Working with Influencers - commercial terms question.

[GNewland]

Hello,

We are looking to work with influencers in the UK to help us market our product*.

As far as I can tell there seems to be two commercial models such a relationship can take. Either a simple payment from the brand to the influencer for an agreed number of posts. Any terms etc can be applied. Alternatively the second model seems to be an affiliate one where the influencer gets paid on the number of sales their posts generate either through the use of discount codes that track this or similarly an affiliate link that embeds a cookie and tracks it.

Both of these approaches seem to have issues. The cash up front option puts all the risk onto the brand, and the second puts this risk, and the risk of non tracking, onto the influencer.

I wanted to ask anyone with experience in this area whether they thought influencers might be open to work on a different basis. On a % of total sales basis. i.e. where we, the brand, agreed to give a small % of sales to the influencer on a long term agreement. We would look to do this with a small number of influencers each within different areas. Each influencer would get a small % share of total sales.

This approach has obvious issues (not least influencers free riding off of others, scalability etc). However, I feel am aware of these and instead I would love to hear from people experienced in working with influencers (in particular those on Instagram) in the 40k - 400k follower sort of range as to whether they thought influencers might be interested in such an arrangement.

Any insight / thoughts appreciated.

*The Brickle is a unit of furniture for children that sorts and stores their LEGO collection. (Brickle.co). It is a high end product made in Wales.

 

[Paul Kelly ICHYB]

So, the influencer would get a % of everything?

The active/successful ones would be subsidising the lazy ones and your other marketing activity!

 

[paulears]

The snag with any kind of turnover related commission is that if their popularity wanes, they still get money for nothing - it has to be tracked so you can monitor success.

 

[Ozzy]

Each influencer would get a small % share of total sales.

My first immediate thought is to avoid this; as the downside you already mention, as does Paul above, is too significant to carry - in my opinion.

I have been paid to make social posts, and take part in webinars off the back of social posts, and I've also experienced working (well, trying to) work with influencers. Based on those experiences, I would suggest something in the middle of your first two options.

A small, cover some basic small hourly rate, to engage in some social activities. Not posts, posts don't achieve anything really, you want "Lives" and discussion, product unwraps sort of thing in video format. Pay for that, and ensure you have rights to use that content yourself on your own socials, marketing and website - that is why you pay for it, as you buy the rights to use it - you cannot really get that if you don't pay for it.

Then do give the influencer their own landing page with tracking, and you and they want to know and feel confident this tracks properly. There has to be trust and transparency, you need to know it works for your own business metrics but also the influencer needs to know you are using a proper tracking method for the sales they bring - and then they only earn commission on sales they generate.
You want influences who will genuinely use your product; relevant to your product and your taregt customer. So the influencer will use it all the time, it will be seen in many of their posts, and their audience ask in chat or comments 'What's that widget you got there, looks handy' and so on.

That's my tuppence and how I'd suggest approaching this based on being on both sides of the fence.

 

[GNewland]

C

The active/successful ones would be subsidising the lazy ones and your other marketing activity!

"

The snag with any kind of turnover related commission is that if their popularity wanes, they still get money for nothing - it has to be tracked so you can monitor success.

Paul Kelly.
Yes - you're right. This is what I refer to in my original post as the 'free rider' problem. However, it would not be an agreement for life. The posting activity, engagement and popularity of the influencer would be measured and the agreement would be modified accordingly - or ended. (was the idea).

Paulears - Yes -tracking would be nice. But at the moment - the alternative is zero tracking it seems. Its more a case of just handing over £5k and 'hoping'. That is unless you want to go down the affiliate link/ discount codes route - which none of the influencers active in premium markets seem (understandably) to want to do.

My issue is that as a 'new venture', I don't really just want to shoot £5k and hope. I'd love to have something where the risk of success was at least part shared.

 

[Lucan Unlordly]

I know a couple of influencers.....
One has close on 200,000 followers and could be seen promoting relevant products on mainstream TV a couple of times a month. The shows format was tweaked and the section removed. The impact on sales would have been considerable.

The biggest problem as I understand it is time. Finding time to create worthy content when you're receiving countless offers - samples in the post - emails messages etc., The easier you can make it for the influencer to get involved, the less they are likely to demand in commission.

 

[Paul Kelly ICHYB]

Why not offer a hybrid return?

Pay them a little to get them onboard and/or create content and then pay a commission on their referrals?

