We Need to Talk About Paying Influencers

*This article was originally written by me and published on the Assembly blog.*  

If you happen to be active in the influencer marketing community on social media platforms such as LinkedIn, you are likely to have been witness to at least a dozen discussions and debates around one key topic:

“Should marketers pay influencers?”

This is a fascinating topic – one that is both complex and controversial in the influencer marketing space. It is clear that many professionals in this area believe that the gold standard of influencer marketing is simply to not have a transactional relationship at all. Instead they recommend that the best relationships for influencers and brands are built on value exchanges such as free products and services, event invites, exclusive information, exposure and more.

But is this really the best type of relationship to be building with influencers? Should we really be putting the brand-influencer non-transactional relationship on a pedestal or will this kill the industry?

In this article, we take a look at a few of the options in influencer relationships and discuss the positives and negatives of each.

 

100% non-transactional

Relationships between brands and influencers where absolutely no money changes hands at all are 100% non-transactional. There is no denying that in theory this is the perfect set up when dealing with an influencer. After all, isn’t the point of it all to create genuine content endorsing the brand in an influential way?

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There are certainly situations where a zero-pay relationship may work and is fair. This is almost exclusively in B2B situations where the brand can add substantial value that is truly going to benefit the influencer in some way or another. For example: The creation of a webinar or whitepaper that will bring exposure to both the brand and the influencer. This being said, the extent to which each party will gain from a relationship is often overlooked.

Brands occasionally do not consider a couple of crucial points:

  • If the content will be hosted and promoted by the brand, they are very likely to gain a substantial amount more than the influencer in terms of exposure and potential sales.
  • Those contributing from within the brand will likely be being paid a salary based on their contribution, it is unlikely that the influencer will make any direct or guaranteed financial gain from the relationship.

With this in mind, it is important for the brand to consider the weighting in terms of effort spent versus the gains made by each party. To further remedy this the brand may also choose to invest indirectly in the influencer through paid promotion and other promotional benefits to boost the content.

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100% pay-to-post

Pay to post is in contrast a fully transactional relationship. This type of arrangement is prolific in the B2C space and is what many would consider as the most common form of influencer marketing. With some influencers reportedly making $300K+ per year, it is unsurprising why we see pay-to-post getting a large amount of coverage in the media. Here we see brands directly paying influencers to either produce content or simply post a pre-created piece of content onto their feed without any relationship being built.

Paid relationships can and do have a place in influencer marketing. When looking at the different relationships within influencer marketing you need to understand one thing; the tool is useless unless it contributes to achieving a business goal.

Take for example a startup: They have an awesome product, but competition is hot. Two elements of this situation lend itself to pay-to-post influencer marketing. First, they need to reach a relevant and engaged audience and they need to do it fast before their competitors can saturate the market. In this situation, slowly building up a relationship in the hope of getting some exposure is not a good strategy. Add to this the fact that a startup is likely to have little in the way of other value to add in terms of exposure, and a pay-to-post relationship may well be the best suited.

This approach does miss many of the advantages of having the time to educate influencers about your brand. Directly paid adverts are becoming easier to spot as a result of many regulatory bodies enforcing the #ad for posts that have been paid for. Although still in the early phases of adoption, this hashtag is being widely used among larger influencers.

Hybrid

Enter the hybrid relationship. Practically, this is how many brands and agencies deal with influencers…even if they don’t like to admit it. This type of situation means that value is added both through payment but also through the development of a relationship over time.

Although payment is involved here, it is often as a result of the relationship rather than the igniting spark of it. Take for example a brand that has built a relationship with a number of key influencers through engagement and perhaps the gifting of some products. The brand then decides they are going to run a new campaign and if their key influencers would be excellent contributors to the content element. In this situation, the brand would start a conversation about paying the influencers to create some content, therefore paying for the expertise of the influencer and not necessarily the reach or influence they have on their various platforms.

It can be very difficult, if not impossible, to spot hybrid relationships when they are done well. They should look natural, seamless, and simply like an endorsement. These relationships are often long term and the brand will work its way into much of the influencers content based on the fact that they have strong communication and have built a brand advocate over time.

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Flat fee

Similar to the hybrid route outlined above, many brands are now opting for a flat fee type of structure with influencers. This allows the brand to offer payment, but only up to a certain amount. Anything beyond that will be bartered as part of the value exchange in order to make sure that both parties are getting a fair deal.

This not only means influencers are more likely to be interested in the products or services that they are promoting, but also means that the brand can be 100% transparent about how they are interacting with others and therefore increase the trust between all those involved.

Centralize and optimize your influencer marketing strategy

There really is no gold-standard when it comes to influencer marketing. Instead, there are relationships that work better than others depending on the business itself and their goals. Although a fully non-transactional relationship may work well in some B2B situations and pay-to-play in B2C, a combination of the two can be a good way to build strong relationships and truly benefit from influencer marketing.

The name of the game when it comes to paying influencers is flexibility. Every influencer will have a preferred payment method and negotiating both a fair rate and equitable terms can be either the beginning of a prosperous relationship or a deal breaker. Assembly stands out as the gold standard for companies who either have established relationships with influencers, or who are looking to take their first steps because Assembly can facilitate any agreed upon payment method with ease through one central hub.

Great brands know that they need to use all the tools available to them to navigate this complex landscape. Join them by getting started with Assembly today.

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