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Influencer Gifting vs. Paid Collaborations: What to Know
Influencer gifting and paid collaborations seem identical at a glance. Spoilers: they’re not! This post explains the difference and tips for brands prior to a campaign.
Racking your brain over the difference between influencer gifting and paid collaborations?
Both represent ways to get your products into the hands of content creators faster. Given that 61% of consumers trust influencers over brand recommendations, doing so should be a top priority.
To kick things off, let’s quickly define both concepts:
Influencer gifting is when brands send products to content creators in exchange for a promotional social post.
Paid collaborations (AKA sponsorships) refer to influencers posting about brands in exchange for free product(s) and financial compensation.
Although these strategies are similar, they involve different commitments for brands and creators.
Which approach is “best,” though? Below are the benefits and requirements for brands considering gifting versus paid collaborations.
Influencer Gifting 101: Basics + Best Practices
No big surprises here! "Gifting" simply means sending free products to creators.
As a brand, your goal is to earn a shout-out from influencers in exchange.
You don’t have to look hard to find #gifted products across Instagram and TikTok. Gifting campaigns are popular among CPG brands looking to build buzz and earn reviews.
Unlike paid collabs, gifting campaigns rarely involve contracts or commitments for creators. Whether your brand gets a shoutout or review is at the influencer’s discretion.
Here’s a snapshot of the benefits of gifting campaigns for brands and creators alike:
Benefits For Brands
Benefits For Creators
Done right, a gifting collaboration is a win-win for both brands and creators. The key to making product gifting work is simple: send the right products to the right people.
What do we mean by that, though? Think of working with influencers as a value exchange. If your brand's gift wanted to be viewed as valuable, you need to...
- Gift products that are worth posting. Unpaid collaborations won't feel "lesser" if your product is relevant to the influencer and their audience. For example, a skincare kit is a natural fit for a makeup influencer versus a fitness creator.
- Send products with a “cool” factor. Bonus points if your product can "wow" viewers on camera. Not to mention you’re less likely to get ghosted. The easier a creator can integrate a product into their existing content, the better.
- Bundle products to boost the value of your gift. When we talk about "value exchange," consider the literal price tag of your product. Whether that's multiple lower-priced products ($10-$20) or a big-ticket item ($100) is up to you. Consider how PR packages are popular because they make it easy to bundle your products. They also provide a comprehensive sample of what you offer.
"Value" is in the eye of the beholder. This highlights the importance of picking out the right creators.
Again, micro-influencers and small creators know how to authentically promote products. Overly promotional posts will hinder their growth and likewise turn off their audience. That's also why gifting collaborations involve less direction from brands to creators.
Consider that balancing creative freedom with brand requirements is a challenge for 50% of creators. Translation? Brands can’t ask too much of creators for gift-only collaborations.
That’s not necessarily a negative, though. In our experience, influencers know best when it comes to what to publish. Our take is to trust them!
Pssst! Need more inspiration for what to send or what makes a “good” gifted post? Check out the best influencer gifting examples we’ve seen recently.
Rules and Guidelines for Gifting Collaborations
Now, onto the rules! The FTC has specific guidelines for gifted products and influencer marketing.
The short of it? Influencers must differentiate between promotional posts and organic posts about products they like. This applies to gifted products with no other form of compensation.
There are a few ways that creators can do this according to the FTC:
- Including hashtags like #gifted to disclose partnerships
- Using clear language (“I was gifted this product by…”)
- Explicitly stating (in a caption or video) that a brand sent them a product to review
The major social platforms pretty much follow the FTC’s lead. Gifted posts fall under the umbrella of “branded content” on Instagram and TikTok.
According to Instagram themselves, brands should “clearly” disclose gifted partnerships. Many creators will outright say they were gifted a product in their post captions. Others might tag the brand and use a #gifted hashtag. TikTok's branded content policy outlines similar rules.
There’s no one-size-fits-all way to disclose gifted collaborations. This is actually good news for brands and creators, though. Gifted posts don’t have to sound rigid or needlessly promotional.
Influencers and brands can get creative while still playing by the rules. Many skincare brands have their own branded #gifted hashtags for creators promoting products. Below is an example from Supergoop.
Remember that it’s up to you to establish these requirements with creators. This is why brands should find influencers that already know the rules for promoting products.
Note on Affiliate Links: You might be tempted to provide influencers an affiliate link or promo code along with free product for their followers to take advantage of. Still, you must disclose this sort of partnership as well. Consumers must be aware that although products were given for free – if they make a purchase, the influencer will be making a profit.
Paid Collaborations 101: Basics + Best Practices
Paid collaboration between brands and influencers involves financial compensation beyond free products. These collabs are popular for brands targeting specific creators with large audiences.
Benefits for Brands
Benefits for Creators
Think of paid collab posts like traditional ads. The difference is that influencers can inject some much-needed creativity into their posts. It’s well-documented that creator-based ads perform better on Instagram and TikTok than non-creator ads.
Branded content ads are a popular form of paid collaboration on Instagram right now. These ads take organic creator content and transform it into promotional content. These posts contain the “paid partnership” label on Instagram (see below).
Beyond budget, the key difference between gifting and paid collaboration is creative direction.
With most paid collabs, brands call the shots when it comes to what influencers say in a post.
Sponsored content involves a detailed creative brief with explicit instructions and talking points. On the flip side, gifted posts let creators freestyle and share unfiltered thoughts.
Instructions can remove some of the personality from your sponsored content. This again highlights the importance of creative freedom. That said, skilled creators can strike a brilliant between personality and promotion.
Rules and Guidelines for Paid Collaborations
The FTC has guidelines for product endorsements and monetary compensation on social media. Here’s a five-word summary: when in doubt, disclose it.
- Including disclosures like #ad or #sponsored in their post captions
- Using the “Paid partnership” tag on platforms like Instagram
Failing to do so isn’t worth the potential backlash and fallout (think: fines and suspensions).
Despite their similarities, note that not all disclosure hashtags are the same. For example, #ad implies that a post’s language and endorsement are approved by a brand prior to posting. Meanwhile, the #gifted tag is more of a general label.
The FTC is crystal clear that disclosures are the responsibility of brands and influencers (hint: not social platforms). On that note, applying a “sponsored” or “paid partnership” label isn’t considered a disclosure by default. According to the FTC:
“Just because a platform offers a feature like that is no guarantee it’s an effective way for influencers to disclose their material connection to a brand.”
And that’s why we still see the #ad disclosure in paid collaboration posts.
Influencer Gifting vs. Paid Collaborations: Which is “Best?”
The short answer? It depends!
Fact: a staggering 77% of marketers say that influencer collaborations are effective.
Whether you’re sending free products or compensating creators with cash, both strategies are effective. It's all about creating an equitable value exchange.
The most important piece of the puzzle, though? Sending your product to influencers with an audience that’s excited about what you’re selling.
And if you need help connecting with relevant influencers, Statusphere can do the heavy lifting.
Our turn-key influencer marketing platform empowers brands to earn awesome creators at scale. We match businesses with creators from our handpicked network and handle everything from fulfillment to tracking campaign performance.
Want to learn more about how the process works? Get in touch with one of our consumer-to-consumer marketing specialists to see how we can get more people posting about your brand ASAP.
This article was first published in June 2020. It was last updated October 27, 2022.