 

[GNewland]

Thank you Ozzy, - and everyone.
Two thoughts.
1. I should maybe go and speak to a talent agency of some sort. Or get an advisor. I can see that my lack of time on Instagram could mean a waste of money. - E.g. I haven't seen a 'live' on Instagram before but I can envisage that for selling this would be far more impactful than a post.
2. Yes - potentially a dedicated landing page is a route around the difficulty of tracking. Again, the issue for me here is that when viewers change devices this attribution gets lost. Say if they went to my main website later on their laptop, after having viewed the 'live' on their mobile. The only way around this being discount codes - which I hate/ seem cheap.

 

[fisicx]

where can I buy your storage unit? Is it available on a range of online souks? Will I find it in shops like John Lewis? Are you running adverts in lifestyle magazines? Have you told the newspapers about your product? Have you spoken to Lego UK?

There are many other ways to market the furniture. An influencer should be a supplement to all the above.

Also….

A search for Brickle returns a whole load of results that aren’t you.

 

[GNewland]

where can I buy your storage unit? Is it available on a range of online souks? Will I find it in shops like John Lewis? Are you running adverts in lifestyle magazines? Have you told the newspapers about your product? Have you spoken to Lego UK?

There are many other ways to market the furniture. An influencer should be a supplement to all the above.

Also….

A search for Brickle returns a whole load of results that aren’t you.

Hello Fisicx,

You can buy the unit at Brickle.co - our website.
It isn't available in online souks(?), and you won't find it in John Lewis. We are aiming to sell it direct to consumer. At least for now.
We aren't running adverts in the lifestyle magazines (yet) but will be beginning print and digital media outreach shortly.

Yes, not appearing higher in search for the name of our product is an issue, however our website is relatively new ( 5 weeks) and our domain authority low. Generating backlinks and other means by which we will appear higher on search is underway.

Yes, an influencer will (hopefully) be a part of our selling strategy - not the whole. Apologies if I intimated it was the only thing we were planning.

G

 

[fisicx]

It isn't available in online souks(?), and you won't find it in John Lewis. We are aiming to sell it direct to consumer.

That's only going to work if people are looking for high end lego storage.

We aren't running adverts in the lifestyle magazines (yet) but will be beginning print and digital media outreach shortly.

Excellent.

Yes, not appearing higher in search for the name of our product is an issue, however our website is relatively new ( 5 weeks) and our domain authority low. Generating backlinks and other means by which we will appear higher on search is underway.

Nope. That's not going to work. SEO no longer relies on backlinks. And domain authority is an irrelevant measure. Content is what Google wants to see. There is almost zero keyword relevant content on your site. But this isn't a website review.

Your marketing budget needs to be sizeable. A £1650 Lego box suggests an investment many times this amount. The only time I got involved with an influencer (promoting shoes) their starting fee for £5000.

 

[Paul FilmMaker]

Hello,

We are looking to work with influencers in the UK to help us market our product*.

As far as I can tell there seems to be two commercial models such a relationship can take. Either a simple payment from the brand to the influencer for an agreed number of posts. Any terms etc can be applied. Alternatively the second model seems to be an affiliate one where the influencer gets paid on the number of sales their posts generate either through the use of discount codes that track this or similarly an affiliate link that embeds a cookie and tracks it.

Both of these approaches seem to have issues. The cash up front option puts all the risk onto the brand, and the second puts this risk, and the risk of non tracking, onto the influencer.

I wanted to ask anyone with experience in this area whether they thought influencers might be open to work on a different basis. On a % of total sales basis. i.e. where we, the brand, agreed to give a small % of sales to the influencer on a long term agreement. We would look to do this with a small number of influencers each within different areas. Each influencer would get a small % share of total sales.

This approach has obvious issues (not least influencers free riding off of others, scalability etc). However, I feel am aware of these and instead I would love to hear from people experienced in working with influencers (in particular those on Instagram) in the 40k - 400k follower sort of range as to whether they thought influencers might be interested in such an arrangement.

Any insight / thoughts appreciated.

*The Brickle is a unit of furniture for children that sorts and stores their LEGO collection. (Brickle.co). It is a high end product made in Wales.

We've worked with influencers. Well, we're video production so filmed influencers for our customers and are currently contracting an influencer who'd be well known enough that most people would've heard of him.

So the models are whatever you can negotiate. We've worked with influencers who've given great reviews for expenses. Or product.

Another, someone we trust, prices herself at £500 per post. She's an ex-professional premiership rugby player. A further woman is the CEO of an insurance business, played rugby for her country and you could get her at £5,000 for an interview.

And it also depends on platform. So a YT influencer with 50,000 followers is way more valuable than a Tiktokker with the same following on that platform. The price difference is enormous.

