Influencer Marketing has helped brands to reach a large audience and build stronger brand loyalty. However, in the current economic crisis, setting the right budget for influencer marketing is necessary to survive.
Since the inception of social media platforms, brands have been partnering with influencers to increase their engagement with the audience, promote their products and services, and increase their ROI.
Many big brands and even the emerging ones have successfully launched marketing campaigns by partnering with influencers, and have seen a sharp increase in their ROI. They have also contributed to increasing brand awareness and loyalty among prospects. However, the current draconic times are changing the influencer marketing landscape.
As the pandemic has accelerated the economic downturn, many brands are forced to make significant budget cuts. Therefore, it is vital for brands to make the most from each penny, especially due to the rise of fraud influencers, to sustain themselves in the market.
Though compensating influencers based on the number of followers seems tempting, it may not always yield the necessary results. Brands should also see the kind of engagement the influencer has and whether it aligns with the company’s values and goals or not.
These parameters though essential, cannot tell the whole story. And marketers relying only on them for insights and hoping to make informed decisions can face backlashes leading to massive investment in time and money.
Understanding the payment model
According to Traacker, brands on Instagram that are paying based on CPM are overpaying by 262% based on a model that a brand would reach 1,000 people. If they spent on the traditional CPME model (the amount required to generate 1,000 engagements), the cost per post would only be $643 as opposed to $2,158.
Utilizing the CPME based model has more benefits as it’s about successful results instead of vanity metrics like reaching a broad audience.
Not Rewarding the Quality of Work
Overpaying and underpaying are certainly the issues when it comes to influencer marketing. The fraud influencer scams surfaced in recent years can make marketers think twice and only encourage them to make decisions that may undervalue the quality of work of a genuine influencer.
Hence, having a comprehensive look at the influencers’ content performance, insights, engagement, and an elevation in the brand’s image should be critical metrics when deciding to pay an influencer.
Paying handsomely to these influencers also boosts their confidence and helps to strengthen partnerships with them.
The Key Metrics
Below are a few metrics brands should know to keep in mind while evaluating the influencer’s budget.
- Audience Quality: If an influencer is engaging in inauthentic practices such as buying likes, comments, and followers, they won’t help brands to spread their message to their intended audience, leading to campaign failure.
- Demographics: There’s no denying that demographics play a crucial role. They are ones who would use products or services. Hence, it is essential to find influencers who may have fewer followers but have the potential to increase brand awareness and loyalty.
- Risks: Partnering with influencers who have a bad reputation, having offensive behavior, and use derogatory terms can negatively impact a brand’s image. Therefore, having a thorough background check who the influencers are, what they have done, whom they have partnered with, can go a long way to deciding the right budget.
Creating such criteria before deciding to partner with an influencer can save time and money. When partnering with the right influencers, brands can understand their requirements and needs and leverage the influencer’s audience resulting in a strong influencer marketing management program.