What should influencer marketing cost? There is no magic number of what influencer marketing should cost for your brand. A lot of the exact budgeting numbers and gifting costs will be found through trial and error as you grow your influencer marketing program for your brand.
Linqia just released some interesting statistics about the future of influencer marketing budgets:
For marketers with $500,000+ marketing budgets, 39% plan to increase their spend on influencer marketing in the next year.
54% of digital marketers are planning to spend more than $250,000 on influencer marketing
Some marketers (17%) even plan on spending more than $1 million on influencer marketing in the next year.
However, there are plenty of costs that can be planned beforehand if you are creating a budget for your influencer marketing campaign. Knowing all the ways that different costs are involved in your influencer marketing campaigns will help you plan a successful campaign that generates results!
All the Influencer Marketing Cost
Product Gifting Costs
Product gifting costs should be the first expense to consider when planning your influencer marketing campaigns. How many products are you planning on sending? How many can you realistically afford to send?
When considering the cost of products sent to influencers, it is important to remember your margin. Margin is the amount you’ve marked up a product past the cost. It is another way of saying markup or profit.
You want to make sure that your calculations for product gifting are accounting for the margin. As these are being gifted instead of purchase, the cost of the product sent does not include this margin or markup.
Influencer Payment Costs
Some influencers may require additional payments in exchange for the content that they post. These influencer payments should be evaluated on a case by case basis, considering all that the influencer is offering and the metrics associated with the influencer’s account. Checking their engagement score and looking for any signs of fake or bought engagement can help ensure that you get consistent results for your brand.
In addition to evaluating each influencer before negotiating and agreeing to payment, there are several payment structures that can help you get the most out of your influencer collaborations.
Pay-per-post= a flat fee in exchange for a post from an influencer.
Pay-per-click= payment is based off of each click on the post. Influencers should use a link to the brand’s website that includes tracked parameters so that the brand can confirm how many visitors clicked on the link. It is not as common as other pricing structures.
Pay-per-acquisition= This option goes a step further than the pay-per-click model and uses tracked links to determine when someone clicks through and takes an action on the site. This could be joining the email list or making a purchase. Influencers are typically focused on driving brand awareness, so this type of pricing structure is extremely uncommon.
Pay-per-impression= This model of payment relies on how many people see the influencer’s content. The influencer gets paid based on the rate agreed upon multiplied by the impressions that the post(s) received. This relies on the metrics that are tracked through the social platform that the influencer posts to.
How much does it cost to ship the item(s) to the influencers? This is an important consideration when choosing your influencers. If an influencer is located out of the country or out of the countries that you can easily ship to, then the cost will skyrocket. If you work with an influencer outside of the countries that you sell to, you may also be volunteering to spend additional time and resources to organize the shipping, since your normal fulfillment processes may not work for that country.
Knowing the countries that you can easily ship to will help you know which influencers you can work with. No one wants a surprise shipping blunder!
Support could include the marketing assistant answering the email inquiries from influencers, the customer service agents who help with a shipping error, or the marketing manager who spends hours tracking the analytics of the campaign to see if it was successful. All of these people have a cost associated with the time they spent to help influencer marketing run.
If you are looking to devote employee hours to helping your influencer marketing, then tracking success is especially important. Results can help to justify those hours of work and help you gain additional help in the future.
Do you plan to invest additional funds in order to promote the influencer’s content? In some cases, it might work well to boost the influencer’s post on Instagram or Facebook so that it reaches more people.
At this point, Facebook is pay-to-play, so if you are planning on using that platform, you’ll want to devote some additional ad dollars to help your influencer’s content succeed. Using influencer content in your brand’s advertising can also be a successful tactic for your marketing, so it may be worth budgeting that in from the beginning.
All the Return on Investment
In order for your influencer marketing to be successful, you’ll need to be able to track your return on investment. Depending on your brand’s goals, you’ll want to look at different metrics.
Check out “How to Measure Your Success with an Influencer” to see a complete explanation about tracking your influencer marketing. Here are a few ways that influencer marketing successes can justify additional budget to devote to your influencer content.
Getting eyes on your content can be the biggest challenge for brands. Impressions across social channels can be especially challenging with brand’s combating the latest algorithm changes.
Influencers can share content about your brand with their audience, leading to thousands of new impressions. The top level of most brand’s conversion funnel is impressions, but impressions can also lead to site visits and conversions.
Does the influencer’s audience know your name? Know your website? Know what you sell? All of these little achievements can lead to new customers and leads for your brand. If they learn your name, then they may think of you first when they are in the market for your products.
Brand awareness is typically the primary goal for influencer marketing campaigns. Cultivating a long-term relationship with influencers is the best way to help the influencer’s audience become acquainted with your brand and eventually become customers.
Revenue is always the driving force behind any marketing campaign, so being able to measure the sales from a particular campaign can help prove the success of your influencer marketing.
There are a number of ways that you can track the sales that come through a particular influencer. A coupon code offers an added incentive for their audience to convert. At the same time, it allows you to see which customers were recommended by that influencer. Tracked links and monitoring your overall revenue from that marketing channel can also help you measure how many sales were referred by influencers.
If the influencer is sending their audience over to your website, then your website should be optimized in order to capture those visitors’ information so that you can complete the conversion through remarketing. An email signup form that can be easily found is essential to adding site visitors to your email marketing lists. You should include social share buttons or social like buttons. Then, you’ll be able to target visitors with ads that show the products that they were interested in on their first visit.
In addition to visitors, you can capture an influencer’s audience by asking the influencer to tag you in the post. They can also recommend that their audience follows you on social media.
These little optimizations to influencer campaigns can help you grow the results exponentially.
What Should Influencer Marketing Cost? Is Influencer Marketing Worth the Investment?
Definitely! Neoreach estimates that influencer marketing generates 5.2x per $1 spent in earned media value (EMV). EMV refers to any type of social media exposure gained organically. 5.2x EMV for an influencer marketing campaign means that influencers were able to generate 5.2x the interactions from potential customers than the brand would normally experience. Can you imagine generating 5.2 times the site visits, social follows, or purchases? That could mean huge boosts to your bottom line!