The 'influencer' our customer paid most for was the number 1 scientific Ted talker and that was a 100 grand single payment. I recently worked with one you'd definitely know and her fee was a one-off £47.5k to help to promote a business. That was for 90 minutes of her time. And incidentally, our customer was really angry because she was rubbish.

So it really depends what you're trying to achieve. For example, if you're in the electronics market, influencers with 2,500 - 7,500 followers on YT would probably just review your product for free if you just sent it to them. They'd already have their own, affiliate links with Amazon so if your product's on Amazon, they'd get already be getting a %.

Then there are fake influencers out there. One guy we know in the film industry bought his followers and off the back of that, has enough credibility that he gives seminars, gets paid to review products etc... but in the background, all the pros who have worked with him treat him like a joke.

So you're asking a 'how long is a piece of string' question. If you want more of a steer, just DM me and I can help answer questions because we deal with them all the time.

 

[AlanJ1]

Hello Fisicx,

You can buy the unit at Brickle.co - our website.
It isn't available in online souks(?), and you won't find it in John Lewis. We are aiming to sell it direct to consumer. At least for now.
We aren't running adverts in the lifestyle magazines (yet) but will be beginning print and digital media outreach shortly.

Yes, not appearing higher in search for the name of our product is an issue, however our website is relatively new ( 5 weeks) and our domain authority low. Generating backlinks and other means by which we will appear higher on search is underway.

Yes, an influencer will (hopefully) be a part of our selling strategy - not the whole. Apologies if I intimated it was the only thing we were planning.

G

Off topic to your opening question.

Curious on how your launch has been. Avid lego fan, multiple builds and pieces and I think yuor idea for product here is great however I would never justify the price point on them (and I understand that they are quality or look of top end quality). Not sure if this market is really there (I may be wrong) for this type of thing?

 

[fisicx]

I’ve still got a big box of Lego. Comes out for the grandkids. Half the fun is trying to find a green 2 by 1. Not sure I’d need a sorting thing.

 

[GNewland]

We've worked with influencers. Well, we're video production so filmed influencers for our customers and are currently contracting an influencer who'd be well known enough that most people would've heard of him.

So the models are whatever you can negotiate. We've worked with influencers who've given great reviews for expenses. Or product.

Another, someone we trust, prices herself at £500 per post. She's an ex-professional premiership rugby player. A further woman is the CEO of an insurance business, played rugby for her country and you could get her at £5,000 for an interview.

And it also depends on platform. So a YT influencer with 50,000 followers is way more valuable than a Tiktokker with the same following on that platform. The price difference is enormous.

The 'influencer' our customer paid most for was the number 1 scientific Ted talker and that was a 100 grand single payment. I recently worked with one you'd definitely know and her fee was a one-off £47.5k to help to promote a business. That was for 90 minutes of her time. And incidentally, our customer was really angry because she was rubbish.

So it really depends what you're trying to achieve. For example, if you're in the electronics market, influencers with 2,500 - 7,500 followers on YT would probably just review your product for free if you just sent it to them. They'd already have their own, affiliate links with Amazon so if your product's on Amazon, they'd get already be getting a %.

Then there are fake influencers out there. One guy we know in the film industry bought his followers and off the back of that, has enough credibility that he gives seminars, gets paid to review products etc... but in the background, all the pros who have worked with him treat him like a joke.

So you're asking a 'how long is a piece of string' question. If you want more of a steer, just DM me and I can help answer questions because we deal with them all the time.

Paul,
Thanks for taking the time to answer so thoroughly. I'm coming to the conclusion that we arent yet ready for an influencer to come on board. We need to build more content of our own on out instagram so that we have credibility when/(if!) the influencer then is successful in getting people to come and visit. I may be back in touch in a few months!

 

[fisicx]

We need to build more content of our own on out instagram….

Are your potential customers looking on instagram for products like this?

Near us is a big lifestyle barn type place full of expensive stuff. The sort of place where a set of placemats cost £99. It’s always busy and people spend lots of money. This is the sort of establishment where you need to pitch your products.

As an aside, if I’m coughing up £1600 on a Lego box I don’t expect to be paying shipping. You might want to rethink this on your website.

 

[GNewland]

Off topic to your opening question.

Curious on how your launch has been. Avid lego fan, multiple builds and pieces and I think yuor idea for product here is great however I would never justify the price point on them (and I understand that they are quality or look of top end quality). Not sure if this market is really there (I may be wrong) for this type of thing?

Hello Alan,

At the moment we haven't really 'launched' in the sense of promoting the business. Yes the website is open but we aren't yet actively marketed the Brickle whilst we sought out how and where we best do this. So although we have sold a few I dont feel we have really managed to credibly test the market.
As you say they're very expensive for the average family. We hope - one day, to change that, however making something affordable is an incredibly expensive process and takes a commitment level I cannot make just yet!

