When Is It Acceptable to Pay Influencers?

If and when brands should pay influencers remains an unresolved issue in marketing circles. Marketing and PR often wonder if consumers will distrust the message if they pay influencers to post content about their brand.

Influencer marketing is clearly a powerful strategy. Bloggers, video producers or celebrities with huge numbers of followers who respect their opinions can increase a brand’s reach exponentially. Research shows that consumers trust influencers more than other sources except friends and family. That’s why PR and marketing teams strive to persuade influencers to mention their brands and review and showcase their products.

Will brands paying influencers negatively affect consumer perceptions and diminish influencers influence?

To discover how influencers feel about the issue, influencer software provider GroupHigh surveyed over 5,000 influencers. It found that many brands pay influencers for mentions and most influencers want to be paid. Most influencers believe it’s fine to accept payments – with important qualifications. They must maintain their own voice in paid posts, and brands they work with must match their style and their audience’s interests.

Mark Hinchliffe of MotorbikeWriter put it this way: “I never ask for payment for a post, but if an advertiser asks for a sponsored post, I have a fee. As a veteran motorcycle journalist I am often given free samples (to keep or return) and my reviews are always honest. If not, I wouldn’t have 230,000+ monthly readers.”

Key Findings

• Almost 85% of influencers accept monetary payments for posts, according to the survey. About 11% don’t and almost 4% accept only products.  On average, a mid-level influencer charges $200 to $500 per post.
• Almost 70% of influencers believe their audience does not question their authenticity when they produce content labeled “sponsored” or “paid” post.
• About a quarter believe they are being fairly compensated by brands, but 44.4% believe they are not and 30.9% are not sure.

“Influencers tend to agree that when they write content about a brand and are open in their transactional relationship with said brand, their audience understands and trusts their opinions. When an influencer tries to bury the fact they are compensated by the brand, audiences become distrustful,” wrote GroupHigh Manager Kristen Matthews for Social Media Today.

How to Work with Influencers

GroupHigh offers these tips on developing an effective influencer marketing program:

• With the proven effectiveness of influencer marketing, marketers may wish to re-evaluate their investment priorities. Marketing dollars now allotted to traditional or online advertising may be more effective if dedicated to influencer marketing.

• Nurture influencers and create an ongoing relationship with them. The editorial content that results from building PR-type relationships with influencers is more trusted by consumers.

• Make sure influencers you work with disclose the nature of the marketing relationship they have with your brand. (The Federal Trade Commission (FTC) Endorsement Guides, based on truth-in-advertising principles, say marketing connections must be revealed if the connection would affect how consumers evaluate the endorsement or other type of product mention.)

• When communicating with influencers about the type of post you want, be clear about your goals so they provide input on the best ways to reach their audience.

• Let influencers know they are valued. The key is open lines of communication to ensure relationships are healthy and mutually beneficial.

Will Influencer Marketing Wane?

Even though most influencers appear confident they can run paid posts and maintain authenticity, some observers fear influencer marketing may wane as more brands adopt the strategy. Paid placements, they contend, will cause audience cynicism to grow.

“The more brands use influencers for marketing campaigns on social platforms like YouTube, Twitter or Instagram, the less impact each influencer has,” writes Sydney Ember of The New York Times.

Some online viewers were cynical when Ricky Dillon, creator of fun online videos and a social media star with millions of followers on YouTube, Twitter and Instagram, posted a photo of Coca-Cola cans on Instagram. One asked if the photo was a paid advertisement. It was.

Dillon said he is now more selective about brand endorsements “That is still a big concern for me,” he told the Times. “I pass down a lot of brand deals.”

Bottom Line: Paying influencers is a tricky balancing act. Although most influencers accept payments, the marketing strategy can backfire if not handled properly.