats that brands and influencers regularly provide. Below are the most popular examples.
One of the most cost-effective ways a brand can reach new audiences on social media is with gifting. Gifting is a low-cost way to build brand awareness and foster influencer relationships.
Gifting is when a brand sends influencers free products in exchange for a post or story sequence where they share something positive about your product or brand.
Gifting can be coordinated with an expectation of a particular action being taken, e.g a post or story, or it can be sent without any obligation to share.
While gifting with an expectation of a particular action can work with influencers with a smaller audience, such as nano or micro influencers, don’t expect to work with influencers with a million followers.
Of course, it may, if the product is worth a lot of money, but don’t expect too much from an influencer with a large following for an item of little value.
A shoutout could be a good strategy for brands with a small influencer marketing budget. It is when a brand pays an influencer typically for a one-time post or story sequence with or without fancy imagery or videography.
It is a classic digital marketing strategy used to share positive stories about a brand’s product or service with a call to action where the audience is directed to a social media channel or website for further information.
Shoutouts for shoutouts is another strategy that is probably the closest thing to free influencer marketing as possible if free influencer marketing is what you are seeking.
To get a free shoutout, similar-sized brands that compliment each other – for example, are located in the same suburb – give each other a shoutout.
Giveaways are a fantastic strategy to generate brand awareness and grow a brand’s and influencers’ social media channel.
Giveaways work when a brand either gifts a product or pays an influencer to run a giveaway of a product on their social media platforms. Typically, the influencer will ask their audience to tag a friend or friends, and in order to be eligible to win, the participant must be following both the brand page and the influencer page.
Giveaways usually generate a lot of hype and result in increased brand awareness and prospective new clients via the additional influx of new followers that are generated from the giveaway.
Affiliate marketing is a great safeguard for brands who may have trepidations about entering the brave new world of influencer marketing.
Just like affiliate marketing in a traditional market, it works the same way with influencer marketing. An influencer will get paid a commission with each sale they generate after promoting a brand’s products via an affiliate link or an affiliate code.
While this form of influencer partnership can be tilted in favour of the brand, it can be quite beneficial for influencers too. If the product is popular, an influencer can make ongoing commissions by sharing a product periodically on their Instagram stories.
A brand ambassador is an individual who is chosen to represent a brand. An ambassador essentially becomes the face of a brand and is typically a long-term arrangement.
The ambassador is often a high-profile personality who shares the same values to a brand and will create a positive image, providing you find the right fit.
Sponsored content is the generic term for probably the most common forms of influencer marketing. It allows brands to either provide content or request content to be created by the influencer to share on their social media platform.
Brands may frame creative mandates or allow the influencer the creative freedom to create content however they like.
How to Establish a Budget for Influencer Partnerships
When considering a proposed budget, a brand should take into account the goals that they wish to achieve. The most common goal, particularly for larger brands, is brand awareness and increased social engagement.
Obviously, increasing sales is the ultimate goal with any campaign, however reaching new audiences, gaining new followers, increasing social engagement, and generating leads into the sales funnel are all critical steps before sales can occur.
Once a brand has defined its goals, it can begin to think about who the ideal influencers would be to achieve those goals and what a reasonable budget allocation would be.
How to Know if Influencer Costs Are Fair?
As discussed, there is a significant disparity with influencer rates. The only metric to ensure a brand is not paying too much when an influencer promotes their business is the ROI (Return on Investment).
A campaign performance will determine if the rates paid out are fair reasonable. For example, if a brand invests $10,000 in social media marketing and receives $75,000 back in sales, you would consider it to be money well spent. However, if the same investment only resulted in $20,000 in sales, a brand may find that other forms of advertising work better for their business.
This approach means you will need to test the waters first before knowing whether or not a relationship is worth continuing.
To gauge whether or not it is worthwhile to hire an influencer before discovering the ROI (Return on Investment, it is advised to research previous campaigns the influencer has done that may be similar and determine if it was successful.
Brands are also encouraged to seek influencers Media Kits or Rate Cards to find out what an influencer charges and compare their rates with other influencers.
Influencer marketing is a proven, cost-effective strategy that works for many businesses, but may not work for all of them.
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