How the right type of influencer partnership transformed this business

How the right type of influencer partnership transformed this business

If you’ve thought about trying to partner with influencers and get them to promote your products, you probably know it could have a huge impact on your business. New email subscribers, new clients, and new customers can come pouring in when you effectively partner with influencers.

But if you’re like many entrepreneurs, you don’t know how to get started. It feels daunting. And sometimes the hardest part is knowing what exactly you should ask for.

This is a question about partnership structure.

Before you can know what to ask for, you need to know what the ideal partnership would look like.

Would it be an affiliate partnership, where you pay a commission per sale? Would it be a content partnership, where you offer free content to your partner’s audience? Would it be a co-promotion, where you each promote the other’s product to your own audience?

Figuring out all these details requires that you understand your business structure and costs, your customer journey and sales path, and exactly what your goals are for a partnership.

But rather than diving into all the different options for partnerships, I want to tell you a story about one type of partnership.

This is the story about a client I worked with. I ran their partner marketing campaigns for about a year.

They don’t want me to share the details of their business, so I’m not going to share the name of the company, and I’m going to change some of the financial details.

Here’s what I will tell you.

The company sold a physical product in the lifestyle category. When I started working with them, they had sold it exclusively direct-to-consumer, which means they sold it through their own website. It wasn’t on Amazon, and it wasn’t in stores.

I’ll add (and this is very important, more important than most people give credit for): it’s a truly amazing product. The product was perfectly designed for a specific customer. The timeframe for its use was very short – there’s just one specific moment in a customer’s life when the product was perfect for them. Customers usually only bought one or two of the product, and they weren’t generally repeat customers.

When I started working with them, the company had established a strong foundation for their business. They had made a significant number of sales, and they had just received investor funds.

At that point, they had one simple growth system that worked very effectively. It was a partnership system build on social media. However, they didn’t want their entire marketing strategy to continue to be dependent on a single social platform. So they wanted to expand their options and find more marketing channels that worked for them.

I recommended that they focus on growing their email list, for several reasons.

First, because email isn’t dependent on any platform – it would enable them to connect with their customers directly and personally. Focusing your marketing solely on social channels is always risky, because you don’t own the platform, and the social media gods could shut you down at any time, for any reason, with no recourse.

Second, because even though the company only had one product with a short use life at that point, they were planning to create new products, so it would be valuable for them to be able to sell more to their past customers.

And third, because at that point email was their most underused channel. They had about 1500 subscribers on their email list, and all of them were former customers. There was no way to sign up for their list except by buying a product (you could check a box to subscriber at the time of purchase), and they rarely sent emails to their list.

So the company set the goal to grow their email list and increase their email marketing.

Since they have a great physical product, and they already knew their customer journey wasn’t complicated, I felt that giveaways were a good strategy for growing their list.

How we set up the giveaways:

  1. We made a list of target bloggers and publishers who had an audience of their ideal customer. All of these bloggers regularly ran giveaways on their blogs, and the sites averaged at least 5 comments per non-giveaway post. (The number of comments is one way to estimate the readership size and engagement level for a site. Domain authority and social media following are two other factors you can look at when determining whether an influencer has a big enough audience to make a partnership worthwhile.)
  2. We created an email onboarding sequence for giveaways. This involved a series of emails that people would get as soon as they signed up for the list. The emails would welcome new subscribers to the community, announce the giveaway winner, and then offer a coupon for giveaway entrants to buy the product.
  3. We reached out directly to bloggers who fit the profile and asked them to host a giveaway of the product.

As we began reaching out to bloggers, I always tried to negotiate for them to provide a free giveaway post, but many bloggers charge a fee for a review or a giveaway. At the beginning of this campaign, it was hard to estimate whether a fee was worth it, which is why tracking is important. Since our main goal was email subscribers, we tracked how many people signed up for our email list and compared that to the number of people who entered the giveaway contest. Over time, we were able to average the percent of people who usually signed up for the email compared to the number of giveaway contest entries. Then, as we were looking at new potential partners, we only needed to look at how many entries their giveaways had on average – and we could immediately estimate how many email subscribers we were likely to get from a partnership.

At first, it looked like the partnerships weren’t worth the money, because most giveaway entrants did not purchase during the onboarding sequence. Often, the cost of the sponsored review was more than the immediate revenue.

However, at the same time, we were growing email marketing. As we began regularly emailing announcements and discounts to the list, the revenue per subscriber became an important metric. After 9 months, the revenue per subscriber was $.50/month. Which means that even if we spent $12/subscriber, we would double that in revenue over the course of a year.

But for these giveaway partnerships, the cost per subscriber averaged just $.47.

Which means that as long as new subscribers stayed on the list for longer than a month, the partnerships were well worth it.

And over time, the email list grew into an asset that the company continues to use today to sell new products and stay in relationship with past customers.

At the beginning of this project, the email list was about 1500 people, and all of them were previous buyers and unlikely to buy again.

At the end of the project, after 9 months, the list was over 9000 people. The company was sending email newsletters once a week, and email revenue (i.e., revenue that came directly as a result of emails they sent, separate from other revenue) was $.50/subscriber/month (for a total of $4500/month).

Clearly, this partnership structure was very effective for them.

There are a few reasons why a giveaway structure was the right type of partnership for this business:

  1. Their customer journey was short and simple. In other words, customers didn’t need to learn a lot or know a lot about the product or the company before they were ready to buy. Most of them time, they just needed to hear about the product at the right time. Giveaways to the right audience enabled customers to hear about the product at the exact right moment, and so they resulted in immediate sales.
  2. Their long-term revenue and total email profit was greater than the cost of giveaways. Because every business and industry is so different, it isn’t possible to know for sure whether this will be true for your business until you test it. Just like advertising, giveaway partnerships are something you should be prepared to invest some money in upfront, before you know for sure what will work. However, you can also start by partnering only with influencers who are willing to host a giveaway for free, simply because it’s fun and valuable for their audience. If you do this, look for smaller influencers who frequently host giveaways. This will help you get some data about how well giveaways work for your business, and after a few of those, you can start to estimate what makes sense for you to pay.

If these two factors are similar for your business, then it’s possible that giveaways would be great for you, too! If not, take the quiz to find out what type of partnership would be best for your business.

Once you know what kind of partnership is ideal for your business, it will be much easier for you to reach out to influencers with a clear, specific statement about what you’re asking for.

And over time, as you continue to reach out to influencers and schedule partnerships, your audience, your revenue, and even your own influence will steadily grow.