* This post was last update August 10, 2018 *
This article is the first in a series of posts I’ll be sharing around the questions of cost, ROI and strategy. I want to address these pain points as they come up time and time again when brands and PR pros are getting started with influencer marketing.
If you go online and google “influencer marketing” there are loads of posts that talk about how great it is…and why you need to be doing it. Influencer marketing has been so useful for driving brand awareness and engagement that some marketers have even wondered if we’re witnessing a sort of “influencer marketing bubble” that’s bound to cave in on itself this year.
Still, six years after Instagram influencers first showed up on our radars, it’s still hard to find content that will give you in-depth strategies around this growing digital marketing technique.
Exactly how does one navigate the still-murky waters of influencer marketing? And why haven’t more brands been able to successfully and consistently get a handle on how to leverage it?
The landscape is changing. Fast. In 2018, we saw the FTC making updates to endorsement regulations (this time in plain English) in the US. We saw the EU putting up a virtual electric fence around its residents with GDPR to keep marketers from coming in and gathering (and hoarding) private data. We saw the UAE institute influencer licenses that require anyone who accepts payment to endorse products online to be licensed. And brands like Procter & Gamble and Unilever are soapboxing all over the place (that’s a win for influencer marketing, by the way because it will force social media platforms to provide better tools for analyzing influencers- we hope).
Where influencer marketing was once the wild child of marketing strategies, it’s now matured to the point where companies and governments are pushing more and more toward creating regulations and standards.
And yet, there are still tens of thousands of searches every single month from people trying to find information about how to roll out and measure influencer marketing campaigns.
To pay or not to pay? That is a questions brands are still asking. If you’re one of those people who says, “F-off” to any blogger who asks for compensation then you should definitely read this! 🙂
OR, maybe you simply didn’t realize that bloggers charge. If that’s the case, I’m going to give you a run-down of what to expect so that you can plan your strategy accordingly.
The Pitfalls of Influencer Marketing
To give you some context, I’m the co-founder of an influencer marketing platform called The Shelf. I talk to new customers each day about various influencer marketing strategies and techniques that they should consider because we’ve seen that if someone is totally new to the influencer marketing space, they’ll almost always fall into the same pitfalls.
One pitfall I see over and over again is that our customers don’t realize that blogger rates vary for sponsored posts.
For our customers who are new to influencer marketing, this is how their first attempt at setting up some campaigns typically goes:
- First, they go straight to our search engine.
- Without applying any search filters, they’ll start at the very top of our list and send out
- Without applying any search filters, they’ll start at the very top of our list and send out collaboration emails to blogger-celebrities like Lauren Conrad.
- They don’t mention compensation of any sort, aside from gifting her a t-shirt…or some shoes…(whatever it is they want her to blog about).
- And then in return for the free product, they want her to endorse their brand in front of her massive audience of more than 6M followers Instagram.
- They’ll send out maybe 20-30 emails like that to these top-level bloggers and celebrities.
- Then, a few days later, we’ll get an angry email from that customer telling us that none of these bloggers are responding to them.
The problem is, they’re reaching out to bloggers who are simply out of their league. That sounds a little harsh but it’s true. If you’re a small brand looking for newspaper coverage, you might be able to achieve that in your local newspaper without much effort but you’ll have a rough time getting coverage on the front cover of the New York Times. This same concept applies to blogger coverage.
For most of these mega-bloggers, when a brand sends them an email, it’s not even going to the actual blogger. It’s being re-routed through their agent. And these agents are getting bombarded with requests every single day from thousands of other small brands. They can’t respond to all of them.
And this is a hard lesson that many of our newer customers learn. They’ll blast through a list of 20-30 bloggers without having any luck. And then comes their inevitable angry email, after which, I’ll quickly hop on a call with them to come up with a better strategy. From there, they’re off to the races!
Well, it occurred to me today that there’s really no need for these angry emails because we should be helping you BEFORE you get started. And I’m going to do that by telling you everything you need to know about payments and targeting, right here in this blog post! Yay!
Plus, there are two more articles after this one that deal with other common pitfalls. So you’ll be all set!
Reason #1 Bloggers Charge for a Sponsored Post: The time/effort required for a collaboration.
There are a number of variables here, so lets quickly walk through them:
- Brands tend to be super-picky. They want the blogger to mention a variety of key points. They want their items displayed in a certain way. We’ve seen that our customers go back and forth with a blogger an average of 23 times before the post goes live. That’s a lot of time spent on just emailing back and forth about the details! (Some customers, we’ve seen go back and forth more than 60 times, which is just extreme. I think I would tell a brand to go take a hike at that point. But that’s just me.)
- After the details have been hammered out, then contracts have to be signed, invoices supplied, and payments made.
- At that point the blogger is finally able to start working on the post.
