There are two main types of influencer events. Awareness & Transactional.
In an awareness campaign your goal may not be to drive sales but to reach the maximum number of people and let them know your brand or product exists. You must decide how valuable awareness is to your brand or product as you cannot directly measure the results against sales. Here are some average CPM (Cost Per Thousand Impressions) for different advertising channels:
TV Commercials – $25 CPM
Radio – $4 CPM
Newspapers – $20 CPM
Facebook Advertising – $7.50 CPM
YouTube Advertising – $4 – $10 CPM
An average of 5% – 15% of an influencer’s audience will see a Post/Story. If an Influencer has 200,000 followers, this means you can expect around 10,000 – 30,000 people to see that post.
Most likely an influencer with the audience size of 200,000 will command anywhere from $1,000 – $3,000 for the post. This means you will be paying approximately $100 – $300 CPM.
This CPM is very high, but remember not all awareness if created equal. There is a huge value to having your brand or product introduced to someone from a person they know and like.
To get more value out of you awareness campaign with an influencer, you can take the content they created and repurpose it for your creative in Facebook and Youtube ads (You may even be able to target fans of the influencer for better results).
The goal of this campaign is to drive direct sales from the event. Typically with a transactional driven event, an influencer will drive 1-3% of their followers to your site. Of those, a good conversion rate would be 2% (the conversion rate from the influencer traffic will typically be slight better than your average conversion rate on your site).
Influencer has 200,000 followers
2% of their followers are driven to your site – 4,000 users
Of the 4,000 users 2% will convert and make a purchase – 80 Purchases
Now, calculate your average profit per order
Average Sale Price – $100.00
Average Cost of Goods Sold – $35.00
Shipping Costs – $10.00
Other Transaction Fees (Processing etc) – $5.00
Average Profit Per Order $50.00
If you get 80 purchases from the event you will receive about $8,000 in revenue and about $4,000 in profit.
To breakeven on the event you can pay the influencer no more than $4,000. However your goal is to not breakeven and you need to factor in risk of not hitting your estimated numbers.
If an influencer has very good metrics (see our article on influencer research) a good rule of thumb is to pay about $1,000 per 100,000 followers.
So based off our example, the recommendation would be to pay this influencer who has 200,000 followers around $2,000 for the event.
The numbers used here are just generalized averages. Depending on your product and the influencer you work with you can see 10x, 20x, 50x sales to influencer cost. However you can also see an event flop and lose money. That is why it is important to do your research and plan your event properly. Check out our complete guide to setting up an influencer campaign.