Need to budget for influencer marketing? This post breaks down how to set a smarter influencer marketing budget to meet your brand's goals in 2022 and beyond.
Struggling to settle on an influencer marketing budget for 2022? You’re not alone.
Most of our team (myself included!) comes from an agency background. We’ve lost count of how many clients have pivoted away from traditional advertising in favor of creator-based campaigns.
And we’re not just saying that because we’re all about influencer marketing.
According to data from Kantar, a staggering 71% of marketers plan to increase their influencer marketing budgets in 2022.
Source: MarketingCharts.com
This boost accounts for more than all other forms of media minus video ads. Thing is, influencer campaigns are proven to increase conversion rates there as well.
The data above reflects exactly what we’ve seen firsthand — more consumers flocking to TikTok, Instagram and YouTube to find their next purchases.
And by partnering with creators on the platforms where your audience spends most of their time, you have a golden opportunity to boost awareness and drive sales.
Wondering how much to spend on influencer marketing? Start here.
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If you’re ready to set your 2022 budget but don’t know where to start, we can help.
Because we get it — budgeting for influencers is daunting. There are so many questions to answer before you even start looking for creators. This includes:
Oh, and how do you justify your influencer budget and explain the ROI to your boss?
Thankfully, our budgeting guide answers all of the above and more!
But first, let’s dig into the three approaches to launching an influencer campaign:
Based on your approach, you can accurately draw up a budget that makes sense.
Many companies choose to manage their influencer marketing campaigns completely in-house. The do-it-yourself approach is popular among small businesses and startups looking to stay lean.
Let’s say you’re willing to put in the work on your own. For starters, you’ll need a team member with the bandwidth to manage the process. This includes seeking out social media influencers, assessing their audience engagement rate, negotiating terms, handling communication and coordinating shipments.
(Yeah, it’s a lot!)
Another hurdle with the DIY method is that there’s no guarantee your prospects will actually post. With no obligations, influencers can drop off at any point in the process.
But if you have a tight budget and the time to coordinate each and every influencer, you can make this option work on a small scale.
The second way to manage your company’s influencer campaigns is to sign up for an influencer database. These platforms aggregate influencers across industries and provide a channel for brands to conduct contact.
These databases make it easier to hone in on potential partnerships from people who want to be approached by brands. This increases your success rate during outreach.
But you’re still investing in something that’s not exactly guaranteed.
How so? Well, instant access to creators is a massive time-saver in theory. While influencers from databases should be vetted, this isn’t unfortunately isn’t always the case.
Databases definitely save you time when finding and vetting influencers. That said, conducting outreach at scale can turn into a full-time job. Getting your money’s worth means being consistent and proactive about building relationships.
If your company has outgrown the in-house approach but can’t commit to an annual contract, there is a third option: a scalable influencer marketing platform.
These platforms do the legwork of matchmaking and managing relationships for you.
This approach allows for influencers to post quickly, efficiently and on their own terms. As an added bonus, your influencers are empowered to create content they believe will perform best with their followers. Since they built their own following from scratch, you can trust their judgment.
This approach is ideal for:
If you’re willing to sacrifice a bit of creative control, the time savings can be huge here. We estimate about 70 hours saved per 30 influencer posts.
So, the big question: what’s it going to cost?
Budgeting is tricky because there is often overlap between the benefits of influencers and the rest of your marketing campaigns. For example, consider how influencer marketing:
Identifying this overlap in your marketing activities can help you squeeze more out of your budget. Hey, you may even reduce your marketing spend elsewhere.
The simplest way to budget? Dedicate 15% of your marketing budget to paid influencer partnerships.
A recent industry survey says that 38% of brand managers plan to allocate between 10% and 20% of their budgets to influencer marketing. Meanwhile, a combined 78% of brand managers look to allocate 10% or more.
And so with 15% of your budget earmarked for influencers, you’re in good company.
Source: Influencer Marketing Hub
Meeting in the middle means you’ll have bandwidth and resources for additional campaigns. Still want to invest in paid social or retargeting ads? Go for it!
Keep in mind that budgeting for influencer marketing is about more than just dollar figures and percentages, though.
That’s because what you end up paying your influencers doesn’t factor in the investment of time required to get your campaigns up and running. Finding, vetting and managing influencers can be a potential time-sink if you’re doing it all yourself.
Now, let’s dig deeper into monetary costs and how to calculate a monthly budget for each of the three approaches we just talked about.
The main consideration for in-house influencer campaigns is how to pay an influencer.
Sure, there are plenty of influencers who will post in exchange for free products.
But you often get what you pay for.
If you’re planning to perform influencer outreach consistently, we recommend factoring influencer compensation into your budget.
