Try to Google how much you should be charging a brand for a sponsored posts. Did you get a straightforward answer? Our guess is no.
Determining influencer compensation can be tricky for both you as an influencer and even for the savviest of influencer marketing experts. There just seems to be no real consensus on the amount that influencers should charge brands for a sponsored post, or that brands should ask to pay for a sponsored post.
However, considering that influencers have a reach similar to that of social media display ads, assuming some standard rates can be useful when estimating costs.
Cost Per Thousand
Marketers often use CPM (cost per-thousand impressions) as a standard marketing calculation to determine the cost to reach 1,000 potential customers with an ad campaign. CPM as a metric is all about estimating how much it costs, for an ad to receive views from a specific number of potential customers. So CPM is ideal for when a brand wants to get a lot of eyes on an ad.
By examining the cost to reach 1,000 potential customers for each marketing tactic, whether it’s on various social media platforms, or completely different marketing methods, marketers can note at a glance which tactic costs more to reach the same number of individuals. Deciding where to invest.
Average CPM on Social Media Display Ads
Typically, on social media platforms such as Facebook and Instagram, the more advertisers there are for a particular target audience the higher the cost will be to advertise to it. Which in turn means a higher CPM, for popular markets. So although costs vary and depend greatly on the audience you aim to reach, reports show that Instagram seems to have the cheapest CPM for display ads on social media. Based on the global advertising performance benchmark, the average CPM for Instagram was $5.68 and for Facebook $6.28. Sales force Marketing Cloud found the average CPM for Twitter to be $6.93 for Facebook ($5.75) and for Instagram ($4.44). The cost per 1000 impressions (CPM) was $7.34 CPM (https://adespresso.com/academy/blog/facebook-ads-cost/) and for Youtube $7.60 hthttps://whyvideoisgreat.com/whats-cpm-youtube.
Average CPM for Influencer Marketing Sponsored Ads
Just like display ads, as an influencer you have the potential to speak to thousands of potential customers with one post. In influencer marketing, CPM is largely related to the size of the Influencer’s audience; with well known influencers with a large following driving similar impressions to the ads on Facebook, Instagram and Twitter.
In theory, a sponsored post can be seen by all of your followers, which means that the number of impressions a sponsored post receives would be similar to your reach. However it’s a little tricky as one post can have multiple impressions from the same person, a follower can view the same piece of sponsored content more than once, and also a follower may not see the sponsored post at all. Overall, the CPM for influencer sponsored content has been found to be 3 times cheaper than any social media advertising (study SocialChorus / https://www.marketingtechnews.net/news/2016/sep/16/why-influencer-marketing-eating-cake-traditional-advertising-budgets/)
Why Influencer Influencer Marketing wins
Other than the fact that it's cheaper, influencer marketing seems to win over all other digital marketing ads because it also yields more engagement as the content influencers produce is much more trusted, whereas digital ads are rarely trusted and 47% of people even admit to blocking them.
How much should you charge as an influencer?
So overall Average CPM's on social media range from:
Average CPM for specific social media handle x number of followers / 1000
With Sponsored blog posts, rather than having followers, to estimate the number of potential impressions, blog posts have average unique readers per article, or UMV (unique monthly visitors).
$10+ x per 1,000 unique visitors in a month that a blog post is live seems to be pretty standard (link)
You could use the above averages as an indicator for how much you should charge brands based on your following. Multiplying the CPM or UMV accordingly by the number of your followers on each of your social media handles.
However, even in the averages above, among the social media platforms and between influencers, there is a big range in price.
You shouldn’t expect a brand to pay the same amount, to two influencers with the same number of followers but with completely different engagement rates.
Influencers whose content spark interaction, lively conversations, and help reveal more about the brand and its products are considered more valuable and will be more expensive than, influencers who simply post a photo and get mere impressions, with no interaction.
But it's important to note that not all engagements are equal. Shares, comments, likes, re-posts, post-clicks all hold different weight on different platforms. Instagram receives higher engagement rates than Twitter and Facebook.
Cost Per Engagement
Unlike CPM which is used as a metric more so for brands who want to increase exposure, CPE (cost per engagement) is a better predictor of sales. As when followers interact with your content, rather than being mere bystanders, they are more likely to go one step further into becoming buyers.
As reach increases engagement rates decrease. So for influencers with smaller followings, even though their CPM may be higher since their posts reach fewer people, their CPE would be lower as they have an increased engagement rate.
Your engagement rate is provided on your media kit as a percentage. If you'd like to estimate the number of your average engagements in order to estimate your CPE multiply your engagement percentage by the number of your followers.
Formula $0.20 – $0.30 (cpe) * nUMBER OF AVG ENGAGEMENTS (engagement rate % * followers)
You could use CPM or CPE to estimate how much you should be charging brands. You could also alter your prices accordingly.
Charge: More if a large brand, requires more work or has high production costs
Less if it’s a small startup or a charity or includes a product, or event
I'm head of Content at ZINE, where I use my expertise in fashion consumer psychology to empower brands and influencers in their marketing campaigns. I love to travel, bake as well as shopping online.