How Chinese Influencers Calculate Their Fees

Influencer marketing is considered an essential component of luxury marketing in China, but to many brands’ surprise, influencer marketing isn’t cheap and can actually be more expensive than the same service in the West. On top of that, it can be hard to know if you’ve been quoted a fair price since new platforms and types of content are constantly emerging. While there are a number of websites and resources that list average influencer prices based on the influencer’s popularity and the platforms they post on, those prices are generalizations, and a multitude of additional factors come into play where you can negotiate with an influencer. It’s helpful to know these six key factors that KOLs consider when setting their prices and deciding if they should work with your brand. Understanding these factors — and the KOL’s point of view — can help brands understand when they might be able to negotiate a lower price while also creating a harmonious situation for both parties. 1. Your brand’s reputation Large, well-known international brands that already own high brand awareness in China generally have more room to negotiate with KOLs than niche brands or those that are new to the market. Why? Because a larger brand already has an established reputation, and that makes the KOL’s job easier. Consumers already have some level of trust and, therefore, will be more easily influenced by the KOL’s content. And for micro or mid-tier influencers, collaborating with well-known brands satisfies their vanity and heightens their own reputation. 2. Whether or not the product clearly fits their niche If your product is closely related to the KOL’s area of expertise and is a natural fit, it will be easier for them to create content surrounding it. What’s more, their audience will already be receptive to that content, and the influencer will have to do less to ensure the post performs well. While they may be able to create content about products outside of their niche, it takes a lot more effort and they will risk a backlash from their audience if they appear to be “selling out.” In those cases, they are likely to charge more. 3. The item’s cost In general, luxury brands willing to gift a product have an advantage when it comes to negotiating content prices. Depending on the cost of the item and the prestige of the brand, KOLs may be willing to barter with the brand, sometimes even forgoing a fee entirely or providing a steep discount if it is an item they covet. If the item must be returned after the campaign or the influencer has to create content purely based on images, the cost will likely be much higher. 4. Content format requirements This depends on the platform, but in general, certain types of content take much more effort than others, thereby costing more. For example, photo posts on the social media and e-commerce platform Xiaohongshu (aka Red) tend to cost less than video posts. That’s because the videos are limited to 60 seconds in length, meaning that KOLs must figure out a way to communicate a lot of information and convert fans into customers within a short time frame. And unlike Weibo and Douyin, where video posts are typically accompanied by short text descriptions, videos on Xiaohongshu often have lengthy 500-1,000-character articles underneath them. 5. Requirements for how the product must appear in the content Content that is all about one product or brand appears less natural, and KOLs must work harder to generate trust with their viewers, as opposed to a post that integrates a product with other products. For example, it is highly unlikely that a fashion influencer would suggest to her followers to dress themselves head-to-toe in only one brand, so combining a brand's items with other pieces to create a look will come across as more authentic. On Xiaohongshu, some of the most popular posts are those comparing products with similar items from different brands, such as five different protein powders. While the KOL might ultimately recommend readers purchase one specific protein powder, it will make a more realistic argument if he or she can explain why it is better than the competition. 6. KPIs Expectations and requirements for campaign results may also affect how much the influencer charges. Success measured by click-through rates and driving sales typically puts much more pressure on the KOL than brand awareness related to KPIs, such as impressions or engagement, as long as the brand has realistic expectations. KOL marketing in China is rightly expensive, as the KOLs put in a lot of time and effort to produce their content and develop their audience. But if you understand what factors KOLs consider when putting together their price quotes, you can ensure that your brand isn’t spending more than it should on this invaluable service.

How Chinese Influencers Calculate Their Fees

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Published April 03, 2019

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How Chinese Influencers Calculate Their Fees