We find that most micro-influencers will ask for between $50 and $250 for one-off posts ($150 on average). They'll also ask for free products for their time.
This number varies from creator to creator, though, in addition to how many content requirements you’ve requested. Speaking with Statusphere team members with firsthand experience as influencers, lower-end payouts can range anywhere from $0 to $300. On the higher-end, influencer payments can extend into $1,000+.
Having experimented extensively with the DIY method, we find it takes about 2.3 hours to secure one influencer post. This time spent includes searching for, messaging with and shipping products to influencers.
If you’re planning to only gift products in exchange for posts, go ahead and double your monthly hourly budget. Trust us: you’ll need it.
Statusphere team member and micro-influencer Alexa Groat said of gifted campaigns:
“When accepting gifted collaborations, I think of the value of the product (if it’s a well-known brand or if it is a product I am very interested in and would otherwise buy on my own) as well as a low amount of posting requirements.”
Unless your product has a high dollar value and you’re keeping your posting requirements to a minimum, you might want to budget for some monetary compensation as well in order to increase your odds of successfully landing partnerships.
Most influencer databases require an annual contract. You’ll need to factor this into your budget (on top of what you plan to pay influencers).
Databases can cost anywhere between $750 and $2,000 per month to access.
Another consideration here is the salary of a full-time, in-house team member to manage influencer outreach. After all, why pay for database access if you’re not going to use it to the fullest?
Note: you could potentially outsource influencer outreach to a contractor to save cash, but at that point you might as well hire an actual service to help.
Again, databases are useful but they’re far from a full-service platform.
A full-service influencer platform will typically use a cost-per-influencer-post pricing model.
For example, Instagram post costs can vary depending on factors such as:
You can expect to pay a scalable influencer platform between $100 and $300 per post for micro-influencers. This includes influencer compensation and shipping costs.
The upside? Time saved!
Again, we estimate about 70 hours saved per 30 influencer posts. Since scalable influencer platforms are largely hands-off, you get the benefit of great content without sacrificing your schedule.
And because high-quality content is guaranteed, you reduce your influencer marketing cost and earn a greater ROI long-term.
No big surprises here — influencer marketing budgets are on the rise.
A recent forecast by eMarketer predicts that influencer spending will break the $4 billion mark this year, marked by a 12.2% increase throughout 2022.
Source: eMarketer
This isn’t a passing trend, either. Increased spending on influencers has been consistently on the uptick and won’t slow down anytime soon.
Consider that 57% of industry professionals planned to up their influencer marketing budgets in 2020 — that number then jumped to 71% in 2021. Also notable was the fact that brands claiming they weren’t increasing their influencer spend was slashed in half from 2020 to 2022 (61% to 29%).
Translation? Not only are brands spending more on influencers than ever before, but those that invest in creators tend to stick with them long-term. This signals the ongoing value of influencer campaigns.
The short answer? Creator campaigns have proven effective time and time again.
Beyond the data above and what we’ve seen from our own members, consider the proven benefits of working with influencers including:
Also, note how Instagram and TikTok are adapting to embrace the growth of influencer marketing. Both platforms implement new business features and social shopping features regularly. From TikTok shopping and Instagram’s creator-centric shopping platform, integrating influencers into your social sales strategy is easier than ever.
But again, winning with influencers doesn’t happen by accident. There’s no denying the time and energy required to make your campaigns work (especially if you’re going the DIY or database route).
To wrap things up, let’s review the importance of picking the right types of influencers for your brand.
Many critics still think of influencer marketing as shelling out for a celebrity to make a random post about your product.
The reality, though? That’s far from the truth. Besides, celebs aren’t ideal for most influencer campaigns (unless you’re a massive brand with a bottomless budget).
There’s a reason why brands are working with smaller influencers on a larger scale versus one-off celeb campaigns. Not only does the cost of influencer marketing go down when you work with smaller creators — the results are bigger.
Heck, we’ve seen it firsthand. Consider below:
These stats highlight both the value of working with smaller influencers and why they’re perfect for most brands.
And with a fully-managed, scalable influencer platform like Statusphere, you can work with micro-influencers at scale to maximize your reach and budget.
If you’ve been working without a dedicated influencer budget, you’re one of the few.
But we totally understand the struggle!
From debating how much to spend on influencer marketing to managing creator relationships and beyond, there’s so much to get stuck on.
That’s where we can help. Statusphere’s full-service platform can manage your influencer campaigns from start to finish. This includes finding awesome creators, getting your products in their hands and tracking the success of your influencer content after it’s live.
Our consumer-to-consumer marketing specialists can figure out the best budgeting options for your brand and match you with the right influencers ASAP. If you’re ready to kick off a campaign to get creators posting about your brand, contact us today!
This article was first published in October 2020. It was last updated on March 1, 2022.
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