Christopher S. Penn – Marketing AI Keynote Speaker

How to calculate your social media influencer value

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Christopher S Penn
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“I would do this for free, but I make you pay so that you understand the value of what you are getting.” – Mike Lipkin via Mitch Joel

C.C. Chapman had a great podcast the other day about valuing yourself and your time as an influencer, particularly in social media. I wanted to build off his conversation by giving you a benchmark for how to calculate your value.

The monetary value of your social media influence starts with your current pay. After all, it’s the fairest price estimate of what the market is willing to pay for you. Here’s how to calculate that on an hourly basis. If you’re salaried, take the total sum of salary and benefits and divide by 2080. (52 weeks x 40 hours per week) This gives you your hourly rate. If you’re an independent contractor, self employed, or hourly worker, calculate the same way – use your 2008 taxes and expenses to judge the total cost of your self-provided health insurance, income, etc.

Once you know your hourly rate, whatever it is, you understand your current market value. If a company sends you a product for review on your blog and it takes you an hour to review it, its value had better exceed your hourly rate or you’re losing value. You’re giving away more value than you’re receiving, because theoretically, you could be working for your current employer at the same rate.

When a corporation approaches you about helping them with their campaign, you must know your hourly rate as a baseline to judge whether or not something is worth doing. As C.C. said in his show, sometimes you’ll work for no monetary compensation in lieu of exposure, reputation, or other non-monetary currencies. That’s fine. You don’t have to charge your friends, but you must know the value of what you are giving them, especially if they’re representing a company in their request. For example, if Scott Monty asked me to put up a blog post about an automobile, he may know me as a friend, but he’s asking on behalf of a commercial account, and whatever comes with the request had better be valued at my hourly rate or I’m losing value.

Think about what value your personal web site provides. Check out similar sites with similar PageRanks, traffic, and reputation, especially commercial sites, and determine what an ad costs to place on those sites. If a commercial entity comes to you and asks you to display a badge on your blog, know what they’d pay on other similar sites (use Google Ad Planner and Compete.com, for example) and judge whether you’re getting that value from the company in exchange for your efforts.

The reason we have so much trouble with social media ROI begins with not having any idea what our value is. Use some of the points in this post to start assessing your own value, and you’ll have the beginnings of understanding what the ROI of your social media influence is.

How much money are you leaving behind?

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Comments

16 responses to “How to calculate your social media influencer value”

  1. Steve Sherlock Avatar
    Steve Sherlock

    Well done Chris, this goes along nicely with the posting I did recently on the job for pay quadrant. Start with the quadrant, figure out where you want to change from 'no revenue' to obtaining revenue, then using the calculations you outlined above, you can appropriately target your value opportunities!

    BTW the post can be found here: http://steves2cents.blogspot.com/2009/09/job-se…

    Reply
  2. stevegarfield Avatar
    stevegarfield

    Nice post. I tweeted it out for you.

    No charge. 😉

    Reply
  3. C.C. Chapman Avatar
    C.C. Chapman

    WELL said Chris and I couldn't agree with you more. This is something I meant to talk about on the show but obviously forgot to bring up so thank you for doing so.

    I'm really hoping that people realize that they do have a value and just like you said there is an easy place to start with figuring it out as outlined above.

    Reply
  4. DJ Francis Avatar
    DJ Francis

    I listened to C.C.'s podcast just yesterday and was planning on listening to it again today. This is a great post and really important to think about.

    But I'm reminded of my grandfather saying, “Something is only valuable if someone's willing to pay for it.” I feel like us up-and-comers are still going to be giving away the goods for free until we reach a certain threshold. But I guess that's kind of true in every profession.

    Reply
  5. Christopher S. Penn Avatar
    Christopher S. Penn

    Oh, I definitely think we need to do more research and invest more time in understanding the value of non-monetary currency, which is what that threshold is. Once we have a reliable idea of the value of reputation, trust, etc., we can then accurately peg whether an effort is worth it or not.

    Reply
  6. TimWalker Avatar
    TimWalker

    Good post, sir. I would make one caveat: for many people, it's too easy — and hides too many variables — to peg their salaried hours per year at 2,080.

