How to determine ROI of Influencer Marketing

You know that influencer marketing is one of the fastest-growing marketing trends. You know that influencers can help you reach a much larger audience, increase your credibility and trust as a brand. And you know that influencers can help you strengthen your brand. However, what is often difficult to measure, or anticipate, is the ROI or return on investment from influencer marketing. The good news is that there are tangible ways to determine ROI of influencer marketing.

1. Set Performance Indicators

KPI or Key Performance Indicators are essentially predetermined metrics that you want to achieve with your Influencer Marketing. For example, you might want to track clicks through from the influencer post to your website.  You might want to track engagement or comments or sales. As with any marketing strategy and tactics, you want to make sure to set your goal before you begin planning and implementing your influencer marketing.

2. Coupon Codes

Coupon codes are an exceptionally easy way to track response and ROI. You can give your influencer a coupon code to use in their posts. Whenever their code is used, you can attribute that action or sale to your revenue tracking and determine their return on investment. For example, if you pay an influencer 10K to post a 4 part campaign and you make 11K in revenue your ROI is 1K. Plus you’ve expanded your reach, increased awareness, and strengthen your brand. 

3. Predetermined Amount of Time

You can also set your influencer campaigns to run during a specific period of time. For example, you might have them create 3 posts over the course of 48 hours. Then for every sale or action taken during that time frame, you can attribute it to the influencer and calculate their ROI. This method requires you to not run any other marketing efforts during this period of time and there may be some overlap over time.

One of the benefits of social media marketing is that it can generate results over time. It’s not unheard of for your influencer’s post to create a sale several months after their post. Just take these things into consideration before planning your influencer marketing campaign and setting your goals.

Bottom line, set goals and KPI. Create systems to track and measure those KPIs and then work with the influencer to make sure the technology supports tracking. Subtract the cost of working with the influencer from the revenue you gain from their posts and you have your return on investment. Tracking clicks, using coupon codes, or limiting their posts to a specific amount of time can help make measuring ROI easier.