Money Talks

When influencer marketing first burst onto the scene, brands and social media influencers were still testing the waters of their relationships. No one had a firm idea of how influencer campaigns, as a marketing practice, would evolve. In the beginning, the relationship was largely based on mutual benefits. Influencers would post positive reviews and statements about brand products, and brands would compensate them for their positive sentiments with free products and gifts. Additionally, partnerships with brands also helped influencers grow their digital authorities.  For years, this symbiotic relationship worked for both parties. However, as blogging evolved from hobbies to full-time businesses for many influencers, the gift-exchange model became outdated. Competition also contributed to this shift. Over the years, more and more brands have begun to cultivate relationships with digital influencers because they’ve seen the effect these individuals can have on buying decisions and brand loyalties among mass audiences. With increasing numbers of brands requesting sponsored posts and reviews, influencers became more aware of just how valuable they were to brands’ online identities. Over the years, brands have increasingly depended on influencers to bridge the gap with consumers, and influencers, rightfully so, have increasingly demanded adequate compensation for their efforts and value.

One of the biggest challenges facing influencer marketing is that there are still no rules – many refer to the landscape as the Wild West. Brands and digital influencers, alike, are still experimenting to figure out what works best for them and their audiences. In many respects, the newness of influencer marketing is what makes it so exhilarating. But a few headaches often accompany novelty. Without universal standards and guidelines, there are still differing points of view when it comes to money.

Because of influencer marketing’s origins, some brands still believe that gifts and product exchanges substitute money as adequate payments. However, if brands hold on to this old-fashioned way of thinking, they will find themselves struggling to retain valuable influencer relationships. Influencer marketing is a pay-to-play space and it’s much more productive to embrace that reality than to try to fight against it.

A recent eMarketer study, Influencer Marketing for U.S. Brands: The Platforms to Watch and the Best Ways to Work with Creators, revealed that nearly 70% of influencers prefer monetary compensation to free products, ads and affiliate partnerships. This overwhelming majority opinion signifies that monetary compensation is here to stay. One way brands can begin to adapt to this compensation model, is to try to shift the way that they view influencers. Years ago, influencers were merely people who created digital content for audiences, in some cases, glorified customers. Now, influencers are their own media entities. Brand marketers need to recognize them on this level in order to begin cultivating transparent relationships.



Once brands come around to the fact that influencers must be paid, they must then try to reconcile with individual influencer rates, which are often, inconsistent at best. The inconsistency stems from the fact that there is still not a metrics standard. Some believe that reach rules, and therefore, the amount of followers an influencer has should determine posting rates. Others are coming around to the notion that reach may not always be worth it. For example,  some influencers with hundred of thousands of followers receive very little engagement on their posts. If an influencer’s posts consistently do not receive engagement, it’s usually an indication that the content is not resonating with the audience — perhaps the content is of low quality or the subject matter is completely unrelated to the demographics’ interests and characteristics. In this case, the high reach of the influencer is somewhat obsolete because the audience does not seem to care or pay attention to the content that is being posted.

Alternatively, engagement can be a very good indicator into whether or not an influencer’s posting rates are accurate reflections of their post’s worth. Consistently high engagement means that regardless of the audience size, the influencer’s content grabs the attention spans and resonates with followers. Even if the audience pool is on the smaller size, an influencer with high engagement rate likely means he or she is delivering  high quality audience members who are involved and deeply interested in what the influencer has to say. At the end of the day, brands want to spend their time trying to get in front of audiences who care about their niche, voice and products and engagement is a metric that can testify whether or not an influencer can deliver on those fronts.



To spend wisely and set a campaign up for success, it’s important that brand marketers take the time to look into each potential influencers’ metrics, specifically engagement, before conducting outreach and rate negotiations. Understand an influencer’s metrics will help brand marketers determine best fit, as well as whether or not an influencer’s asking rate is on par with potential value.



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