Working with influencers has become part of everyday life for many companies. According to one study, 59% of the companies surveyed said they were doing influencer marketing.
However, the payment and pricing models of the respective collaborations are not always clear and, at the same time, budgets and interest in influencer marketing have increased rapidly.
Over time, common CPX billing models have become established in performance marketing. But what is an appropriate price for an Instagram post or a video sequence on TikTok and how can influencers be billed?
Why should you use pricing models for your influencer marketing?
Influencer marketing, like any other advertising channel, must be fairly compensated. On the one hand, content creation entails a lot of effort, but on the other hand, brands want to use their budget efficiently.
The pricing models listed below turned out to be the most common pricing models in influencer marketing. However, a compensation model should always be negotiated individually with influencers.
What is the right pricing model for your influencer marketing?
Which pricing model you should end up using is extremely dependent on what product is being marketed and what needs to be achieved. For example, if the goal of your campaign is to sell a product, you can settle with the advertiser per sale through their link. The possibilities of billing are therefore very different and should always be individually coordinated with the goal of the campaign.
We have summarized the most common pricing models for you:
Cost per Click (CPC)
Here, content creators are charged for each click on the ad. Compensation is dependent on the performance of the post, which makes this pricing model very attractive to many companies and creates an incentive for influencers to create viral content. For a large number of companies, this model is now commonplace and has become the standard in influencer marketing.
Cost per Installation (CPI)
In this pricing model, you are remunerated after each installation you perform. This is very interesting especially for mobile app providers and is implemented in many tech startups.
The leverage of a CPI campaign can be enormous and a single TikTok hit can lead to thousands of new downloads. This type of referral marketing is considered one of the recipes for success for many app providers.
Cost per Registration (CPR)
Newsletter, member or event promotion, registrations are key to successful community building and CPR compensates influencers for each registration made.
Cost per Action (CPA)
The CPA defines the average value of the price until a desired action: click, purchase, registration has been performed. This value is usually determined over a period of time and serves as one of the most important indicators for planning the budget in influencer marketing.
Cost per Order (CPO)
A key pricing model in e-commerce is the cost incurred per order.
In this model, orders as well as generated leads are set as the central target and the entire funnel is factored in.
Online store operators use this model for upcoming product launches, upsell campaigns or to increase daily sales.
The thousand-contact price is considered a benchmark in influencer marketing and determines the costs incurred until 1000 people of a certain target group have been reached. Also known as CPM (cost per mille), this pricing model is also very common in print, radio or TV advertising outside the online sector.
With affiliate, influencers receive a personalized link and create content with the goal of directing users to that link.
For each product sold, influencers receive a commission. This gives your company the chance to reach a wide network and spread your offer.
Free samples, discounts or a restaurant visit on the house. Many companies compensate influencers with free products.
It all depends on your use case and it is important to note that influencers only have to present the products provided if this has been contractually agreed beforehand.
What tools are available for measuring KPIs?
You can track these pricing models by tracking and evaluating influencer performance. A large number of companies seek the support of agencies and use their expertise to calculate these pricing models correctly. Based on the data obtained, you can act directly and optimize ongoing campaigns.
One solution would be our hi!share.that dashboard, with this you can measure the KPI’s of your campaigns and get a real time – reporting of your campaigns.
For more information, please visit the following page: https://www.hisharethat.com/0h8pjkm4yq