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Wednesday, November 18, 2015

Blogger Dilemma: Sponsored posts- how much to charge? My thoughts

It is no secret that almost all bloggers hope to generate some real money out of their blogs and there is nothing wrong with that. One main question every blogger has is "How much should I be charging for a commercial post?"  This post shares my thoughts on the concept of sponsored posts and making money out of blogging.

Though this post focuses more on bloggers, I am trying to balance all stakeholders- the brands who want publicity and business from blog readers, blog readers who want quality content and don't fancy being thrust upon with commercial posts and bloggers who hope to make some money promoting brands while not losing his/her readers by annoying them. Below diagram depicts the stake holders and whats the nature of interaction between each of them.
How much should you charge for a blog post? This depends on lots of parameters. Recently Naina made a video urging bloggers not to charge small amount like Rs 5000. Unlike a product or service sold to end consumers, Freelancing is a very tricky part. There is no published rate card. There is lots of confusion among bloggers as to what is the right amount to charge for their prospects- too high a quote, you may not hear from the prospect again, too low, you are losing potential revenue. This post shares my thoughts on the topic.

First question is “Is it ethical to blog for money?” “What happens to your credibility if you write sponsored posts?”, “Is it really possible to take money and still write honest content?”

Today we have reached a stage where opportunities are opening up for bloggers to make some money from their blogs. Brands are more willing to engage with bloggers and spend on this platform. 5 years ago this was not the scenario. While readership is great, readers do not pay. Just like print media or TV media, advertisements that are primary revenue and not what readers pay for newspaper or channel subscription. Bloggers will also have expenses- the value of time they spend on blogging, expenses on internet, domain, hosting, photography equipment and things like that. So a blogger shouldn't be blamed for an effort to recover these expenses through some commercial posts. Of course blogger may be unbiased but brands who pay want only positive message to be communicated. So like any other advertisements, negative aspects of a product or services won't get communicated in a sponsored posts. If done too often or if done for wrong brands, readers who trusted the blogger will get disappointed about the quantity/poor quality of commercial content dumped upon them and will slowly stop visiting the blog. So caution is required.

Now assuming we all agree that bloggers do need to make money, next question is what are the channels and how much. Most popular way is working with brands for sponsored posts/campaigns-on which this blog post is focused. Other ways include providing consulting services, writing book, providing content to others for a fee etc. This post will not cover these- not the focus of this post and nor do I have so much experience in all these.

So how much to charge for a commercial post?
Answer depends on lots of factors- such as
1. How popular you are and what kind of reach you can offer the brand?-higher the reach, higher the earnings.
2. How much your peers are charging and if you want to charge above the average and be choosy about your work, or quote less than average hoping for more volume.
3. How much of your time you are likely to spend on the post and related activities?- your time and effort should be fairly compensated
4. How much spare time you have- if you have very limited time, you can eliminate low value deals and focus on few high paying deals
5. What are the expectations from the post- how many words, how many links, pictures, social sharing etc
6. Potential future benefits- if any- of getting associated with a brand.
7. Social causes/Non commercial aspects you may want to consider

Step 1: First question is very tricky-how to decide your position in the ladder of popularity? It is same like movie industry- there are a few Big Bs and SRK who command several crores for few hours effort, where're newcomers who are struggling and there're middle tier guys who offer a middle ground in terms of reach and money. Applying same measures, where do you stand among other bloggers in your niche? Are you popular enough and have lots of reach to be counted as top 1%? or are you a nobody or are you somewhere in middle? This categorization would form primary consideration to decide how high or how low to charge.

How to decide this?
Lots of information like alexa rank, PR, DA, PA etc are in public domain. Simple google search will list popular bloggers in your area of blogging. Sitemeter or other traffic counters if available will give stats of the blog. Social media followers is another indicator. Occasionally published top blogger lists, things like Indirank etc will give you an idea. Using these, comparing your stats with that of your peers will give you an idea where you can position yourself among your peers (you don't have to tell anyone on this- it is only for your reference)- decide if you are in the top tier with best of the best bloggers or tier 2 (where most of the bloggers will belong) or tier 3(newbie).

If you are Tier 1 blogger then you may not need my advise-you would already be working with top brands by now and your focus will be to earn even more and work with even bigger brands, you might as well skip this post as I don't have much to offer. If you are in tier 3 (recently started blogging and don't have enough experience/traffic yet) I suggest you do not worry much about making money as yet- focus on growing your blog- read more and write more, get some readership and revisit this post after 3-6 months.

If you are in Tier 2-the middle class- blogging since few years, got decent readership, has been able to make some money occasionally and looking to earn more but wondering what is the right amount, then this post is for you.

Step 2: Second factor is to find an approximate market rate for your niche and reach. You need to find out how much others in your peer group- those having similar traffic and writing similar topic charge. Because if you charge too above average you will never get a response from brands and if you charge way low, you lose potential revenue. But how to find what others are charging?
  • Best option is to befriend them, gain trust and ask them. 
  • Other option is to take a look at platforms like Blogmint, where against everyone's profile, amount he/she would charge is shown. This may not be actual money he/she is making, but gives an idea of what they think is fair value of their blogposts.
  • Third way is to keep a close watch on the kind of campaigns bloggers participate- for example Indiblogger announces a campaign where all confirmed participants get Rs X coupon and winners get Rs Y. If a blogger participates in this, he/she thinks the amount is fair. (Someone who would charge Rs 10000 for a post is not likely to bother about a campaign that gives only Rs 500 reward)
There is never a perfect number and you will only be able to guess some approximate. That estimate number is good for us to go to next stage. You should decide if you want to stay above the curve, earn more with fewer but better quality deal or want to enter volume game- charge less but do more posts.