What they do do, with the children who've used them, is change how these children actually play with their LEGO. Kits are more readily broken up - rather than sat on shelves. Creative building is in - and instructions out.

That is the key element of the Brickle. It encourages creative building over just instruction following. Something we think is at the heart of what LEGO was originally intended for.

sorry - i'll come down off the soap box.

 

[GNewland]

Are your potential customers looking on instagram for products like this?

Near us is a big lifestyle barn type place full of expensive stuff. The sort of place where a set of placemats cost £99. It’s always busy and people spend lots of money. This is the sort of establishment where you need to pitch your products.

As an aside, if I’m coughing up £1600 on a Lego box I don’t expect to be paying shipping. You might want to rethink this on your website.

Ouch! - Shipping is free but I've been battling with the Shopify template all morning to edit it to more clearly indicate this.

To your original point - Going via 3rd party distributors is definitely an option - in time. Obviously they too need their margin. So an expensive unit becomes more so. That was our idea of trying to go D2C but then we need (as you've said) to have a strong array of marketing approaches to then convert.

 

[Paul Kelly ICHYB]

Going via 3rd party distributors is definitely an option - in time. Obviously they too need their margin. So an expensive unit becomes more so

This is a classic issue where your pricing is restricting you to direct sales, which is a major effect on the ability to grow the business. This is not an uncommon issue for direct importers who launch new products at the lowest price, which can kill the product before it is out of the gate.

You now have to find a way to reduce production costs by 30-50%! Or increase your pricing further to allow retail margins (30-50%!)

 

[fisicx]

Ouch! - Shipping is free but I've been battling with the Shopify template all morning to edit it to more clearly indicate this.

Don’t use shopify. You are marketing a lifestyle product. You can’t sell it as you would a pair of socks.

A change of direction in your website structure and content would reset all of sorts triggers and make you much more attractive to buyers and potential marketing channels.

This is one of those moments when you should consider getting external help. @Paul FilmMaker could do wonders for you.

But get rid of shopify. It’s the wrong platform. And seriously rethink the brand name - you are fighting too many competitors.

 

[AlanJ1]

But get rid of shopify. It’s the wrong platform.

Can you explain why you think this?

There so many premium brands on Shopify, and they are signing up even more in the luxury sectors every day.

 

[fisicx]

Can you explain why you think this?

If you were a premium brand selling a wide range of designer products that has a strong online retail sector then shopify could work. But not the cheap version, they will be paying thousands per month for shopify plus.

You aren't in that space. You don't even need to be an online store. You are a purveyor of bespoke high end products. Each one built for the customer, delivered and installed..... You get the idea.

This means you build a website that promotes the experience of owning, sorting, learning and so on. You have videos of the product being used. You show the craftsmen making the units. You talk about the wood from the sustainable forest.

Sell the sizzle not the sausage.

 

[AlanJ1]

This means you build a website that promotes the experience of owning, sorting, learning and so on. You have videos of the product being used. You show the craftsmen making the units. You talk about the wood from the sustainable forest.

And every single part of this can be done in Shopify though? (just like it can in most web platforms). That was more of where I was coming from.

 

[fisicx]

And every single part of this can be done in Shopify though? (just like it can in most web platforms). That was more of where I was coming from.

Ah, see what you mean. And yes you can but there are better ways to do this.

My main point was that you don’t need a shop. You may get more leads by not having a shop.

 

[DontAsk]

This is a classic issue where your pricing is restricting you to direct sales,

This. if you are serious and want to grow the business, allow for retailers to make a profit.

Also plan for exceeding the VAT threshold and what effect that will have on margins.

 

[Paul FilmMaker]

Paul,
Thanks for taking the time to answer so thoroughly. I'm coming to the conclusion that we arent yet ready for an influencer to come on board. We need to build more content of our own on out instagram so that we have credibility when/(if!) the influencer then is successful in getting people to come and visit. I may be back in touch in a few months!

My pleasure and happy to help. If you want to chat, just ping me and happy to discuss.

And I've just seen you're lego. Bizarrely, Lego influencer network is... extremely challenging.

You have the Lego Ambassador Network (LAN) and then you have the Lego Master Network. The infighting makes the Iranian regime look like a teddy bear's picnic.

There's a video from the most respected Lego influencer about this craziness: https://www.youtube.com/watch?v=uRMvhk11jyM

But again, happy to give you a steer through this to make life a bit easier.