Many marketers recognize the impact that influencer programs have in amplifying a brand's reach, increasing brand awareness, and generating sales. When it comes to paying out those influencers, there are many options—each with different benefits.
With impact.com, you can pay out influencers based on any number of your custom parameters and your choice of special terms. You may even decide to incorporate multiple payout types and incentives within your program depending on your goals.
This guide walks through three common types of payout structures along with some tips on incentives that can help you optimize your influencer partnerships for success. Most of the terms outlined below can be set up in Contracts → Template Terms.
Read more about the most common types of payouts and incentives below to decide which options could work best for your Brand.
One of the most utilized terms for influencer partners is a fixed payout on each action. This means that you would offer your influencers a fixed dollar amount to be paid out per action. An action can refer to a variety of leading actions that help you meet your goals. An action could be a sale, a newsletter subscription, an app install, or a signup for a free trial.
If you set up a fixed payout of $5 per sale and an influencer makes 5 sales, you would pay that influencer a total of $25 for those 5 sales (no matter the value of each sale).
Fixed payouts make things simple for you and your partners since you know exactly how much you will payout your influencers for a given action. If an influencer is set to get $5 per sale, you will payout the same $5 whether the order value was $10 or $100. This helps simplify planning, since you can calculate the total amount of sales needed to achieve your revenue goals.
Make sure to calculate a fixed payout dollar amount that is enticing to influencers and correlates with their audience size. A celebrity influencer may decline a low dollar amount, whereas a micro-influencer might be satisfied with a smaller payout offer. You can always customize multiple template terms to align with each influencer segment based on audience size and engagement rate.
To learn more, see the help article Create Template Terms.
Instead of offering a fixed payout on each sale, it might make more sense for your brand to offer influencers a commission-based payout on each action. If your brand sells products or services where prices vary greatly or have a limited budget for influencers, a commission-based payout will benefit both you and your partner by aligning the payout directly to the value of each order.
An influencer makes a $200 sale, so you give them 10% (or $20) of that order's value as a commission for making the sale.
For a brand, there is little risk to a commission-based payout structure which makes this option appealing, but while the risk is relatively low for brands, the risk is higher for the influencers involved who have to take the time to create and schedule posts without the guarantee of a payout. For this reason, influencers will often request free product or services in conjunction with a commission-based payout model. We'll cover free-products in more detail below.
To learn more, see the help article Create Template Terms.
Sponsored Posts are highly regarded, as well as highly requested, in the Influencer arena. In these cases, you would negotiate a fixed fee with each influencer directly in exchange for a specific promotion, much like a paid placement on a website, or a set of deliverables, such as photography assets.
You negotiate with an influencer who agrees to post an Instagram Story featuring custom images of your brand's products for $500 in advance. In this scenario, the best method of payout would be issuing the partner a bonus using a Partner Funds Transfer in the Finance section of your impact.com account.
Sponsored posts are a great way to get the ball rolling on a new influencer partnership by showing influencers that you are willing to invest in them when they put in the time and effort needed to promote your brand to their audience.
Popular influencers will usually have media kits or rate cards available, and are willing to negotiate their rates or create custom promo bundles that include email blasts and multi-platform posts.
To learn more, see the help article Transfer Funds to a Partner.
Incentives are a big part of influencer partnerships and can be competitive between brands, especially depending on the vertical. Below are some of the popular forms of incentives used in influencer programs today.
Free Product is key. An influencer's audience values their opinion; without a service to test or a product to photograph, the influencer's promotions could lose authenticity and fall short of expectations.
If you sell a product or service that you want an influencer to promote, expect to give them free product or free usage of your service, in addition to the payout terms set. According to eMarketer**, 69% of respondents to a 2018 survey on Influencers reported free product or service as the main compensation model utilized.
You might also see requests for free products to be gifted in audience giveaways or as prizes in contests. Giveaways and contests are great to increase the social hype around your brand using audience participation, in addition to being a low-cost way to please your influencers.
Nano- and micro-influencers frequently participate in “seeding programs” where you can send them free product in exchange for sharing a review, photo, or post on social media. You can easily set up a seeding program using impact.com's ACTIVATE platform, which has an extensive network of influencers who will apply to participate.
Placement fees are great incentives to activate your influencer partners. In impact.com, Placement Fees refers to pre-set payouts you can create using Template Terms. You can easily create placement fees alongside any of the terms outlined above in your Template Terms section.
A placement fee incentive could include a payout for accepting the offered terms, an additional payout on the first event, or even a monthly payout if they are regular promoters.
Placement fees for each month are applied at the conclusion of the month with an action date of the last day of the month. Placement fees are paid at the same time as commissions for other event types on the same contract. In cases where there are multiple event types in the contract, placement fees will follow the schedule that results in the latest payout date.
A contract with Roadrunner's Rockets might include an Online Sale/CPA event type with an action locking period of 5 days after the end of the month in which they are tracked and a payout scheduling period of 10 days after the action locks. Placement fees would follow this schedule, locking 5 days after the end of the month and paying out 10 days after they lock.
Placement fees are great to boost a new partnership and activate an influencer that has just joined your program, or show appreciation for a partner that regularly promotes your brand.
To learn more, see the help article Create Template Terms.
The benefits of using vanity promo codes are multi-faceted; influencers can offer an exclusive discount to their audience, encouraging conversion and brands create a low-risk way of testing which influencers are high converters. This is a great incentive to utilize before moving top-performers onto a commission-based agreement.
Vanity promo codes are a great low-cost incentive to offer your influencer partners, and can even give your brand a slight competitive advantage over brands that do not offer vanity codes.
Influencers love promo codes that incorporate their social handles or any wording that is relative to their own brand. It makes it easy for their audience to remember and can help avoid lost sales over confusion and mistaken code entries. Plus, Influencers are all about aesthetics, and a general promo code with strings of letters and numbers won't look nearly as nice and clean as a simple promo code that incorporates their name or social handle instead.
To learn more, see the Guide to Setting Up Promo Codes.