How to plan an influencer marketing budget
Influencer marketing has become an almost traditional part of promotional strategy. Companies from a wide range of sectors are enlisting the help of influencers to increase their visibility. For such collaborations to be successful, it is important to plan the budget for influencer marketing properly.
There are several factors to consider when budgeting for this type of promotion. It is necessary to analyse the cost of the software and the advertising campaign and the cost of paying for the influencer’s services. Budget planning also includes:
– the number of bloggers involved;
– preferred types of influencers;
– on which social media platforms the work will take place;
– the method of remuneration.
Market research shows that the cost of influencer marketing is increasing regularly. For example, the figure in the US was USD 4.62 billion in 2023. The amount spent on working with bloggers depends on the size of the company and its specifics. According to surveys, 67% of companies spend less than USD 50,000 annually on this type of promotion.
Return on investment in marketing depends on the right tool. In this case, it is the influencer. Once the specialist has chosen the right influencer, offering them favourable terms of cooperation is necessary. To do this, you must create a value proposition that interests the blogger. It should be attractive to the influencer and not bankrupt the business. A good option can be various incentives and rewards, including:
– free provision of company services;
– exclusive access to new products;
– participation in events;
– official recognition of the relationship, such as a company logo on the website.
The main objective of any marketing strategy is to increase sales with a high return on investment. At the same time, it is essential to consider the risks affecting the budget.
Paying influencers
Outcome-based pricing is a popular model for working with influencers. In this case, payment for an influencer’s services depends on the number of new customers, conversions and other indicators.
Another option is revenue sharing. In this model, the influencer receives a percentage of each sale they are involved in. This is a partnership based on mutual interest.
The services of macro-influencers and celebrities are more expensive than those of nano- and micro-bloggers. In addition, the price of the collaboration depends on the product category and other aspects. Examples of one-off payments:
– the price of publishing a post on a nano-influencer’s page varies from USD 10 to USD 100;
– micro-influencers offer advertising in a post for USD 100-500;
– macro-influencer promotion costs USD 5,000 to USD 10,000 per post;
– working with mega-influencers costs around USD 10,000 per post.
Celebrities have much higher rates. Companies sometimes pay more than USD 1 million to advertise with celebrities.
When planning an influencer marketing budget, professionals should consider the cost of SMM. In addition, different social networks have their advertising costs. YouTube is regarded as the most expensive platform, with Instagram in second place, followed by TikTok.