- For most verticals, photos are a super important part of the post. So planning is required from the blogger’s standpoint. In fashion, what photos will the sponsored product get paired with? Where will the photos be taken? (While location doesn’t sound important, it is! Good bloggers (we’ve seen) don’t take their photos in the same location each day. Just like the unique outfits and products they’re showing, the setting gets swapped out too. It keeps things fresh and interesting for her regular readers. When a blogger doesn’t switch things up…regular readers find themselves saying, “Oh, there’s that damn porch again…Look, she has a holiday wreath on her door now. Lame!”
- Many bloggers hire a professional photographer to take these inspirational photos of your products in action.
- Once the photos are done, then there’s editing.
- Plus the writing of the post.
- Finally when everything is live, the blogger will need to work her social media magic and spread the post throughout her social networks.
- AND finally that blogger will hopefully be following up with any comments she receives on her blog or social networks.
It’s a big rig-a-marole.
All of those tasks listed above are reason enough for compensation. Would you ever hire a contractor and rattle off that same laundry-list of tasks that you need them to do (and do well)… and then tell them, “Hey, for all your trouble, here’s a blouse.”?
Most of the people we talk to have no idea how much time goes into these posts. But once they realize what all is entailed, the compensation seems a little more reasonable of a request.
One thing to note though: Despite all of that effort involved in putting together a sponsored post, smaller bloggers who are trying to get their blog off the ground often don’t charge. And this makes sense from their perspective. If they’re wanting to start monetizing their blog they need to have some brand experience under their belt. They sort of take an “intern” style approach to the jobs they take on…they do free work in exchange for the experience and resume building. This works out for the brand (if the brand is on a super super tight budget)… because they are able to get some exposure. But the exposure isn’t really enough to justify a payment. So the brand is able to stick within their tight budget.
Reason #2: Supply and Demand
Yay for a little Econ 101. Supply and demand. As soon as the blogger has a little bit of an audience, brands will start to notice that they get traffic from her post as well as some purchases here and there. Other brands start to see that this blogger is working with brands and they decide to get in on the action. Before you know it this blogger has posts lined up all week. She’s running herself ragged doing free work. And then it dawns on her, “Hey, I can start charging now!” And so she does. 🙂
Demand for a blogger just continues to increase as she becomes more well-known. She gets more traffic and followers…more brands discover her and her workload grows along with this. All of a sudden, her week is once again filled up with jobs (even though she’s charging $200 per post)…so she raises her prices.
Now, when a brand comes in and says, “Will you cover my products, and, by the way, I NEVER pay bloggers,” she says, “Suck it!” And makes a gesture of some sort. Probably. Her schedule is already filled up with brands paying her $400 per post. Why would she make an exception for your company? Be honest, here. Would you advise your blogger friend to do the post for free if she could easily get a few hundred bucks from another brand willing to pay her what she’s worth?
Another thing that I don’t really think brands realize is the volume of requests that even the mid-sized bloggers are getting. We’ve spoken to a number of bloggers about this who are in our network and they’ve mentioned that by the time they hit the 10,000 follower-count on Instagram, they were getting 200 emails a day from brands as well as fans. That’s a ton of mail to sift through…and suddenly their little blog has turned into a much more full-time effort.
Two hundred emails is a lot, and when you start considering the amount of time that it takes you to sift through 200 emails, you’ll realize that only special emails with good (and targeted) opportunities will be getting that blogger’s attention, let alone a reply.
Many brands simply start out with the I’m-not-paying mentality…but once they understand the going-rates, then they rearrange their budget.
This isn’t always possible for all brands. Some brands are in super-bootstrap mode and payment isn’t an option. So I’d like to mention that even without a budget, you can still get coverage on some of these mid-sized blogs…you’ll just need to put in more work. We’ve seen many bloggers do pro-bono work, but if you’re going to go that route, get ready to do a lot more outreach because your response rate will be significantly lower.
And, when doing your outreach, you need to be aware that if a blogger decides to work with you for free (despite her typical rates being much higher), you should know what a huge favor you’re getting, and acknowledge this. Because, as you can see above, these bloggers with a large following have worked extremely hard to grow their audiences, and the amount of time that they put into their blog is huge. Way higher than what most people expect. Getting free coverage when others are paying is huge. So let them know your appreciation. And that you understand what a huge favor it is.
One exception to that above statement is when blogger-agents are brought into the mix because agents do a pretty good job of weeding out people who they don’t think will pay.
And while I’m sure it’s not completely unheard of, not too many of them allow pro-bono work to pass through the gates. Agents get paid a percentage of what the blogger is charging. And if a blogger is handing out free work, then the agent doesn’t get paid either. This is more of a speculative opinion though, and if I’m wrong here, I would love to get a little more insight into this in the comments!