Step 3: If you have lots of time and not enough prospects at hand, you might probably want to grab everything that comes your way- if so you can quote at par or below average to increase your chances of winning. But remember that more the volume, more the time spent in follow up (for payment, closure etc), less is the quality of work and more annoyed your readers will be. So best thing is to stay slightly above average, leave low value deals for less popular bloggers and grab few but better paying tasks. This will help push the bar higher and eventually reach Tier 1. Remember there is always someone who can do same thing cheaper- so you should have a cut off below which you don't want to work.  Don't be greedy to grab every deal from Rs 250 to Rs 25000- it will dilute your offering. Stay within a price range you deem is your worth and try to push the bar higher.

Once you have a price point, you might want to increase/decrease them a bit based on below aspects
-Are you expecting long term association with the brand (reduce a bit)
-Negotiation margin- if the brand is likely to come back (keep a margin for this)
-Effort involved- Complex posts that need lot of research vs an easy topic
-How many links are you giving out?
-Value of pictures being used in the post
- Concessions for social causes you may want to support- if applicable
- Follow up effort- if the brand is not paying promptly you may want to quote higher
- Do you have enough liberty to draft and publish or will the brand be controlling every word? (suggested by Rajesh)


Taking following precautions while agreeing to a sponsored post
- Avoid topics which are too off topic to your blog's theme. It should be of some relevance/use/interest to your readers
-Avoid giving too many links- may not be good from Google's point of view. Don't recommend more than one and linking site should be sensible and useful, not some unknown/useless site
-Frequency of sponsored post- May be 1 paid post among 10 might be OK, but 6 out of 10 is just not OK. Don't  take your readers for granted and don't spam them testing their patience.
- Readers are smart- they will usually figure out that a post is sponsored within few paragraphs- some upfront declaration is still recommended
- Maintain a rate bracket- Do not charge Rs 10000 to one brand because they could afford and Rs 2000 to another brand who bargained hard. Just like you network with other bloggers, those managing brands also network. So if you rip off someone and give undue discount to some one else, you will lose the high paying brand forever. I think 10-20% variation based on various factor is Ok.

I hope this helps. I am not recommending any rate card- that is for you to figure out- how much is your time, effort and blog is worth. Successful bloggers also invest a part of money earned from blogging back into blogging- in better design/hosting, in promoting their blog, attending events, visiting cards and portfolio and so on. So keep aside a part of your revenue to spend on promoting your blog.

Do share your thoughts. Criticism welcome.

Also read; A decade of my blogging- SWOT Analysis * Start-up funding crisis and impact on bloggers *

18 comments :

Prasad Np said...

Good analysis as always... now if you would also define Tier I, !! and III with some numbers :)

Arun Prasadh said...

Nice details. Thanks.

Mridula said...

I entirely agree on having a threshold below which one will not work! :D

Nisha said...

Good analysis. Threshold is very important and it also sends a message to prospective clients that bloggers should not be taken for granted.

I wish you had mentioned the average rates to help the ones who want to venture in this area and not undercharge themselves. :)

Destination Infinity said...

I look at how much creative freedom a brand offers to me, and what topics they want me to write about. If I am fine with these, I don't bother with the amount. I don't mind charging way lesser than the minimum amount listed by you as long as the sponsors don't expect my blog to turn into another marketing billboard for them.

Destination Infinity

Shrinidhi Hande said...

@Prasad: Thanks. I don't have clear numbers for Tier 1,2,3.. typically in your area of expertise, if you are among top 5% or 10% then you can consider yourself Tier 1

@Rajesh: Good point. I have updated post with credit.

@Nisha: Thanks, but after much deliberation I felt there is no right and wrong price- there're too many factors and it is best to leave everyone for their own final call. Blogmint profile is an indicator of how much most wish to charge.

@Mridula: Thanks

@Arun: Thanks

Ranjana's craft blog said...

Good details...I used to think a lot on "the charges" :) Thank you

Shrinidhi Hande said...

Thanks Ranjana

D.Nambiar said...

So nicely put together, Shrindhi.
Your points are so well organised. A lot of food for thought for bloggers.

Shrinidhi Hande said...

Thanks DN

divsi said...

extremely useful article! reminds me of the conversation we had!

Shrinidhi Hande said...

@Divsi- yes. Hope you got that deal

Najm Nisa said...

This post was an eyeopener for me dear.. very helpful ..thank you! :)

Shrinidhi Hande said...

You are welcome. Glad many of you found this useful

R Niranjan Das said...

Helpful analysis, Shrinidhi.

Shrinidhi Hande said...

Thanks Niranjan

mahesh said...

Excellent post Srinidhi - you have covered the dilemma clearly.

Thanks for sharing.

Regards,
Mahesh

Shrinidhi Hande said...

Thanks Mahesh