    An obvious tiny adjustment would be to subtract three weeks of paid vacation, during which you collect pay but don't work. That moves the number to 1,960.

    A non-obvious major adjustment is to calculate the *real* number of hours you work per week, including *any* time that you're doing work-related things instead of doing something you'd rather be doing — or instead of something else that earns you money. For many professionals, this number easily tops 50 hours per week, even though they're technically on the hook for only 40. At the higher number, the raw total for 50 weeks is 2,500 hours, which significantly changes the hourly rate.

    Bigger picture: lots of folks don't net nearly as much as they think they do from their work, because they don't genuinely account for *all* the time they put into the job.

    Reply
  7. Steve Sherlock Avatar
    Steve Sherlock

    Well done Chris, this goes along nicely with the posting I did recently on the job for pay quadrant. Start with the quadrant, figure out where you want to change from 'no revenue' to obtaining revenue, then using the calculations you outlined above, you can appropriately target your value opportunities!

    BTW the post can be found here: http://steves2cents.blogspot.com/2009/09/job-se…

    Reply
  8. stevegarfield Avatar
    stevegarfield

    Nice post. I tweeted it out for you.

    No charge. 😉

    Reply
  9. C.C. Chapman Avatar
    C.C. Chapman

    WELL said Chris and I couldn't agree with you more. This is something I meant to talk about on the show but obviously forgot to bring up so thank you for doing so.

    I'm really hoping that people realize that they do have a value and just like you said there is an easy place to start with figuring it out as outlined above.

    Reply
  10. DJ Francis Avatar
    DJ Francis

    I listened to C.C.'s podcast just yesterday and was planning on listening to it again today. This is a great post and really important to think about.

    But I'm reminded of my grandfather saying, “Something is only valuable if someone's willing to pay for it.” I feel like us up-and-comers are still going to be giving away the goods for free until we reach a certain threshold. But I guess that's kind of true in every profession.

    Reply
  11. Christopher S. Penn Avatar
    Christopher S. Penn

    Oh, I definitely think we need to do more research and invest more time in understanding the value of non-monetary currency, which is what that threshold is. Once we have a reliable idea of the value of reputation, trust, etc., we can then accurately peg whether an effort is worth it or not.

    Reply
  12. Vanessa Oler Avatar
    Vanessa Oler

    Excellent piece — timely, too! Thank you.

    Reply
  13. TimWalker Avatar
    TimWalker

    Good post, sir. I would make one caveat: for many people, it's too easy — and hides too many variables — to peg their salaried hours per year at 2,080.

    An obvious tiny adjustment would be to subtract three weeks of paid vacation, during which you collect pay but don't work. That moves the number to 1,960.

    A non-obvious major adjustment is to calculate the *real* number of hours you work per week, including *any* time that you're doing work-related things instead of doing something you'd rather be doing — or instead of something else that earns you money. For many professionals, this number easily tops 50 hours per week, even though they're technically on the hook for only 40. At the higher number, the raw total for 50 weeks is 2,500 hours, which significantly changes the hourly rate.

    Bigger picture: lots of folks don't net nearly as much as they think they do from their work, because they don't genuinely account for *all* the time they put into the job.

    Reply
  14. TimWalker Avatar
    TimWalker

    Good post, sir. I would make one caveat: for many people, it's too easy — and hides too many variables — to peg their salaried hours per year at 2,080.

    An obvious tiny adjustment would be to subtract three weeks of paid vacation, during which you collect pay but don't work. That moves the number to 1,960.

    A non-obvious major adjustment is to calculate the *real* number of hours you work per week, including *any* time that you're doing work-related things instead of doing something you'd rather be doing — or instead of something else that earns you money. For many professionals, this number easily tops 50 hours per week, even though they're technically on the hook for only 40. At the higher number, the raw total for 50 weeks is 2,500 hours, which significantly changes the hourly rate.

    Bigger picture: lots of folks don't net nearly as much as they think they do from their work, because they don't genuinely account for *all* the time they put into the job.

    Reply
  15. Vanessa Oler Avatar
    Vanessa Oler

    Excellent piece — timely, too! Thank you.

    Reply
  16. Vanessa Oler Avatar
    Vanessa Oler

    Excellent piece — timely, too! Thank you.

    Reply

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