(SIDENOTE : How do you know if a blogger has an agent? Most bloggers mention that agent on their Contact or Collaborations page. They will usually request that collaboration requests go to the agent’s email instead of theirs.)
A Little Commentary on Angry Brands Who Refuse to Pay
A little side story: I did some freelance design work for a startup a few years ago. They were in business for about four months before they decided to call it quits. And I remember suggesting influencer marketing to the CEO when he was telling me that he was throwing in the towel. He instantly got all bent out of shape and rambled off his hatred for blogging…“All these damn mommy bloggers…no one does free coverage. Why would I pay for a blog post?”
It struck me as odd that the whole payment-issue would get him so worked up. I remember thinking: if these blogger’s were charging, it might be worth a few experiments to at least see if collaborations with them brought good results. Especially because he didn’t have any problem paying for Google Ads. But when bloggers ask for money…watch out.
And now that I’m working with customers every day who are new to this type of marketing, I see that many people get just as angry as this guy did…some get way angrier. I spoke to this truly irate man who owns a high-end men’s store online. He was dropping F-bombs right, left, and center…and I’m sure after our call, he had to go lie down or take blood-pressure pills or something.
Another founder that I spoke to this past Friday (who is launching a jewelry brand) told me a long story about how they’ve tried 2 different PR agencies, and how she literally has nothing to show for the thousands of dollars that she spent. When I brought up bloggers. She said, “No way! They all charge, and they don’t guarantee any results.” Which is an odd thing to gripe about, considering that’s the exact same scenario that she encountered with the two PR agencies who brought no results…
Except, bloggers don’t usually charge unless they’re generating results for other brands. AND, the bloggers who she would need to target would only be a fraction of the cost of what those PR agencies charged her… so it seems like it would at least be worth an experiment. Instead, she’s planning on finding a third PR agency. Maybe the third-time will be the charm… who knows.
Anyway. Many people get worked up about paying bloggers. And after talking to enough angry people, I think I have it figured out. These brands feel like their product is truly awesome! And why should they PAY a blogger to ACT like they like it…that blogger should like it because it’s great!
And while that makes total sense…the two reasons I discussed above are the reasons why this logic doesn’t hold water:
Time / Effort
and
Supply / Demand.
The reason you want to work with these bloggers is because they’re not a bunch of sellouts who talk about any old product that comes their way. They only work with brands that they love! And they only endorse products that they think will truly resonate with their audience who trusts their guidance.
Paying a super-relevant and quality blogger to endorse your product does not make your product any less awesome. Getting anyone to cover your product is great validation! Regardless of whether or not money is involved. Payment is going to be a factor when supply and demand has kicked in.
Analogies!
In case you’re not on the same page yet, here is a fun analogy-story to help you process the idea (assuming you’re one of those angry brand-owners that I was discussing above).
I went to Portfolio Center, a graphic design school. Every week we’d have a two-hour seminar with a designer that was famous (or at least kind of famous) who would come and present their work. Well, one of the speakers was huge!! Paula Scher came in and was talking about how she designed the Citibank logo. She did it on the back of a napkin. And the client was mad that she charged x number of thousands of dollars for a 15 minute sketch. And she said she was shocked by this. Because in her mind, they’re not paying for that 15 minutes. They’re paying for the last 30+ years of her experience that allowed her to do brilliant work like that in 15 minutes.
With bloggers, you’re not just paying for the hours that it takes them to put together your post. You’re paying them for the years that they’ve spent cultivating, nurturing, and growing their very targeted audience.
Ooo, oo, ooh! I have another one. Why are Super Bowl ads so expensive? If no one cared about the Super Bowl those ads would sell for the same rate that The Fresh Prince of Bel-Air reruns get. In 2018, about 103 million people watched Super Bowl LII. It’s more national holiday than sporting event.
Paying for a huge blogger with millions of followers is the equivalent of Bud Light shelling out cash each year for the Super Bowl spot.
Perhaps that’s a stretch…
The Bottom (Blogger) Line
In the end, you need to make your own decision about whether or not to pay a blogger. If you simply can’t get past the payment thing (whether it be for budgetary constraints or just merely out of principle), then try your luck with finding bloggers who don’t charge.
Once those campaigns are live, check to see how much time you spent and if your returns were worth the amount of time and effort put in, plus the cost of gifted products. The key to doing influencer marketing on a super small budget is being creative!! And there are ways to do this with money-constraints! We’ve done it ourselves with a seriously tight budget!
Lastly, once you figure out where you land on the payment debate, your next step will be to define the strategy for your first campaigns… as well as creative ways to kickstart this marketing channel. And I will be sharing some great insights on measuring ROI, how to create campaigns that tie back to your ROI, and lastly, how to optimize those campaigns once you have some analytics to measure. Stay tuned!
