Creating an influencer marketing budget can be a daunting prospect for many businesses, especially those just starting out or in their first years of operation. With the ever-changing landscape of digital marketing, it’s important to have a plan and budget in place to ensure the best possible return on your investment. Influencer marketing is a powerful tool for businesses of any size and (almost) any industry. Understanding how to create a budget for this medium is essential for long-term success.
This blog post will provide a comprehensive guide to creating an influencer marketing budget and explain why it is so important for businesses of all sizes. We will discuss the different types of influencers and the different costs associated with each one, as well as the specific ways to measure the success of an influencer marketing campaign. By the end, you will have a better understanding of how to create an effective, successful influencer marketing budget that works for your business.
An influencer marketing budget is a set amount of money that you allocate to your influencer marketing activities. This budget can be used to pay influencers for their posts, content, or promotion of your brand. It can also be used to cover other associated costs, such as software or tools, travel, or events. All these costs need to be accounted for, otherwise you’ll end up paying more than you initially intended.
An influencer marketing budget should be based on your overall marketing budget and objectives. You’ll want to consider how much you can afford to spend and what kind of return on investment you expect to see. You’ll also need to decide which influencers are the best fit for your brand and campaign.
Once you’ve determined your budget and objectives, you can start reaching out to influencers and negotiating deals. Remember to keep track of your spending and results so you can adjust your budget and objectives as needed.
An influencer marketing budget is important because it allows you to track your spending and ensure that you are getting a return on your investment. Without a budget, it is difficult to know how much you are spending on your campaign, and whether or not that spending is resulting in any sales, leads or relevant awareness. A budget also allows you to set a limit on your spending, so that you don’t overspend on your campaign.
An influencer marketing budget is crucial, as it allows you to work with influencers who fit your budget. There are a variety of influencers out there, and each one has a different price tag. We’ll see how to assess the size and quality of influencers later in this article.
It’s worth noting that results generated for other brands might not necessarily be an indicator of the results you would expect to get from the same influencer. Brands are each their own, content will be distinct, timing will differ. To get a good indication of results, you’ll need to test the waters first and see how your first collaborations end up. This will also help you understand influencers followers’ reactions to your brand, products and services.
The first step in creating a budget for influencer marketing is to assess your current budget. This means taking a hard look at your current resources and understanding how much money you have available to spend on influencer marketing. This may require you to crunch some numbers and look at your current expenses, but it will give you a better idea of how much money you can realistically allocate to influencer marketing. Once you have an understanding of your current budget, you can start to create an influencer marketing budget that works for your business.
Look at the various channels you currently invest in. Is it mainly Google Ads? Is it both Google and Facebook Ads? Is it programmatic marketing? Take into consideration the fact that influencer marketing is not a quick process. It pays off to dedicate resources and time to create relationships with influencers and repurpose the content you get from collaborations. To spread the content throughout your social channels and ad platforms. After you’ve done all of this you can truly assess the impact of a collaboration.
The next step is to determine how much money you want to allocate toward influencer marketing. This can be complex since you want to make sure you are spending enough money to get the best results, but also not overspending and wasting resources. Once you have decided on a budget, you need to look into which influencers you want to target and what platforms they use. You may also want to consider the demographics of the influencers you are targeting and whether they are a good fit for your campaign. Additionally, you should consider the cost per engagement and whether or not it is within your budget. Finally, you need to look into the different types of campaigns that you can run and decide which one is the best fit for your budget.
How much you should spend on influencer marketing will depend on your overall marketing budget, as well as your goals for the campaign. Oberlo estimates that influencer marketing spending will only increase in 2023, by about 12%. Marketers’ confidence remains high, so you should realize that this can become a performance channel, if you use it wisely.
If you have a large marketing budget, you may want to allocate a significant portion of it to your first influencer marketing campaigns. Jump right in and test the waters in a significant way.
If you have a smaller budget, you should be more cautious, begin with a smaller campaign and scale it up over time. It is also important to consider your goals for the campaign when deciding how much to spend. If you are hoping to generate a lot of leads, you may want to spend more on your campaign than if you are simply hoping to increase brand awareness. Also think about the post-campaign period, how you’ll use the generated content and integrate the influencer campaign within the larger marketing strategy.
