How to Allocate Your Marketing Budget for Influencer Campaigns

Influencer marketing can feel like a tightrope walk. You’ve got to put enough money into it to make it work, but you can’t forget about your other marketing efforts like email, social media, and paid ads. This guide is here to help you figure out how to juggle it all and get the most out of your influencer marketing budget.

How much of a budget do brands need for influencer marketing?

Statista estimates that in 2024, the market is estimated to reach $24 billion. Influencer marketing is experiencing impressive growth, but brands want to know how it equates to their budgets. 

Marketing budgets vary by company and are often divided into a handful of different efforts. So, how much money should be allocated for influencer marketing? 

Share of marketing budgets spent on influencer marketing

Research from Statista shows what percentage of budgets brands set aside for influencer marketing. According to the chart, 26% of brands set aside more than 40% of their budget. However, about 50% of brands invest 10-40% into influencer marketing (when you combine the three middle columns).

Platforms brands plan to invest in

Which platforms are brands investing in, specifically? Research from Insider Intelligence shows Instagram is the most popular platform for influencer marketing spending in 2024, followed by TikTok, YouTube, Facebook, and Snapchat.

Cost per piece of sponsored content

By examining IZEA’s 2023 State of the Influencer Earnings, you can see the average cost of content for Facebook, Twitter, Instagram, Pinterest, YouTube, TikTok, and Twitch. 

As you can see, Facebook is the most affordable type of content, costing an average of $642 per post. Prices increase from that point, reaching $4,373 for Twitch content. Video-based platforms, like YouTube, TikTok, and Twitch, cost more than static content. 

Cost per influencer tier

While the cost per piece of content is a good place to start, costs can shift based on the influencer’s audience size. Creators with larger audiences earn more per post, while creators with smaller audiences earn less.

The State of Influencer Earnings report shows the average cost per post based on an influencer’s tier or audience size. A nano influencer, with 1K-10K influencers, earns about $1,000 per piece of content, while a web celebrity with 1M+ followers earns around $6,000 per piece of content.

Factors that can adjust cost

Audience size, as mentioned, can impact costs, but other factors increase or decrease influencer rates, including engagement, industry, usage rights, and exclusivity.

Engagement rate

The average engagement rate hovers between 1% to 3%, but influencers with higher engagement rates may have higher rates. 

Usage rights

Unless otherwise negotiated, influencers own the content that they produce, even if it was produced for your brand. If you’d like to use the influencer’s content beyond the campaign, you’ll negotiate that into the contract and often pay for usage rights, which adds a flat fee to the overall cost. You’ll pay a certain amount to use the content for a certain period of time, like six months. 

Exclusivity

If your brand asks an influencer to be exclusive, meaning the influencer won’t work with your competitors for a defined period of time, it could cost more. Rates vary, but essentially, an influencer is willing to turn down potential work to collab with your brand, so expect additional costs. 

Understanding the costs involved in influencer marketing

There are a series of costs associated with influencer marketing: Influencer fees, production costs, and agency fees. 

For some brands, costs start and end with the influencer fees, which is the money you’ll pay an influencer for content. However, you might also pay production costs or management and agency fees. 

Production costs come into play if you’re working on a fairly big campaign. If you plan to bring influencers together to shoot a video in your studio, for example, you could see additional costs. Production costs could include studio time, videographers and editing time.

If you work with an influencer marketing agency or a team that helps you plan and execute influencer campaigns, additional costs are added.

Having the right payment structure

There are several ways to pay influencers for their service. Some offer the potential to make your budget go further.

• Pay on delivery: You agree a fixed rate for the content with the influencer and pay on delivery. 
• Net 30, 45, or 60: Many brand-influencer deals are paid after a period of time agreed upon in the contract. The agreement often will state that the creator cannot delete or remove the content before this time period ends.
• Results-focused payment: Some influencers like to be paid based on performance. Methods for measuring performance include the number of likes and shares or the number of sales generated. Affiliate marketing falls into this category.
• Payment in goods: Some influencers, especially brand advocates and nano- or micro-influencers, may be happy to take on a project to receive early review products or access to free services. They use the sponsorship to get products they want and to build their own audience. 

How to determine your influencer budget

Consider these steps to help you put a number into your influencer marketing budget. 

Set KPIs

Each influencer campaign needs identified KPIs that you’ll reference during and after it. Get specific with your goals. For example, your goal might be to drive a 20% increase in social engagement, quantified by mentions, likes, and shares. 

Understand your audience

To effectively spend money, you need to reach your target audience. Ensure you have a keen sense of your market, audience and your follower’s content preference. 

Evaluate potential influencers

When you have a shortlist of influencers you’d like to work with, reach out to each one and discuss the campaign and rates. Weigh their rates against their audience size, experience, content quality and engagement rates. 

Consider the content and platform

The content type and platform you choose can also impact your budget. As mentioned, influencer rates are often higher for video content than static content, so keep that in mind as you plan your campaign and budget. 

Allocate your budget 

To allocate your budget, consider these steps:

Find the right influencer

The influencer you choose has a direct impact on your ROI. You want a creator who: 

• Has experience in your niche
• Shares your brand’s mission and tone
• Has a good online reputation
• Produces high-quality content
• Has a solid engagement rate
• Has experience with influencer campaigns  

To find an influencer, you can tap loyal customers or employees, search for influencers in your niche on Google or the platform you plan to use, like Instagram or YouTube, or use an influencer marketing platform. 

With izea.com, you can search a robust database of creators, narrow your results, and review influencer profiles. You can also create Casting Calls to invite influencers to apply to collaborate. 

As you select influencers, you can choose creators with varying audience sizes. If you work with a few micro-influencers and a few macro-influencers, you can stretch your budget further while working with many creators.   

Using content in ads

If you decide to use influencer-generated content in an ad, you’ll need to budget for it. Whether you plan to boost content occasionally or invest ad dollars into each campaign, plan accordingly. 

Strategies to maximize your influencer marketing budget

Every brand wants to ensure they not only spend their marketing dollars well but are able to get the most bang for their buck. Here are tips to do that:

Consider long-term relationships

Rather than working with influencers once, establish a long-term relationship. By doing so, you eliminate the time it takes to search for and vet another influencer. You also develop rapport with your team, making it easier to launch campaigns. 

Repurpose the content

In the influencer contract, you’ll negotiate terms for content usage after the campaign. Have a plan in place to repurpose the content. Aside from resharing it on your social channels, get as much mileage out of it as possible. Share it in your newsletter, include it in a promotional email with a special discount, or add it to your website. 

Leverage user-generated content

You can also gather user-generated content from your followers. Run a contest, for example, asking followers to submit a photo of them using your product. By using UGC campaigns in conjunction with influencer campaigns, you can balance your budget and keep a steady stream of authentic content streaming in. 

Measure and adjust

Watch your metrics to keep your budget in check. Use your metrics to fine-tune your campaigns and squeeze the most out of your investment.  

Setting and allocating an influencer marketing budget requires careful planning, but each year, you’ll gain more knowledge to forecast your needs and invest wisely.

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Marketers:

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