Influencer marketing offers enormous potential value to brands who leverage it as part of their marketing mix. Done right, it reaches a targeted audience through familiar voices. It brings authenticity to your marketing messages while building trust and credibility. But one potential hurdle repeatedly causes problems: the challenge of accurately valuing influencers and making sure your budgets get the biggest bang for their buck.

Accurately valuing influencers is both tricky and essential

How do you really know what an influencer is worth? How do you know if their fee is inflated, undercooked, or perfectly reflective of their place in the market? For too many people working with influencers, fees are the trickiest part of any agreement.

At its best, it can still often feel like a ‘best guess’ situation. At its worst, knowing if an agreed fee represents value for money can be like driving with a blindfold on: you have absolutely no idea if you’re on the right track.

Here’s the biggest issue causing this challenge: getting transparency over the data you need is incredibly difficult. Even agencies and brands that work regularly with influencers can struggle to justify influencer fees in clear, objective terms.

The result of all this uncertainty? For marketing directors and agency owners, the issue is consistent: you’re constantly risking inefficient campaign spend by overvaluing influencers and overestimating the results they can deliver.

If your business can crack the art of valuing influencers, you’ll be ahead of almost all your competitors. When it comes to influencer marketing, you’ll be seen as a true market leader. And you’ll be able to enjoy consistently better results from your influencer marketing campaigns.

Here’s how to do it:

The extra considerations needed for correct valuations

The fundamental item on your checklist should be an accurate source of truth for data you receive about influencers. If you’re asking an influencer directly to share details on their engagement rates and audience profile, you’re leaving yourself wide open to potential fraud.

Most influencers provide this data by logging into their social media accounts and sharing a screenshot from their phone. Of course, many will do this genuinely and in good faith. But we’ve also seen numerous examples of influencers manipulating the numbers of their screenshots to artificially inflate their value. Don’t leave yourself vulnerable to the same risk. A specialist influencer marketing platform is your only trusted option.

Next, you also need to have an understanding that valuing influencers is about more than follower count. The deeper and more nuanced your value matrix, the more likely you are to arrive at accurate market values for the influencers you’re working with.

We recommend you work through a five-tiered approach:

1. Follower count only. This is the most basic level. It’s rudimentary. It’s not particularly refined. But it’s a start.
   
   

2. Follower-to-accounts-followed ratio. Looking at this figure helps you to understand if your influencer has gathered a genuine audience, or if they’ve been using schemes to inflate their numbers without care for the nature of their audience.
   
   

3. Average likes, comments, engagement. If your influencer’s posts are consistently falling flat, this will significantly lower their potential results for your brand.
   
   

4. Post frequency. Some people see a highly active influencer and think they must be the right fit. But some accounts post 10 times a day. If your chosen influencer does that, within 24 hours of posting your ad you’ll already be way down their grid and disappearing from the algorithm. You need to find the right balance.
   
   

5. Remove anomalies. Don’t consider the results of any anomalous posts. If one post got 2,000 engagements but every other post received 10 engagements, the lower number is the more likely outcome for your post, too.
   
   

How you can use data to determine an influencer’s fee

The best way to arrive at a final fee for your influencer is to consider all of the five points above. Doing this helps to ensure you get maximum value for your budget and helps to minimise the chance of you dramatically overpaying.

Take some time to try to codify each of these five points previously mentioned. At a low level, perhaps if you’re hiring five or fewer influencers, you could try to produce a manual pricing matrix in Microsoft Excel. But, ultimately, that won’t last long. As soon as your influencer marketing campaign starts to scale to more than just a handful of influencers, you’re going to need outside help to accurately assess an influencer’s worth. Intelligent platforms like Sway Me Good are designed specifically for this purpose.

Does pricing even matter? Can’t I just gift products instead?

If you run a product-based business, you might be tempted to try to negotiate free products for your influencers instead of a cash payment.

There are definitely circumstances where gifting has some advantages over traditional payments. Equally, there are circumstances where payment is clearly the most desirable way forward.

The benefits and challenges of gifting

✅ If your product has a high unit cost, influencers are likely to agree to a gift-based payment because they know they can quickly re-sell your unit on platforms like eBay and convert it into cash.

✅ If you’re a huge, global brand, influencers might be more likely to take your gift because they want to use your product to drive visibility of their partnership with your company. Doing this can help them secure other influencer agreements.

✅ Finally, gifting is excellent if your product is already very well aligned with something the influencer likes. If you know the influencer is likely to buy your product even if they don’t work with you, a free gift of your product could prove very tempting for the influencer.

❌ With low-price products, it can be difficult for creators and influencers to feel that the gift value justifies the time or expense of content creation. This risks either rejected contract offers or low-standard, rushed work.

❌ Start-ups might not have the brand recognition an influencer can use to leverage other partnerships. If you’re in the early days of your development, don’t be surprised if an influencer demands cash.

❌ Ghosting is more likely when money is not involved. Unscrupulous influencers can feel less obligated to a brand who has only sent them a free gift rather than a traceable cash payment.

❌ With no cash changing hands, you may not have a binding delivery contract. This can potentially expose you to issues with content licensing going forward.

❌ Using gifting as a form of payment can invite a range of complicated tax issues. See our full compliance guide for more information.

The benefits and challenges of paying influencers

✅ If you build a relationship with an influencer early in their career, you may find that they do not raise their fee despite their growing audience. This ‘grandfathering’ effect helps you get even greater value further down the line.

✅ Using a fee rather than a product helps to formalise your agreement through a full contract, which also gives you more control over process, quality, licensing, and other contractual obligations. Money resolves lots of potential influencer marketing issues.

✅ When it comes to content creation and genuine influencer marketing, subtle and natural product placement works best. But this is a high-value skill. Many career-driven influencers view themselves as high-end professionals providing a valuable service. They will often only work on a cash basis.

❌ You may find your budget doesn’t go as far as you’d like, and your campaign is limited by your ability to fund it – especially if you haven’t followed a pricing framework of used a platform to establish accurate pricing/valuing of your influencers..

Which is better for influencer marketing: gifting or paying?

There’s no definitive answer to this question, but there is an answer that’s right more times than not. In general, paying should be your default mode of operation. Gifting works well in some circumstances. But most deals benefit from cash payments.

The benefits of accurately valuing influencers

If you can accurately value the influencers you work with, you’re much more likely to achieve consistently better results against your campaign objectives. You’ll also have more chance of avoiding unprofessional behaviour from the influencers you work with, minimising the likelihood of low engagement with the posts you commission, and steering clear of potential reputational damage that can arise from working with misaligned influencers.

Sway Me Good provides total price transparency on all its registered influencers. If you’re a brand or agency, you can use Sway Me Good to instantly find influencers, understand their key metrics, and view their price – no hassle, no haggling, and no uncertainty. Our independent valuation system assesses each influencer’s online clout and calculates a fair cost per post. All you’ve got to do is choose the authentic influencers you want.

Try Sway Me Good today and take your influencer marketing campaigns to the next level