Some brands choose to work with individual influencers they trust or are recommended, while others work with multiple influencers. There are pros and cons to both approaches. Working with a single influencer can be more expensive (if it’s a mega-influencer or celebrity), but it can also be more effective in terms of reaching your target audience. Working with multiple influencers can be less expensive, but it may be more difficult to track results and ensure that each influencer is effectively reaching your target audience. That is, unless you’re using a dedicated Influencer Marketing Platform such as Flaminjoy
A large number of influencers (nano- and micro-) ensures you get a variety of content pieces, as well as different communities to test your product offering. It also ensures a wider reach among a very engaged audience. Smaller influencers have 3X-5X higher engagement rates than their larger counterparts, according to Phlanx.
After you’ve identified the influencers that you’d like to work with, it’s time to research their fees. To get an accurate picture of what you’ll be paying, research what influencers in your industry typically charge and use that as your starting point. You can also look at the influencer’s past campaigns to get a better idea of their pricing.
Influencer fees can vary greatly and depend on several factors, including their reach and the scope of the project. Prices can range anywhere from hundreds to thousands of dollars. To get a better idea of what you’ll be paying, you’ll need to contact them or reach out to other brands that have already collaborated with them. Keep in mind that influencers may be willing to negotiate, so be sure to shop around to get the best deal. If you’re a small brand, think about the option of product sampling or barter collaboration. This requires you to provide products for the influencers, while they share their opinions, reviews or unboxings on social media. This tactic could prove to be more financially sound, as you already know the cost of your products as well as shipping. Which can help you achieve cost predictability.
Finally, be sure to factor in any additional costs that may be associated with the campaign:
Your budget will naturally dictate the number of influencers you work with during a campaign. At the same time, it influences the influencer size. And the number of posts per collaboration.
Note that not all post types are created equal. A single image is, in theory, simpler to create than a carousel full of pictures. Which is simpler than a Reel, which requires specific settings, storytelling, music, editing and the right duration to hook viewers in, from the first 2-3 seconds. This means that videos will tend to cost more, as long as they’re not basic one-shot unboxings.
When it comes to smaller, nano- and micro-influencers costs can vary from $50 to $250 per post and/or story. Then macro-influencers increase that number: $150 – $750. The next category can be seen as mega-influencers and celebrities. Depending on the niche and follower size, you could easily be looking at a few thousand for a single post. These are estimates and will differ depending on your geographic location, influencer reputation and time of the year.
It’s reported that Kim Kardashian was paid over 1 Million Dollars for a single post, while models and other influencers with large followings can easily change hundreds of thousands. It depends on what you want to achieve and how much you’re looking to spend.
According to Influencer Marketing Hub, product sampling and cash payments are not the only types of rewards for influencers. Over 68% contains these 2 elements, but a quarter is made up of discounts that can be used on products and services. The advanced way of this strategy is to provide promo codes for influencers to use, but also personalized codes they can share with their followers.
In this scenario, influencers will be incentivized to share their discount promo codes, as you can set up an affiliate deal with them. When you make money, they make money. They will gain more benefits if they understand your tactics and the entire collaboration context.
With all this in mind, prices shouldn’t be your main focus. You should be looking at influencer marketing as an investment. As a set of actions within a larger marketing strategy.
Planning your budget for an influencer marketing collaboration should always take into consideration the expected results. Sure, Kim Kardashian’s 1 Million Dollars seems like an impossible number for smaller brands. But what are the expectations in terms of results? If the ROI is 2X-5X or even 10X, then the costs should be categorized as an investment.
The biggest mistake is seeing the influencer collaboration as a separate, individual piece. Not as a part of a larger plan. Think of it this way: if you own an ecommerce store, there is a 99% chance you’re using product shots that feature products on white backgrounds. The traditional images we’ve been accustomed to. But what if the content from influencers featuring lifestyle shots, featuring benefits, could be a great replacement for those standard images?
What if influencer content drove conversions up, long-term, post-campaign? Would you still consider influencer campaigns as a “one-off” or a “test”?
