How to Set Rates So You Can Negotiate With Confidence
The number of influencers who don’t negotiate rates is alarmingly high. If you find yourself in this camp, you might chalk it up to being shy or the assumption that women aren’t good negotiators. But neither of those are true. You have trouble negotiating because you have no idea how much you’re worth. When you’re picking a rate based on what you read on an Instagram account or what your friend told you she makes, you’re going to have doubts about that number and rightfully so.
In general, you should be charging about 3-4% of your following, but if you want to negotiate with confidence and be able to back up your numbers, there are five components you need to assign a value to. Add them all up and that’s how much you charge. Ready? Let’s go.
Content Quality
This falls under “production” and takes into account your expertise on the subject, the level of photography/videography, and your ability to write a killer caption. To determine this rate, break out all the hats you’ll need to wear while producing the photo or video and charge hourly for each job.
Remember that if the brand hired an agency they would be hiring someone to mood board the concept, a stylist for wardrobe, hair, and makeup, a location scout, a photographer/videographer, a copywriter, an editor, and so much more. They get all of this in one powerhouse woman: YOU. Charge for it!
Strength of Your Platform
This falls under “distribution” and is where follower/subscriber count and engagement come in. It’s also where you apply the $100 for every 10,000 followers rule. But notice, it doesn’t stand on its own; it’s one of the five components that make up your rate.
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Length of Exclusivity and Usage
When you hear of influencers making six-figures for a campaign, this is the line item where you’ll find most of that money. When calculating your exclusivity, you need to take into account how much money you will lose by signing onto the campaign in front of you.
If you normally work with two shoe brands each month, and a footwear brand X asks for exclusivity, that revenue is now cut off. You would include this loss revenue (your rate for each campaign x2) in your rate for footwear brand X for each month they wanted exclusivity. If the brand is in a category where you don’t do a lot of sponsored work (i.e. sunscreen) you may want to only charge 25-50% of your total rate.
Usage works the same way. Although you can work with competitors, a competitor may not want to work with you if a company has essentially made you the face of their brand. This is what happens when they can turn your content into a social ad, use it on their website, or include in their newsletter.
This is why during holidays or big seasons (back-to-school for moms or January for fitness) influencers can charge a lot more. They will turn down more business and be taken out of the running for future campaigns with each brand deal they sign.
Audience Demographic
When a brand hires an influencer they are hiring you for content, but they’re also hiring you to reach your audience. Look at each platform’s audience insights and poll your audience on a regular basis. If you want to work with a moving company, find out what percentage of your audience plans to move in the next six months to a year.
If you want to work with your favorite TV show for the season premiere, find out what percentage of your audience watches the show. Regardless of your niche, this information on your audience is priceless and is something a brand can only find out from you. If your audience is super excited about something, that means they will support the content when you post it. That’s worth big bucks to brands, so bump up your rate.
Community Loyalty
Being an influencer is all about having, you guessed it, INFLUENCE. If your comments and DMs are full of followers telling you how much they loved a product you suggested, or they tried your recipe and it was even better than their mom’s, it shows they respect you and take your recommendations seriously. This is gold to the brands because it means you’ll convert. Bonus points if you have your commission on sale metrics for certain products or services you’ve promoted. This is another place you can bump up your rate because the brand you partner with is going to get more than just a great piece of content, they’re going to get customers!
It will take time and practice to master your fees for each component. But once you’ll do you’ll be ready to negotiate with confidence because you will know your worth.
Learn more tactical tips and tricks for your brand at BlogHer Biz, a virtual workshop series designed to help you turn your passion into profit. Register for free below and if you missed week one, press play on the above video to catch-up.