Since 2019, the global influencer market has more than doubled, and that growth doesn’t look to be slowing down. Why? Because a well-placed, authentic endorsement from a trusted influencer cuts through the noise of an online landscape saturated with ads.
As more and more brands realize the power of influencer marketing, the answer to how to optimize those partnerships remains elusive. By learning the value of your partnerships and integrations, you can save a lot of money. Our Influencer Marketing program has saved our clients XX while boosting conversions) while still compensating our partners for their hard work. Here are the strategies we use to get the most value from successful influencer marketing campaigns.
Where to Start: Budget & Goals
Before you start negotiating, there are two main things you need to determine: your budget and your goals.
Knowing your budget will help you be realistic about prospecting potential influencers to work with. Only have $10,000 to spend? Maybe don’t try and hit-up Kylie Jenner or Cristiano Ronaldo. The good news here is that much smaller influencers have been shown to be incredibly powerful for brands.
Knowing your goals (are you trying to bring awareness to your brand or get people to buy your product?) will help you determine whether particular influencers are successful for you.
How Much Should You Be Paying?
The influencer marketing industry is famous for its lack of transparency in pay. This reality makes it difficult to know if a requested rate is reasonable – not just for the brand seeking partnership but also for influencers themselves!
One of the reasons why it is difficult to find transparent rates for influencers is that so many factors play into what an influencer is worth. Influencer Marketing Hub neatly summarized some of the factors at play:
- The influencer’s reach and engagement
- The channel they use
- How many posts do you want, and if they include things like images, videos, and audio
- How much effort will it require from the influencer
- Where the ad will be promoted/cross-posted
- Agency fees (if the influencer is represented by a manager)
Additionally, while there have been some efforts for small communities of influencers to share their pay, there still isn’t a comprehensive data set on exactly how much influencers make per post.
Because of this, we recommend you start recording what you pay influencers to have a data set as a point of reference.
How We Do This
Here at Portent, we use simple tables to track how much we pay influencers per post.
First, we create a table for each platform we have influencers on. In the first column of the table, we have ranges set for how we choose to categorize the influencers. For YouTube, our primary metric is “Views,” whereas, for Instagram and Twitter, the primary metric is “Followers.”
In the following columns, we input the prices we pay for various integrations. As you’ll see below, if you only sponsor one type of video on YouTube, you only need to have one column. If on Instagram you have various types of requirements, you can create a column for each type.
|Average Views (over videos from the past 3 months)||Price Range|
|0 – 5,000||X – X – X|
|5,001 – 10,000||X – X – X – X|
|10,001 – 25,000||X – X|
|Followers||Price Range for Permanent Post||Price Range for Permanent Reel + 3 Stories|
|0 – 5,000||X – X – X|
|5,001 – 10,000||X – X – X – X||X – X|
|10,001 – 25,000||X – X||X|
This table is for your reference, so you can make it as detailed or as general as you need. In the beginning, this table won’t be very helpful in helping you gauge what prices are reasonable. However, over time you’ll get enough information to help you better as you negotiate rates with new influencers.
Best Practices for Negotiating Rates
With influencers, their product is, well, themselves! Discussions about pay and fair rates can often be sensitive since under-valuing them can be perceived as a direct insult, and delighting them with a fair price for their work can really enhance and strengthen your relationship. Talks about payment and rates require tact from the get-go.. Here are some best practices for discussing this sensitively and maintaining a good relationship while discussing rates with a potential influencer partner.
Ask for Their Rates First
Once you’ve connected with an influencer with whom your product resonates, we recommend asking the influencer what their rate is for one integration and their discounted rate for multiple integrations. This might look something like this:
We’re so happy that our product aligns with your brand and is something
your audience would get value from! Could you please share what your
rate is for a single integration and what your discounted rate
for 3 integrations would be?
Asking for their rates first gives you a sense of what an influencer expects and helps you avoid offending them by lowballing them right out of the gate.
Asking for a discounted rate for multiple integrations also has a few benefits. First, it signals to an influencer that you’re open to an ongoing, mutually-beneficial partnership with them. Influencers’ income can vary widely month-to-month, so offering multiple integrations offers them more stability than just a one-off sponsorship.
Secondly, asking for a discounted rate for multiple integrations implies that this is what you expect if you’re going to enter into a longer relationship. Most influencers offer this freely, so it’s not unexpected!
Once you’ve received the influencer’s initial rates, you’ll want to do a few things. First, look at your budget, and see where their rates fall. Then, look at what you have paid similar influencers in the past (average monthly views, followers, engagement rates, subject matter, etc). This will help you understand if what the influencer is asking is reasonable.
