Guides and Templates

Calculate influencer rate

Getting started with calculating the influencer's fair rate

The contract with a creator defines the 

  • Deliverables and

  • compensation

 

In this part of the Fourstrazz Academy, we'll look at how to compensate a creator and how you can calculate it.

 

Things to know

You have shared with the creator the expected deliverables. Now they'll get back to you with their pricing. 

 

During the negotiation process, you need to evaluate this rate and decide whether it is a fair offer and whether that fits your budget.

 

But how to do this?

 

Fourstarzz is providing for each of the creators a "Social Post Value". It is a suggested rate based on the number of followers and the average engagement rate. 

 

The price provided is an estimated rate for one post (for example value of one Instagram Feed Post). So if you ask for multiple posts, you need to multiply the suggested price with the number of publications. 

 

These rates provide you with a baseline against which you can compare the influencer's rate. It is a good starting point. 

How to negotiate the pricing

 

When negotiating, keep in mind that there are multiple compensation options. The typical once are: 

  • Fixed Price: Pay per post

  • Affiliate Based Commission: Pay influencer based on clicks or sales

  • Products: Compensate creators with products

  • Fame: Influencers are featured on your channels (only relevant if your channels have more followers than they do)

 

If you ask an influencer for their rate, they will probably come back asking for cash compensation. That is great, as that is the value they are looking to receive. 

 

Now you can counter the ask with a package, where you combine cash, products, and affiliate compensations. 

 

Example: 

Thanks for providing me your rate. Unfortunately, we have some budget constraints, but I would like to offer you a compensation package that has a higher overall value. We'd love to compensate you with a $250 fix cash payout. On top, you can choose products worth $250. As we are looking to work on a longer-term relationship, we would like to include you in our affiliate program. This would guarantee you another cash income (x% of each purchase). 

 

Market Prices for Influencers

Here are some price points that we see in the market: 

 

Prices for one Instagram Feed post: 

$10 for 1'000 followers

Prices for one Instagram Story:

$ 5 for 1'000 followers

 

Price for one Video (Youtube, Instagram or TikTok): 

$25 for 1'000 video views

 

Let's have a look to understand better what can impact the influencer's rate calculation, next to the reach. 

 

1. Time and Effort

An influencer will create content to publish on her/his social media channel: text, videos, pictures. Influencers spend time on creating the content and will price this in. The more complex a project, the more time is needed, the more expensive it is. On top, they might have expenses like costs for photographers or fees for soundtracks, etc. 

 

2. The number of publications:

The more publications, the higher the overall pricing. But usually, each additional post will be cheaper than the first one. Influencers tend to give good package pricing. 

 

3.Average Engagement rate: 

Fourstarzz provides average engagement rates for each of the influencer profiles. It is calculated by looking at past posts. The higher the engagement rate, the higher the probability that the followers will engage with your brand and make a purchasing decision. You want to spend more on influencers with a higher engagement rate. 

 

4.Chosen Social Media Channel:

The channel for your social media marketing campaign will be a determining factor. Each social media channel has a different base rate. For instance, Instagram videos are typically shorter than YouTube videos. So, you can expect to pay more for YouTube collaborations.

 

Payment terms

 

Once you agree to a rate, you can enter this rate into the template contract in Exhibit A - Program Details. 

 

Influencer shall be paid as follows for the Deliverables: [INSERT FEES]. Influencer shall be paid when [INSERT TIMETABLE AND PARAMETERS FOR PAYMENT].

 

Insert the fees as a total number. We highly suggest to only payout creators once they have delivered their content. 

 

To define that, you can enter a timetable or parameters for the payment. 

 

Example: 

 

Payment after

  • All content has been published

  • The influencer has sent full results reporting

  • The influencer has sent a W-9 form

  • The influencer has sent an invoice

 

 

Template

 

Please download the following cost estimation tool.

It is an excel sheet that calculates the values based on cost per thousand followers or impressions. 

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