The Foolproof Formula for Calculating Instagram Influencer Rates
There are a number of factors that go into calculating your Instagram influencer rates — and they go well beyond how many followers you have!
One of the most difficult parts of being an influencer is learning what your work is worth and how much you should charge.
Ask for a fee that’s too high and you risk pricing yourself out. Too low and people might doubt your worth.
Either way, you may come off as someone who’s new to the game and easy to take advantage of!
Ready to learn whether an offer is fair or not? In this post, we share our foolproof formula for calculating your influencer rates:
What to Charge For Your Next Influencer Marketing Campaign
Uncomfortable talking about money? You’re not alone!
Most people are intimidated by negotiations. That’s why it is so important to figure out how much you are worth and be confident in that number. Calculating your influencer rate will help you stay strong when negotiating and help you realize when a campaign isn’t worth the time/effort and you should just walk away.
There may be times when you might lower your fee because you want to meet the brand in the middle, but remember clothing, trips, and beauty products don’t pay the bills.
Negotiating is much easier you’ve nailed down the numbers. Whether it’s a blog post, Instagram post, or YouTube video, the formula for what to charge is simple:
Distribution Fee + Talent Fee = What You Should Charge
Let’s start by understanding the difference between your distribution fee and your talent fee.
Calculating Influencer Rates: The 5 Distribution Fee Factors
Your distribution fee is how much it costs to be featured on your social channels or blog. Just keep in mind this price can vary greatly based on 5 factors:
#1: Follower Count
This is simply how many followers you have. While this shouldn’t be your main sell, it’s definitely an important factor in determining your influencer rates!
Your engagement rate is the percentage of followers that engage with your posts. To calculate your engagement rate, divide the average number of likes and comments you get by your follower count, which will give you a percentage.
You can view the number of likes and comments per Instagram post with Later’s free Instagram Analytics.
Just add the average number of likes and comments together, say it’s 1000, and then divide by your followers, like 10,000, which gives you .1. Then multiply by 100 to get your percentage, which would be 10%. That’s your average engagement rate!
Your engagement rate tells brands that you’re making wise decisions with the money they give you and investing in production quality (like renting a unique space of the backdrop or hiring a professional videographer) to make sure the content performs.
#3: Quality of Content
If brands are contacting you, your content is good, but how good is it?
Today’s influencers have become pros at concepting, shooting, and executing mini-campaigns for brands and should be compensated accordingly. Businesses are even using influencer content across marketing outlets, such as magazines, billboards and even television commercials. This is your goal, not only because it solidifies your status as a true content creator, but also because that kind of usage is premium and you can make more money!
#4: Name/Facial Recognition/Skill
More often than not, businesses that share influencer content on their social channels are very well received by their audience. But if the influencer has a recognizable name or face, when the businesses shares, comments could turn from “great shot” to “OMG I LOOOOOVE XYZ INFLUENCER.” That’s a win for the brand and a big win for you.
Similarly, if you’re an amazing dancer or make great looking cakes, they’re also paying for access to your skills — which you’ve probably spent years honing — to make the sponsored piece of content really stand out. Skills = Time and Time = Money.
This is when it definitely pays to have a niche. If a brand is looking for college students who live in a particular city and would die to have their new eyeshadow palette, and that’s your audience, you’re instantly much more valuable to a brand than another influencer who only speaks to one of those target demographics.
Want to learn more about choosing the right influencer for your business? Download our free Instagram Influencer Marketing Guide here:
Your talent fee is how much it actually costs you to create the content. This number includes all costs associated with the campaign and your hourly rate.
Marketers have become familiar with paying teams of photographers, creative directors, and producers to build out their digital campaigns in the past, and should look at influencer marketing in the same light.
To figure out a basic minimum budget calculate the cost of:
- Your photographer/photo editor
- The space where you’ll be shooting (hotel room, Airbnb, etc.)
- Any props you’ll need to purchase (food, candles, flowers, balloons, etc.)
- Any clothing you’ll need to buy (sometimes a campaign will cause you to shoot off-season and you’ll need to buy new clothes so the content looks fresh when you post it months later)
Next, you’ll need to factor in your hourly rate. Whether you’re writing a blog post, self-producing a photo/video shoot, or working on set, these things take time and time is money.
If you’re just beginning, you might start at $25/hour and increase your hourly rate as you gain experience and have more campaigns under your belt. Activities under this hourly rate will differ depending on the campaign, but should include:
- Negotiating with the casting agent (1 hour)
- Reading the brief and researching the advertiser (2 hours)
- Scouting and securing a location (2 hours)
- Creating a mood board of the shoot (2 hours)
- Shooting the content (up to 10 hours)
Add these two together, and that is how much you should charge. You can take a look at this handy, dandy chart* that will provide you with a healthy range for each tier:
Now that you’re equipped with a foolproof formula for calculating your influencer rates, you’re ready to start negotiating like a pro! Have any other tips or tricks for calculating your influencer rates? Let us know in the comments!
*Adapted with permission from INFLUENCER: Building Your Personal Brand in the Age of Social Media by Brittany Hennessy. © 2018 by Brittany Hennessy. Citadel Press Books, published by Kensington Publishing Corp.