9 KEY FACTORS THAT IMPACT INFLUENCER PRICING FOR BRANDS
Seeing the cost of an influencer campaign without knowing the details of it is actually pretty meaningless.
Is it a 30-second spot or a whole video? Does the brand want permission to use the video in their paid ads indefinitely?
The reality is that the cost of an influencer is usually made up of many of these details including the project’s usage rights, scope, or other factors.
And while seeing the simplified cost of influencer numbers can be somewhat helpful and insightful, we always encourage folks to keep the context in mind. If you don’t ask yourself “what do these campaigns include?” the numbers can be misleading.
And so, before you look for info on influencer pricing, we want to provide you with a list of key factors that make up these rates.
KEY FACTORS BEHIND INFLUENCER PRICING
1. Channel analytics
While two channels could have the same amount of subscribers, one might only see 10% of that audience regularly engaging while the other has 60% engagement. It’s similar to an email list. While the size of a list is interesting, the number of people who open and click on the emails regularly is far more meaningful.
2. Special usage rights
The most common usage request we see from brands is for usage in influencer paid social. When a brand is looking to use the creator's work or likeness in more places beyond the primary integration, you can expect the price to be impacted.
3. Brand exclusivity
Put simply, brand exclusivity is when a brand asks the creator to turn down sponsorship opportunities from other brands or brands in a particular niche for a specific window of time. The type of brand often dictates whether this is even a concern. For example, a creator may not be likely to promote two different insurance companies close together (low risk) but that might not be the case with an apparel brand (high risk).
4. Market demand
This is fairly straightforward. When brands show significant interest in a particular influencer, group of influencers, or niche, those prices will increase for as long as there is demand.
5. Production complexity
Is the integration simple and straightforward? Are there any unique requests? Will the creator need to bring in help to complete the project? The more involved a sponsorship gets beyond standard effort, the more the price may increase.
6. Sponsorship deliverables
While YouTube typically has fewer deliverables (a short integration or a full video) other channels may lend themselves to more individual deliverables. Is it an Instagram campaign? Maybe a brand is looking for some combination of Reels, Stories, and/or static posts. Either way, without knowing the deliverables, it’s unclear what the cost is likely to be.
7. Product appeal
Is the product particularly appealing or unappealing? For example, a rate might change based on whether the creator is being asked to promote a popular meal kit service versus a supplement for erectile dysfunction. The more tricky it might be to promote, the more it can affect the price.
8. Brand preference
Occasionally, a brand will approach a creator that they specifically want to work with because they know somebody who is a fan of that particular creator. In these instances, they often end up paying a premium. Additionally, this can lead to misleading pricing numbers as it’s not really driven by true market demand.
9. Historic data and performance
As an agency, we have seen it all. Creators with modest but extremely loyal audiences that will purchase in a heartbeat and giant creators that drive almost no results. At the end of the day, we’ve found that the best indicator of future performance is historic performance and when a creator knows that their audience will take action, it can lead to paying for that performance.
LOOKING FORWARD WITH MORE CONTEXT
So there you have it.
I hope this helps you look at influencer pricing a little differently in the future.
Can those numbers be helpful? Sure.
But I hope that looking at them with this additional context will help you make smarter decisions with your campaigns.
Need help with your influencer marketing? Schedule a 15-minute consultation to see if influencer is right for you.