Paid Collaborations vs Influencer Gifting : Which strategy is better?
Influencer gifting and paid collaborations are two common strategies that brands use to promote products or services. Each strategy has its own benefits and drawbacks which we cover below.
What is influencer gifting?
Influencer gifting is when you send your product to a nano and micro-influencer for free, hoping that they will share it with their audience.
A micro-influencer is a content creator with a smaller but highly targeted audience, typically falling within the range of 10,000 to 100,000 followers. What sets them apart is their niche interests and content, as they often focus on a particular subject, industry, or skill, enabling them to build a highly focused and engaged online community.
Finding the right influencers for your gifting program requires two key considerations: firstly, ensuring they genuinely resonate with your brand, and secondly, making sure their content would interest your target audience. For example, if you’re a haircare brand, you’d look for influencers who create content about their hair routine and give recommendations on which products to use.
For example, Ryderwear focus on gifting nano and micro-influencers across Instagram and TikTok. Even with their small followings, these influencers actively engage with their audience and are more likely to achieve higher engagement rates.
For example, Ryderwear gifted nano-influencer @thelisagalway, a wellness coach, who has 1,700 followers on Instagram. Lisa has an engagement rate of 3% which suggests that she her content will resonate with Ryderwears target audience.
Benefits of influencer gifting
Cost effective: Influencer gifting is a cheap alternative, especially when you don’t have a big budget for influencer marketing. Developing an influencer program can not only help you increase your brand awareness, but it can also drive sales and lower your CPA
Authenticity: Unlike celebrities with millions of followers, nano and micro-influencers tend to have more engagement and a strong relationship with their followers. Because of their smaller following, they tailor their content towards a specific niche, making their product promotion come across as more authentic.
Community: Sending gifts can help establish a relationship with influencers, leading to potential long-term collaborations. By sending gifts to smaller influencers you eventually build a community of brand ambassadors who truly love your product and who are trusted by their followers.
Drawbacks to influencer gifting
Lack of control: Brands have less control over how and when the product will be featured by the influencer. There’s no guarantee that the influencer will like the product or even share it with their audience.
Limited reach: Gifting may not result in as much exposure compared to paid collaborations, especially if the influencer doesn’t prioritise sharing gifted products.
What are paid collaborations?
Paid collaborations involve paying larger influencers to create branded content on their social media channels. Larger influencers usually fall under macro, mega and celebrity-influencers with very broad target audiences. They typically fall within the range of 100,000 to over 1,000,000 followers, although some micro-influencers do charge for their content.
When running paid collaborations it’s important to:
- Make sure to create a contract
- Include disclosures like: #ad
- Use the ‘Paid partnership with‘ tag on your posts and stories
For example, Gymshark uses brand ambassadors. The brand chooses the most influential fitness influencers on Instagram and makes them its ambassador. Gymshark works on a paid collaboration with celebrity-influencer, Saffron Barker who has 1.8 million followers. Saffron’s post received nearly 200,000 likes on her Instagram post.
Benefits of paid collaborations
Guaranteed content: With paid collaborations, you’re guaranteed content, unlike Influencer gifting, where you hope that the influencer shares with their audience. In this case, the influencers must create content otherwise they will not get paid.
Creative control: Paid collaborations offers you creative control over the content. That means if you have specific content requirements or messaging you would like them to deliver, paid collaborations gives you that control. You can decide the direction of the content, then sign off before it goes live.
Drawback to paid collaborations
Expensive: Paid collaborations can be more expensive, especially when working with influencers with larger followings or higher engagement rates. Larger influencers can charge anywhere from £3,000 per post to £500,000 per post depending on the platform.
Authenticity concerns: Audiences may perceive paid promotions as less authentic and ungenuine compared to unpaid content. Users may think larger influencers are only promoting certain products for the money.
Broad audience: Larger influencers are good for raising brand awareness but due to their broad audience, their audience may not resonate with their audience as much as smaller influencers do. If your targets are to raise brand awareness, working with larger influencers are a great way to get your brand in front of an audience.
Overall, the choice between both strategies depends on budget and campaign objectives. Gifting products to nano and micro-influencers are a cost effective way to boost your sales and reach your target audience. If you’re looking to boost brand awareness and have a big budget, collaborating with larger influencers will effectively reach a larger audience.
If you’re looking to start your journey with influencer gifting, or would like to boost the performance of your campaigns please get in touch with matt@dyzio.co or simply book a call below with a member of our team to see how the platform works.