Is Influencer Marketing Expensive?
Influencer marketing has become an increasingly popular way for brands to reach consumers. But how much does it cost? And what are the best practices when using influencers?
Why Influencer Marketing Works?
Influencer marketing works because consumers trust other people more than they trust companies. Consumers believe that others will share their opinions and experiences with them. They also believe that these people will act responsibly and not sell out their brand. Brands use influencers to build relationships with their customers by sharing their stories and providing advice. The problem is many brands are using the wrong type of influencers for their campaigns. The wrong influencer can hurt your brand’s reputation. In this post, we’ll discuss why you should avoid certain types of influencers when it comes to your brand’s social media strategy. We’ll also provide some tips on how to find the right influencer for your campaign and how to budget accordingly such that influencer marketing ends up being less expensive than traditional marketing.
Where to Find Influencers?
You can find influencers through social media networks, online directories, and even by searching Google. If you're looking for an influencer who has a large following, you might consider starting with a smaller network and then moving up as your business grows.
There are many ways to find influencers. The most common method is to search for them on social media sites such as Facebook, Instagram, Twitter, YouTube, and Pinterest. Another option is to use online directories. These include sites like Dofollowers, Topsy, and Social Media Examiner. A third option is to look at blogs and websites that cover topics related to your industry. For example, if you sell dog toys, you could check out pet blog sites like BarkBox Reviews, Dog Blog Review, and Pet Product Reviews. Obviously, you can search Google for influencers in your niche.
All those methods are free ways to find influencers, and, by definition, are inexpensive. If you’re just starting out with influencers and getting your toes wet these are all perfectly acceptable methods. If you’re looking to scale your influencer marketing program it makes sense to use a platform to find your influencers.
With Smartfluence, you can search through a database of carefully curated influencers on TikTok and YouTube, accessing millions of influencers by filtering for demographics like age, gender, ethnicity, and location, influencer characteristics like follower count, engagement rates, and follower growth. What’s more, if you’re looking for Instagram influencers in particular, Smartfluence’s highly trained team of specialists will find you your ideal influencers based on the above factors but will also go above and beyond by even looking for influencers who have worked with similar brands in the past or find influencers whose audience demonstrate a strong connection with brands whose audiences you want to emulate.
By using a platform, you typically will incur a monthly fee, but you’ll end up finding much more targeted results, and streamline your influencer marketing process by handling your search, messaging, tracking, and payment, all in one platform, ultimately saving you time and money, making it an inexpensive proposition.
How to Choose an Influencer
There are several ways to choose an influencer. First, you need to decide what your primary marketing objectives are for your influencer marketing campaign. You’ll also need to determine the key metrics you’re looking for on both a performance basis and audience basis, depending on your objective. Then, you need to determine how much money you want to spend and how you will compensate your influencer. Finally, you need to figure out what kind of relationship you want to build with the influencer.
The primary objectives most marketers optimize around when creating an influencer marketing campaign are awareness, engagement, content, and sales. Different influencers are better at different objectives. Analyzing the results of hundreds of clients, we have noticed that larger influencers tend to perform better for awareness and engagement, while smaller influencers perform better for sales, and mid-size influencers performing better for content creation. Considering prices vary significantly within each bracket of influencer ranging from nano influencer to celebrity, it would be impossible to determine a budget without first figuring out what type of influencer you’re using based on what your objective is.
Once you’ve decided what your objective is, you’ll have to figure out which influencer is a good fit. At this point, you’ll already know what size of influencer to use. But does their audience matter to you as well? If you’re solely looking for content, it probably doesn’t matter. But if you’re optimizing around any of the other three major objectives, it does not get more important than figuring out what audience your influencer has. This means looking at their demographics at the very minimum and analyzing their brand affinities if you want to be sophisticated.
You’ll then have to determine an overall budget – likely based on what time of relationship you’re looking to build with the influencer. Are you looking to have each influencer post for you just once? Are you looking to make them an ambassador? What about making them an affiliate? Are you putting your influencers on a retainer? These are all questions you need to answer before determining your budget. On a platform like Smartfluence, you can choose to pay your influencers in the form of cash via PayPal, product, affiliate commission via one of our multiple integrations, or a combination of the above.
How Much Does Influencer Marketing Cost?
Influencer marketing costs vary based on the size of the brand, the number of influencers involved, influencer size, and how much each influencer gets paid. Our clients typically spend between $1,000 and $100,000 per campaign. However, some companies spend well over $1 million per campaign. As you can see, that’s a wide range to say the least.
At an individual level, we find nano influencers, and micro influencers to an extent, are happy to post in exchange for products or services if they are genuinely interested in them. This typically caps out at 25K followers unless you’re lucky and can go higher. Beyond that, there are general pricing guidelines you can follow when determining what to pay an influencer. That said, a platform like Smartfluence shows suggested pricing for every influencer based on our own algorithms.
At a base level, on Instagram you can expect to pay influencers an average of $0.20 to $0.30 per average engagement if they’re on the smaller side, and around $0.01 per follower if they’re larger. As an example, an influencer with 10,000 followers getting 500 likes on a post should be worth anywhere from $100 to $150 per post. An influencer with a million followers would be worth around $10,000 per post.
TikTok and YouTube, however, will cost you significantly more. This is due to the viral nature of the platforms, where it’s more about video views rather than follower count. As a result, costs can be 3 to 5 times as high for similar sized accounts on those platforms.
So, Is Influencer Marketing Expensive?
As you can see, there is a very wide range when it comes to influencer size, type, and compensation. The most effective way to answer the question about the value of influencer marketing is to compare it to traditional marketing, rather than looking at the absolute dollar amount to get started (which we’ve already shown can be quite low). Simply keep track of your cost per thousand impressions, or CPM. By comparing your CPM from your paid ads to the CPM of your influencer posts, you’ll be able to distinguish between an influencer being expensive and being pricey. Often, influencer posts end up being significantly cheaper than traditional paid advertising channels, due to content being more relatable, trustworthy, and free from volatile auction prices that are seen in traditional paid social efforts.
If you’re interested in learning more about influencer marketing and how Smartfluence can help you establish and scale your influencer marketing campaigns, feel free to book a demo here.