How Agencies Are Confronting the Influencer Pay Gap

The entrepreneurial spirit of the influencer economy—which allows normal people to catapult themselves into fame from the comfort of their own bedrooms—has evolved quicker than regulation can keep up with it, driving some creators forward while leaving those who already face systemic marginalization behind when it's time to get paid. According to Tiffany Hardin, CEO of consulting firm Gild Creative Group, when influencers of color start working with brands and reach the negotiation stage, they often feel they have no choice but to back down and settle. The space lacks open conversation and streamlined resources, leaving creators in the dark when naming their price. “There is a fear with Black influencers that saying ‘no’ could mean a ‘no’ for the next project, especially when you’re just a checked box and the person sitting in that seat doesn’t actually care about you,” she told Adweek. https://twitter.com/MissBeeBright/status/1476065837324943361 In December, MSL released a study that showed the pay gap in influencer marketing is significantly greater than other industries. According to the study, white influencers are paid 35% more than Black influencers, and the gap between white and other influencers of color is 29%. The lack of industry regulation impacts what agencies and brands expect to pay creators, as well as how creators value themselves. As the middlemen between brands and influencers, agencies can create a more equitable creator economy by teaching self-advocacy, filling positions of power with diverse talent and rejecting the notion that creators are defined by their Instagram follower count. Negotiation education According to Ali Grant, CEO of influencer marketing agency Be Social, to say that creators are shy about sharing their rates would be an understatement. “Unlike corporate America where you might have an understanding of what an assistant makes versus an account executive, our influencers keep this information very private,” said Grant. “I have influencer clients who are close friends who won’t share how much they’re making on a certain campaign.” This lack of awareness is a leading force in income inequality, and some agencies and platforms have taken the initiative to fill those knowledge gaps. Influencer marketing agency Digital Brand Architects institutes a free, eight-week crash course for Black creators, which equips smaller talent without a management team with negotiation tactics. “Black creators are always left out of conversations,” said Ernest James, senior vice president of the agency. “DBA understood that and said ‘How can we right those wrongs and help give these creatives the tools they need to build better businesses?’” View this post on Instagram A post shared by Digital Brand Architects (@therealdba) Lumanu, a free app for creators that works to democratize the space through transparent and efficient payments, believes that addressing the influencer pay gap requires individualized advocacy. The platform pairs each user with a “Lumanu companion,” who is either a fellow creator or a CPA. “The companion can answer business questions like ‘What does this term mean on my contract?’ and ‘Should I add a late fee?’” said Tony Tran, co-founder and CEO of Lumanu. “We really do believe in this idea of creators empowering other creators.” Challenging the definition of value At Digital Brand Architects, James helps influencers determine their value based on the deliverables of the campaign, like the type and number of posts requested. “We create rates based on jobs, so creators can negotiate their work versus the value of their talent,” said James, who stressed that this is a more equitable way to do business. Lumanu works with creator Jamilia Reddy, for example. She has just over 30,000 followers on Instagram, but most of her income comes from meditation coaching and creating content for meditation apps, which has allowed her to develop a solid fanbase outside of social media. Hardin also mentioned that influencers are often underpaid because their name and likeness aren't given value, especially when it isn’t necessarily reflected in their follower count. View this post on Instagram A post shared by Jamila Reddy (@jamilareddy) “While engagement and follower count matters, Jay-Z doesn’t have an Instagram following, but he’s one of the biggest stars in the world,” she said. “How are we valuing someone’s actual influence in the community? I work with people who are influential in the world. Not just on the internet." In studies across DTC fashion brands including Rent The Runway and Summer Salt, Lumanu created lookalike audiences for smaller, diverse creators and found more than a triple return on ad spend. According to Tran, conducting these studies and introducing the data to the ecosystem will have an impact on the influencer pay gap, as agencies and brands must be shown blankly that follower count does not define influence. “One of the fundamental ways of tackling this issue is transparency and data sharing,” he said. Creating Pipelines On top of the eight-week negotiation program, DBA will begin running an HBCU internship program later this year, which will introduce students to the talent management industry during their junior or senior year. In a predominantly white industry, it is important to have advocates with common experiences when working to close the influencer pay gap, explained James. “It’s very hard to find Black talent managers in our space,” said James. “Once we create those pipelines, we will quickly address the pay gap.” Through its influence change grant, influencer marketing agency Captiv8 equips people of color- or LGBTQ+-owned businesses with its marketing service, and head of strategic partnerships Saeyoung Cho believes uplifting diverse companies in the creator economy is a pivotal step in addressing the pay gap. “To attract the right creators, we have to have the right diverse brand opportunities,” she said. What Influencers Look for in Brand Deals