Always keep in mind that a happy influencer who feels valued and well-compensated for their work will often become an amazing evangelist for your brand. And you certainly don’t want the opposite happening. Countering is expected among experienced influencers, and it can be done fairly, sensitively, and kindly.
Four basic scenarios will affect how you counter.
Scenario One: Their Proposal Is Above Your Expectations or Budget
In this scenario, the proposed rate is higher than what your budget allows or what you’ve paid influencers with similar stats. Across the board, we recommend that if you cannot afford to pay an influencer within 25% of their original offer, politely decline their offer. More on this later.
If you have historical information on what you’ve paid similar channels in the past, or at least have a general idea about what value this particular influencer has for your brand, provide a counter no lower than 25% of their original asking price. When doing this, be sure to give context to the influencer. This might look something like this:
Thank you so much for sharing – at this time, our budget would allow
us to pay XX for 1 integration or XX for 3 integrations.
Speaking in terms of your budget depersonalizes the offer and provides a sense of boundaries with the influencer. While you may have looked at what you’ve paid other influencers of a similar caliber, you don’t want to speak in terms of comparing them to others.
Determining the value of an influencer is a complex task, and no two influencers are the same. Telling an influencer that you don’t want to pay them what they think they’re worth based on what you’ve paid other influencers is much more likely to rub them the wrong way (and isn’t entirely accurate, either, since so much is involved when considering value).
Scenario Two: Their Proposal Is Within Your Expectations or Budget
In this scenario, the proposed rate falls within or below your budget and aligns with what you’ve paid influencers with similar stats. The rules for countering in this scenario are all the same as in scenario one. The difference is that you can start your counter knowing that at the end of the day, it is very likely that you will be able to begin a relationship with this influencer.
While the proposed rate may be in the same range you’ve paid similar influencers in the past, it’s important to remember that every influencer is different, and you still don’t know how this influencer will perform for your brand. For this reason, it’s better to test at a lower rate. We suggest countering slightly lower, letting the influencer know that if things perform well, you’d be open to renegotiating rates down the line.
We suggest something like this:
Thank you for providing your rates. At this time, we can offer XX
for one integration or XX for three. If these ads perform well
for us, we are more than willing to renegotiate down the
road, but for this initial test, this is all our budget allows.
Scenario Three: Their Proposal Is Below Your Expectations or Budget
We know this post is about negotiation, but sometimes you might receive a proposed rate below what you had budgeted for and maybe less than what you’ve paid in the past for a similar-sized influencer. In this case, we suggest accepting the given rate. This can be an excellent opportunity to see how an influencer performs; if they’re successful for your brand, there will be opportunities to negotiate down the line and compensate higher if you continue working together.
Scenario Four: When an Influencer Doesn’t Ask for Enough
Occasionally you will come across a situation where the influencer is asking way too little for their integrations. It doesn’t happen often, but sometimes a micro-influencer who hasn’t been doing integrations for very long will ask a lot less than their channel deserves.
It may be tempting to pursue a contract at this price, to increase your profitability, but you could also see this as an opportunity to create a lifetime relationship for the brand. Oftentimes, offering a little more than they’ve asked communicates appreciation for their work, and an influencer that feels valued might just become the best evangelist for your brand that you have.
This is something to consider when evaluating the value of any level of compensation for one of your influencer partnerships.
Turning Down a Partnership
So you’ve provided a counter, and the influencer is not able or willing to work within your budget. That’s ok! Here’s what politely declining might look like:
Thank you for getting back to us with that offer. Currently, our budget
does not allow us to pay that much for an integration. While we cannot
enter into a partnership at this time, we will reach out if anything
changes! We admire your work and wish you good luck with your endeavors.
Again, phrasing things in terms of your budget signals that the decision is not personal, and letting them know that you will reach out if anything changes signals that you recognize their value and keeps the door open for a future relationship
Negotiating with influencers might seem intimidating or complicated. Still, with these best practices, you will set yourself up for success by ensuring that you pay fairly and optimize your spending.
Finally, don’t forget to track how much your negotiations save you! For example, since 2019, Portent has saved our clients over $565,936 through negotiations for one client, driving over 77,000 conversions that made up more than 42% of the client’s entire sales volume.
This is not a number you want to leave uncelebrated! Demonstrating how much money you save through your savvy negotiation skills, along with reporting all your success metrics, will prove invaluable when justifying your influencer efforts.