New research by Rakuten Marketing reveals the astronomical fees UK brands are ready to shell out on influencer content mentioning their brand, but also raises concerns over whether these hefty investments pay off.
According to the research, Facebook celebrity influencers can be paid up to and over £75,000 for a single piece of content and the fee can reach over £160,000 for premium fashion marketers. For YouTube stars, offers can sit at around £67,000 per video while Snapchat gurus can expect to receive up to £53,000 per “Snap”.
Payments for micro-influencers (those with under 10,000 followers), on the other hand, vary between up to £1,500 per Facebook post to up to or above £3,000 for a YouTube video.
A measurement issue
The disparity in fees reflects the way marketers measure influencer marketing success, with 54% tracking brand reach, including the number of followers and engagements.
Despite the significant figures marketers are ready to pay top influencers, only a fifth (20%) can demonstrate an impact on sales and 38% remain unsure whether it drives sales. When it comes to paying up, most (86%) are also not sure how influencer fees are calculated.
However, the results prove the growing value of influencer marketing as a channel and the importance of social media, particularly for high-end retailers. With three-quarters of those surveyed (75%) confident they will continue spending more on influencer campaigns over the coming year and over a third of them (35%) anticipating the increase will surpass 50%, the channel is only likely to keep growing.
It isn’t only money matters that remains vague between marketers and influencers. Although just over half (59%) of marketers confirm the influencers they work with take guidance from them in terms of best practice, only 20% believe influencers would follow their lead in terms of billing, and many premium publishers experienced situations where influencers held all of the power.
Rakuten Marketing’s SVP and MD of global attribution, James Collins, is confident the channel can be “hugely effective” but as it stands, marketers paying high fees don’t entirely understand what the value of the collaboration is.
“It’s essential that marketers question influencer fees and use attribution tools to measure the effect of this activity in order to create strong, value-driven relationships between brands and influencers,” he commented.
According to the study, less than a third of marketers (29%) think influencers they are in business with are concerned about their content driving sales for the brand. Greater transparency and better reporting of influencer contribution were pinned down as the factors that would encourage marketers to invest more in the channel the most (50%).
The lack of a better measurement system also seems to be an issue. The study revealed there’s a low adoption of more advanced attribution models and 60% of marketers don’t use one to assign credit for sales coming from influencer marketing. For those who do, the go-to solution is equal credit rewarding all touch points the same each time (26%), with marketers also favouring last and first clicks (21% and 24% respectively).
Collins believes that awareness is tricky to measure but solutions are getting “more sophisticated”.
“Tools now exist to help brands measure how awareness impacts sales, and to reward them on that basis, taking the understanding of performance beyond simple ‘reach’,” he commented.
In reality, however, only 11% of marketers use more advanced systems that can take the touch point closest to sale, and the same number use position-based models, which means 40% of the credit is assigned to first and last interactions.
Although the collaboration between marketers and influencers is yet to be perfected, Collins believes that the potential gains it may bring are worth the effort; “Ultimately, creating value-based relationships between brands and influencers – that benefit both parties – means long-lasting and fruitful partnerships,” he concluded.
Experts will tackle the challenges of influencer marketing and measuring ROI at the Influencer Marketing Show, co-hosted with PerformanceIN Live in October. View the full agenda here.