Not so long ago, the Uganda Marketers Association (UMA), in partnership with the Chartered Institute of Marketing (CIM), held an Ignite Session at Motiv on ‘Pay For Performance’ focusing on the issue of whether influencer payment should be tied to revenue generated for the client.
The Founder of Kahill Insights, Patricia Kahill, boasting over 20 years of experience in the Marketing and digital industry, and Robert Victor Nsibirwa, left participants with a lot to ponder. Here is my take on the issue;
For me, payment models for an influencer have no “one-size-fits-all”; it all comes down to what the strategy is and what the client needs to achieve from the campaign.
Is it simply awareness? Is it conversion? Are you looking at a more long-term engagement? What is the product anyways?
It all starts with and ends with the client (or their representative). They ought to know the product or service, what they need to achieve and why, and they can always figure out the how, sometimes with the chosen influencers. That will also inform the mode of payment. Upfront, as per execution or by commission are all ways of payment… a matter of fact, sometimes influencers don’t even need to be paid, especially in the instance of pre-existing relationships that are built over time or organically!
While influencer payments often come in the form of gifting or paying per post, there are other ways brands can pay their influencer partners to create strong, sustainable and long-term partnerships.
Here below are some of the quite many influencer pay-out formats;
- Performance-based results: Creating a scalable model with revenue-based rewards would be the best mode of payment for the better of both the client and the influencer. With this, influencers are paid per achieved KPIs set at the beginning of the influencer campaign.
- Gifting: This means incentivizing quality content creation to drive traffic and engagement with gifts. In a layman’s words, you create gift-offering content and let your fans, followers, and whatnot, spread the content further with the hope of getting a gift after. (I have seen Sage Buyers do this quite several times.) However, gifting may be combined with other partnership and payment agreements.
Pay for performance might be the most recommended mode of payment for most brands to choose and for most influencers to accept. This mode of payment is very suitable for brands looking to achieve engagement goals.
Do you want to compensate influencers based on the number of clicks, conversions, and revenue-driven to your site? Then paying for performance is your way to go.
When brands pay based on performance, they can structure their influencer payments around:
However, I have found that in Uganda today, many a brand will always choose the easiest way to pay influencers, either because they lack the right tools to track performance goals or lack the right people to head their digital strategy teams – digital is more than knowing how to operate a social media account. These brands will always choose the easy way out – deciding on a flat rate.
Deciding on a flat rate means that all influencers will be paid the same amount of money regardless of how many posts are created, how creative their content is, number of clicks, conversions, likes, shares, impact, impressions, and whatnot.
That said, a lot comes into play when choosing what mode of payment should be used to pay influencers. It is important to research and seek support from various marketing professionals or agencies before embarking on an influencer campaign(s).
The writer is Desire Derekford Mugumisa, Head of Corporate Affairs at Next Media