How To Calculate Influencer Marketing ROI + What Is the Best ROI for A Campaign

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Influencer marketing is one of the most powerful advertising ways. And like every marketing method, you need to measure influencer marketing ROI so you can analyze its effectiveness.

It’s not surprising to know that influencer marketing platforms are growing rapidly and the market size is expected to surpass 22 billion in 2025. Therefore, as a marketer or a business owner, you need to know how profitable it would be to use influencer marketing for your campaigns.

Many influencer marketplaces help you to calculate the return on investment. Ainfluencer is a 100% free influencer marketplace that helps you find and collaborate with the best influencers on Instagram and TikTok to maximize your ROI. There are more than 500,000 influencers ready to collaborate with you.

What is influencer marketing?

Influencer marketing is a form of marketing that focuses on using key individuals to drive the message of a brand or product and promote it. In other words, Influencer marketing is using influencers on social media to represent your products or services to their followers.

These influencers can be anyone from celebrities or bloggers to regular people with a large number of followers on Instagram, TikTok, YouTube, Snapchat, Twitch, etc. When using this strategy, one of the most important things to do is to measure the influencer marketing return on investment.

Read more: Best influencer marketing strategies to try

What is influencer marketing ROI?

To measure how successful an influencer marketing campaign was in achieving its objectives you need to calculate the return on investment of the campaign. It’s essential to know how much value you are getting for the amount of money you are paying to influencers.

How to measure ROI of influencer marketing?

Even though the return on investment depends on lots of criteria, the formula for calculating influencer marketing ROI is quite simple. The ROI formula is (revenue – total cost) / total cost x 100.

Influencer marketing ROI formula

For example, if your total cost for your influencer marketing campaign is $5,000, and it generates $6,000 in profit, the influencer marketing return on investment for that campaign would be:

($6000 – $5000) / 5000 x 100 = 20%

In this influencer marketing campaign, the brand has generated 20% profit which is a very good start. In addition to the immediate revenue, the brand has increased its reach on social media which may result in increased referral customers and brand loyalty known as word-of-mouth marketing.

Importance of measuring influencer marketing RO

So, as mentioned before, influencer marketing has become a powerful tool in today’s digital age. However, with great power comes great responsibility, and it is important to continuously measure the ROI of influencer marketing campaigns to ensure their success. Tracking this information helps you to:

  • Determine whether the campaign was successful in reaching the company’s goals.
  • Calculate the actual money gained from the return on investment of advertising campaigns.
  • Identify which aspects of your campaign are working well and which parts need some improvement.
  • Determine how much money you should put into influencer marketing spending for your future campaigns.

All in all, you need to measure and investigate all the available data to plan your marketing strategy. Studying the ROI of influencer marketing can be vital for your business growth if you consider the potential of social media to increase sales and revenue.

Limitations of current methodologies

It has been obvious that influencer marketing can be an effective way to reach a target market. However, there are some limitations to this methodology.

One of them is the difficulty of determining the influencer marketing ROI. You can track how much traffic an influencer sends to your website or your social media account, but that’s not always a clear indication of whether or not the campaign was successful.

Even if you see an increase in website visits, you can’t be sure whether that’s directly influenced by the influencers involved in the campaign.

Secondly, influencer marketing campaigns can be expensive. Depending on how you work with influencers, you could end up spending a lot of money on sponsored posts, paid ads, or other promotional activities.

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And the last problem is that it can be hard to identify the right influencers for a particular campaign. To have a high influencer marketing ROI campaign, you need to find influencers related to your business and high engagement rates. The easiest way for searching influencers is to use marketing platforms such as Ainfluencer.

Ainfluencer

Ainfluencer is a free, DIY influencer marketing platform that helps you find the perfect influencers for your Instagram and TikTok marketing campaigns. Being 100% free and DIY means that you are only paying for influencers fees and no additional cost will be taken. This way, Ainfluencer helps you to increase your ROI even more.

Ainfluencer

You can filter influencers based on follower count, location, language, niche, gender, quality of the followers, etc. Moreover, Ainfluencer’s escrow payment system protects parties in financial transitions and guarantees a safe collaboration.

Tools for measuring influencer marketing ROI

If you don’t want to calculate ROI by hand, There are several different tools to help you measure influencer marketing ROI. These ROI calculators can be divided into two categories:

1. Web Analytics

Web analytics tools can help you track how many people saw your campaign, how many people clicked through to your website or social media page, how many people converted into customers, and more.

These data can help you determine whether or not your campaign was successful, and it can help you make better decisions about which influencers to work with in the future. These tools can track how well the campaigns are performing concerning your goals.

For example, suppose a business is hoping to increase website traffic through influencer marketing. In that case, they can use web analytics tools to track the number of visitors who came from each influencer’s link and compare that with the overall traffic goal.

One of the most popular web analytics tools for measuring influencer marketing return on investment is Google Analytics. There are also other tools such as Spring Metrics, Woopra, Adobe Analytics, etc.  All of these tools allow you to track website visits, page views, and unique visitors, as well as goal conversions and eCommerce transactions.

2. Social Analytics

Social analytics tools allow businesses to track and measure the performance of their social media campaigns and quantify the influencer marketing ROI or return on investment.

Several different social analytics tools are available, each with its own strengths and weaknesses. Some popular options include Hootsuite and Sprout Social. Each tool offers a variety of features, such as the ability to track engagement levels, impressions, likes, hashtags, and comments on various social media platforms.

What is a good ROI percentage for marketing?

After calculating your influencer marketing ROI, you should see if it’s a good and acceptable number for your business or not.

Generally speaking, a reasonable ROI for most businesses would be around 5% to 7%. However, any ROI above 10% would be ideal. So, if you invest $1000 on one campaign and profit $1100 or more in return, you can call it a success.

You should remember that if you use the right influencer marketplaces, collaborate with the best influencers in your niche, and analyze the data for each campaign, you’ll improve your ROI every time you investigate influencer marketing. You can even reach to ROI of 20% in the first year of influencer marketing if you try a top-notch platform like Ainfluencer.

So, when trying to determine what is a good ROI percentage for marketing for your business, it is essential to consider all of these factors and tailor your calculations accordingly.

Conclusion

As a result, an effective influencer marketing campaign can significantly impact a company’s growth. There are several things that companies can do to measure their influencer marketing ROI and make sure their campaigns are as successful as possible.

One of the most important things is to carefully select the right influencers to work with. The influencers you choose should be aligned with your brand and have a large, engaged group of followers.

1. How do you calculate ROI of influencer marketing?

In general, for measuring your influencer marketing ROI, you need to determine your total marketing costs and your total profits generated from those marketing efforts. Once you have those figures, divide the profits by the costs and multiply by 100 to calculate your ROI percentage.

3. What is ROI influencer marketing?

Influencer marketing ROI, or return on investment, measures how successful your campaign was in achieving its goals.

Cyrus Nambakhsh

Cyrus is a serial entrepreneur, product-led-growth expert, a product visionary who launched 7 startups. He has built scalable platforms to help businesses and entrepreneurs. Contact: Cyrus@ainfluencer.com