How to measure ROI in influencer marketing

The return on investment for influencer marketing has reached levels much higher than those of returns on traditional marketing techniques. It may not always be very straightforward to measure ROI though. A large number of marketers feel that measuring ROI on influencer marketing is one of the most difficult parts of the entire process. In this blog, we’ll share tips on how you can create an effective plan for measuring influencer marketing returns. 

Set up a separate budget for the campaign

Before you even proceed to launch your influencer marketing campaign, you need make sure that you design a dedicated budget for the influencer marketing campaign. This should ideally be part of a larger marketing plan created specifically for your brand’s influencer marketing effort. Having a separate budget is crucial for you to be able to  compare the payoffs with the original investment.

Set clear objectives for your influencer marketing campaign

Before launching your campaign, your marketing team needs to plan out exactly what it wants to achieve from the campaign. These goals can include improving your brand awareness, increasing sales volume, entering a new target market, boosting the brand’s reputation or enhancing social engagement. Whatever, the goal is, it needs to be clearly quantified. For instance, if your aim is to increase sales, then specify by how much. SImilarly, define a clear timeline for each goal.

Determine the tools to be used for each objective

You can use a variety of metrics depending on the type of goal you want to achieve. For example, if your goal is to increase sales, you can directly track the number of times a discount/promo/QR code was used to make a purchase. Similarly, if you want to increase engagement, you need to keep track of the likes and comments on your posts after launching your campaign. Or, if your aim was to increase website traffic, you can use tools like Google Analytics to monitor that.

Start calculating!

The general formula for calculating return on investment is the same for all types of campaigns and tools: (gain from campaign - investment in campaign) / investment in campaign. You can tweak this formula according to each metric you are observing. For calculating the ROI for the engagement goal, you can use cost per engagement to get an idea of how much you had to spend for each interaction. This will be calculated as the total investment divided by the number of interactions (e.g. likes, follows, comments).

Engaging with an influencer marketing agency

Engaging an influencer marketing agency will make the job of measuring return on investment much easier. Your work will be cut down significantly and your brand will be able to save time for focusing on the important aspects of your campaign. 

Influencer Hub is an influencer marketing agency that helps bridge the gap between influencers and brands. Not only will it make the task of finding the right influencers much simpler, it will also allow your brand to keep track of how effectively your campaigns are generating returns. For both influencers and brands, Influencer Hub provides clear reports and summaries, showing metrics like the reach per campaign, reach per post, reach per dollar, as well as amount paid to influencers. These can allow you to keep track of the progress of your marketing campaign in real time and make the entire process effortless! To learn more about how Influencer Hub can help your brand, click here.