How Dropshippers Can Compensate Instagram Influencers

Trixia Barrientos

Trixia Barrientos

5 min read

Influencers can help grow your dropshipping business in many ways.

 

Influencer marketing is a tried and tested strategy that brands use to increase brand awareness and drive up sales. This form of marketing is an option that more and more dropshippers want to explore. However, the notion that Instagram influencers charge high fees for their services make dropshipping business owners hesitate in dealing with them. Afterall, dropshippers have smaller money to invest in advertising and marketing compared to eCommerce businesses.

Working with a limited budget has been an issue that many dropshippers face. If you’re dropshipping products with a small budget, you’d want to make as many returns for your investment as possible. Although this is difficult to achieve at the early stages of the business, some dropshippers were able to do it but the vast majority have to spend more money on ads for weeks and months before they started getting results.

Aside from running ad campaigns, influencer marketing is one of the strategies that can help dropshippers acquire customers. Instagram influencers can do the following:

  • Create a widespread buzz about your business on social media to promote brand awareness.
  • Increase conversions by posting engaging content about your dropshipping products and responding to commenters.
  • Reach a niche audience that would be interested in your products.

 

Image via Instagram

 

There are several types and formats that influencers can promote your dropshipping products on Instagram including:

  • Link in Bio
  • Instagram photo and caption
  • Instagram slideshow of products
  • Instagram video such as teasers, behind-the-scenes, and more
  • Instagram contest or giveaway or contest
  • Instagram Story with swipe-up or poll
  • Brand takeover
  • IGTV

 

However, influencers will only collaborate with a business or brand in exchange for compensation. The compensation depends on the popularity of the influencer and the marketing goals you want to achieve for your dropshipping business.

 

Do influencers always expect financial compensation for their services?

Image via Instagram

 

Not always. There are instances that influencers accept non-monetary compensations from brands. This is something that both you and the influencer have to agree upon when creating the contract. To ensure that the process will run smoothly and both you and the influencer can reap all the benefits, boundaries and regulations should be set in an official influencer agreement.

If you don’t have the money to pay influencers there are other incentives that you can offer them to convince them to work with you. Yet, never assume that they’ll be happy to promote your products in exchange for exposure in your networks. They have bills to pay and will not be swayed by the promise of “exposure” unless you have the best product and you have more Instagram followers than them.

 

How to compensate influencers?

Image via Instagram

 

As a dropshipper, there are two types of compensations that you can offer influencers: monetary and non-monetary. Monetary compensation means you have to pay influencers the specific amount they set for a range of marketing services. These can either be a fixed amount or a certain percentage of your net proceeds. Meanwhile, non-monetary compensation can be any of the following:

 

Product Samples

If you’re dropshipping products in the clothing niche, you can send the influencer product samples that she can use to create content. The influencer will then own the samples you sent her and will not ship it back to you.

 

Lifetime Discounts

Lifetime discounts to any dropshipping products you sell can make influencers work with you. If they believe in the quality and benefits of your products, they would appreciate the perks of buying goods from you for themselves or as gifts to someone at discounted prices for life.

 

Branded Swag

Everyone loves swag. Swags are promotional items or giveaways customized to carry your brand’s name, logo, and other branding assets. They are used to spread awareness about a brand or as a way of saying thanks to people who have helped in growing it. Shirts, mugs, baseball caps, sneakers, and jackets are just some of the swag ideas that you can run in small batches for your influencers.

 

 

You can incentivize influencers with either monetary or non-monetary compensation or both. The compensation depends on how much you are willing to spend on influencer marketing. Just remember that the better your compensation package, the better influencers you can get. Here are the dos and dont’s of incentivizing influencers:

 

  • Don’t overpromise compensations to influencers.

If you have set a budget for influencer marketing, stick to it. Avoid agreeing to very generous terms and promising them too much as you might paying them more than you can afford.

 

  • Do offer influencers more than your product.

Influencers will likely work with you if you offer them more than just free products. They might like freebies but they might not be interested to continue posting about them over and over again. Sweeten the deal by combining incentive ideas

 

  • Do understand the influencer contract.

Be very clear with the terms in your contract especially with the compensation clauses. As you will be consulting a lawyer with the preparation of the contract, make sure that you and the influencer have the same interpretation of the relevant clauses to prevent disagreement. Layout all the rules around the content like the quality and frequency so you will surely get what you paid for and will not be paying for more.

 

  • Don’t renege on your agreement.

If something comes up during the execution that is not favorable to you, don’t backpedal your way out of your contract. Explain your position, admit an error,  and try to come to a compromise with the influencer. Renegotiate and revise the contract if necessary to avoid the same situation to happen.

 

  • Do pay influencers on time.

Many Instagram influencers are easily put off by late payment. Don’t make them wait for months to get their compensations. If circumstances warrant the late payment, make sure that you inform them about the delay and how long should they wait for payment.

 

Key Takeaway

Influencer marketing can provide massive returns if executed correctly. Influencer compensation is just some of the costs associated with it. Yet there are several ways to compensate influencers you can explore if money is a constraint to you at this stage in your dropshipping business. Just make sure to have the terms clearly stated in your contract with the help of a lawyer to avoid future disagreement. Small investments in the right influencers can have huge payoffs which you’ll enjoy in the months and years to come.

 

Want to learn more about dropshipping?

How to Find the Right Influencers for Your Dropshipping Business

How Buying Facebook or Instagram Likes Impacts Your Dropshipping Business

How to Effectively Sell Your Dropshipping Products on Instagram

Trixia Barrientos

Trixia Barrientos

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