Carefully consider the entire scope of your collaboration, as it relates to the larger digital marketing plan. This will ensure you’re looking through the right lens and analyzing the return on investment at a macro level.
When allocating your influencer marketing budget, you will need to consider a few factors, such as your overall budget, your goals for the campaign, and the size of your target audience. You will also need to decide how many influencers you want to work with, and what type of content they will be creating. Once you have considered all of these factors, you can start to allocate your budget to different aspects of your campaign.
For example, you may want to allocate a certain amount of your budget (or resources) to influencer outreach, to ensure that you are working with the right influencers for your brand. You may also want to allocate a portion of your budget to content creation, to be sure that the influencers are creating high-quality content that will resonate with your target audience. Finally, another portion of your budget should remain for promotion, so that your campaign is reaching as many people as possible.
Here is a sample allocation:
Note that your allocation may differ. If you see an influencer post going viral or the link associated with it driving significant results, consider increasing your content promotion sum, to increase your ROI even more.
There are many benefits to having an influencer marketing budget. Perhaps the most obvious benefit is that it allows you to track your spending and ensure that you are getting a return on your investment. A budget also allows you to set a limit on your spending, so that you don’t overspend on your campaign. Additionally, a budget can help you to plan and organize your campaign, and to allocate your resources in the most effective way possible.
Another benefit of having an influencer marketing budget is that it can help you to negotiate better rates with influencers. If you have a set budget for your campaign, you can use this as leverage when talking to influencers. This can help you get better value for your money, and ensure that your campaign is as cost-effective as possible.
Finally, having an influencer marketing budget can also help you to measure the success of your campaign. By tracking your spending and measuring your results (remember: long-term, not just immediately after the collaboration), you can get a better understanding of what is working and what is not. This information can then be used to adjust your campaign accordingly, so that you are getting the most out of your influencer marketing budget.
This helps you see the larger scope of an influencer campaign and the multiple benefits it provides for your brand and your awareness.
There are a few disadvantages to not having an influencer marketing budget. First, it can be difficult to track your spending and ensure that you are getting a return on your investment without a budget. Additionally, without a budget, it is easy to overspend on your campaign. Finally, a lack of budget can make it difficult to plan and organize your campaign effectively.
Not having a budget can also limit the scope of your campaign. Without a budget, you may not be able to reach as many influencers or have as much impact on your target audience. Additionally, a smaller budget can also make it difficult to negotiate favorable terms with influencers. As a result, not having a budget for your influencer marketing campaign can ultimately lead to a less successful campaign.
Great influencer marketing platforms, such as Flaminjoy, provide an easy way of understanding influencer performance, before you start a collaboration. You have access to real-time updated information on:
With these pieces of information, you can confidently create a strategy that puts data first and allows you to predictably plan for the future.
When creating an influencer marketing budget, it is important to track and analyze the results of your campaigns. This will enable you to determine the ROI of your efforts and adjust your spending if necessary.
Common performance metrics to measure:
By analyzing the data, you can identify which influencers are driving the most engagement and impact. You can also track the performance of different campaigns and compare them against each other.. This will help you maximize your influencer marketing budget and get the most out of each campaign.
Always remember the value of content. If you negotiate a deal where you can safely use the influencer content in your marketing – on your website (in Shoppable Galleries), in social-media and in ads – your overall ROI will be higher in the long run, if you simply look at metrics for individual pieces of content. You would do the influencers and yourself a disservice if you look at data just from a microscopic perspective and only immediately after the campaign has ended.
Influencer marketing is an investment and should be seen as going to the gym: you can go once or twice and notice you’re not getting any more muscular or losing any weight. And blame it on the gym, the exercises or the equipment. What you must do is take it one day at a time, focus on your overall progress and give it 3-6 months, with the right mindset and overall support to have a higher chance of reaching your goals.
In conclusion, creating an influencer marketing budget is an important part of a successful influencer marketing campaign. You must research and identify the right influencers, determine how much you are willing to pay them, and then create a budget that will cover the costs associated with the campaign. Setting the right expectations and focusing on results at a macro level reveals the entire benefit spectrum of such a collaboration. By creating a flexible, well-thought-out budget, you will be able to ensure that your influencer marketing campaign is successful and profitable.
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