It’s no secret that influencer marketing is taking the world of digital marketing by storm. To help small business take advantage of this marketing opportunity, we recently discussed the proper way to approach and evaluate influencer marketing.
Let’s focus on the biggest question companies have when trying influencer marketing: How much is this going to cost me?
What Is Influencer Marketing?
Sweet Rose Studios broke down exactly what influencer marketing is here but in a nutshell, influencer marketing is a form of social media marketing where companies find people with strong followings – or “influence” – and pay them to endorse their product to their audience.
What Platform Should I Focus On?
Influencer marketing can be found on all popular social media platforms, ranging from YouTube to Snapchat – but Instagram is typically the go-to for companies when choosing a platform to promote on. This is simply because Instagram influencer partnerships have proven to be the most effective out of all platforms.
What makes Instagram so special?
Its users have an average 3.2% engagement rate while other platform’s users hold about a 1.5% engagement rate. This allows Instagram to dominate in allowing companies to reach new audiences through influencers.
How Much Should I Spend On An Influencer?
Now that you know what influencer marketing is and which platform to work with them on, it’s time for the big question: How much should I be spending? It can be a daunting question with plenty of costly variables.
The Golden Rule
The typical starting rate for influencer marketing is one cent per follow, which comes out to be about $100 per 10K followers.
Ignite Visibility found that the overall average price for Instagram sponsorships was about $270 per post. Micro-influencers, who have less than 1,000 followers typically charged $83 per post while macro-influencers with over 100,000 charged an average $763 per post.
According to Matt Crump, an Instagram influencer with over 257,000 followers, Instagram stories are usually part of a package deal – or included to sweeten the deal for the brand.
If you are worried about those costly posts with big-name influencers, don’t worry!
Micro-influencers typically have a higher engagement rate than macro-influencers and therefore will not only cost less, but provide you with a higher return on investment (ROI) since you are spending less to gain the attention of a more responsive audience.
Accounts under 50,000 followers are great for small businesses looking to venture out into influencer marketing, while larger companies may be able to spend big bucks on high-level influencers.
While one cent per follow may sound fairly straight forward, there are many variables that go into the rates of influencers, which is what causes prices to vary. Here are some of the common variables influencers consider when coming up with sponsorship rates:
- Their engagement rate.
- How well the sponsored company fits with their brand.
- The total number of posts the company is requesting.
- The type of post it is – Videos will most likely cost more than a photo.
- Is production involved? If the influencer has to hire a photographer, videographer, editor, etc., they will include this in their rate.
Basically, this is how to calculate the cost of an influencer: $100 x 10,000 followers + extras = total rate
Real Influencer Rate Examples
Recently this year, Later provided real examples of influencer packages in 2019. They reached out to a handful of influencers with various follower counts to gather a true scope of how followers can impact price. Here are some of the results:
Mid-Tier-Influencer Example Rates
Type of influencer: Lifestyle
Follow count: 170K
Engagement Rate: 4.5%
$1000 per Instagram Post
$500 per Sponsored Giveaway
Micro-Influencer Example Rates
Type of influencer: Health and Nutrition
Follower count: 30K followers
Engagement rate: 7.3%
$325 per Instagram Post
$350 per Instagram Giveaway
$85 for a series of 5 Instagram Stories
Being such a new avenue of marketing, influencer marketing can come off as complex and unpredictable. The good news is, while you may not be able to pay $250,000 for a Kim Kardashian sponsored post, there are plenty of opportunities for your small business to thrive with this style of marketing.
Choosing the right influencer will bring you closer to your niche community, cost you less money, and boost those sought-after conversions!