Do Influencers Pay Their Managers? | Payment of Managers for Influencers
Do influencers pay their management? In short, yes, they absolutely do. It would be strange for a manager to work for free. Let’s first talk about management in the industry. There are some clear distinctions between the influencer realms as far as management goes. An agent, an agency, a management company, and a manager, as far as social media influencers go, are pretty much the same thing. Now, in the acting arena in California, there are guilds, there are unions, and there are laws that dictate how much an agent can charge an actor. Those simply, at least at this point, don’t apply to social media influencers.
I’m talking about management: anyone who is assisting the influencer in facilitating sponsorship opportunities, personal appearances, or anything like that. Then there also is going to be some exclusive relationship between the two. Let’s say an influencer has hit the point where they want some professional representation. They find a social media influencer management company. That company will present the influencer with a contract, usually called an exclusive management contract, exclusive management, or something like that. And then that contract will dictate the terms of the relationship. And then obviously, one of the main parts of that is the payment.
Average Percentage Paid for a Manager
An average percentage of an influencer’s commission for a manager or management company is around 20% of whatever they bring to the influencer. So, if they facilitate a 30,000-dollar-a-year deal with a food prep company, the manager would get 20% of that 30,000 whenever it’s paid to the influencer. That’s an average amount. Now, it could vary. It certainly could be less or more. But if you’re talking with someone and they’re saying, oh, I take half or 40%, they’re just trying to take advantage of you. That’s crazy.
Details Concerning Commission Percentage
Now, two things to think about: these are going to be exclusive management contracts. They’re going to be the only company/person that can assist the influencer and facilitate deals. So, suppose an influencer has an exclusive management contract, and a friend, another influencer, or a brand reaches out to them directly. In that case, the contract will require them to send that to their manager. And then that manager will then negotiate/facilitate the deal and take a 20% commission.
So, you can’t get out of paying your manager the 20% for any deal that you utilize while under the exclusive management contract. I mean, managers do that because they don’t want an influencer to funnel deals through a third party to avoid having to pay their manager anything. There also will be language in the contract that states the influencer will still have to pay their manager after the contract terminates, which surprises many. If a manager brings someone a deal, then let’s say it’s a one-year deal. If the influencer terminates the agreement, the manager or management contract will state that the influencer will still have to pay 20% of whatever that manager brought them for a year after the contract ends.
Should an Influencer Give Up 20%?
Let’s say you’re in the fitness industry, you have an apparel deal you just signed, and then you decide to terminate the agreement with the manager. You’ll not get out of having to pay them 20%. You’ll have to pay them 20% for, as I said before, a year after the contract ends. Now, that can be negotiable: the amount of time you must pay the manager or even the percentage. You might want to try to reduce it over time.
But you’ll rarely have an exclusive management contract that doesn’t have some language that states the influencer will still have to pay the manager for specific deals. They just don’t want to bring a great deal to an influencer. The influencer terminates the contract, takes the deal, and then avoids having to pay the manager any commission percentages. That’s fair. So, that’s a little bit about how much managers get paid by influencers.
Other Blogs of Interest
- Do Influencer Managers Have Contracts?: Need for Safe and Fair Influencer Management Agreements
- Is There a Non-Compete in an Influencer Management Contract? | Influencer Non Compete Agreements
- How Do I Get a Manager as a Social Media Influencer?: Concerns with Influencer Social Media Managers
What is the Purpose of an Influencer Management Contract? | Influencer Agreement
What is the purpose of an influencer management contract? The purpose of any contract is so both parties can understand their duties and responsibilities when interacting with each other. A social media influencer management contract is a contract between an agency, a manager, a marketing company, or someone that’s going to oversee the career of the influencer, bring them sponsorship opportunities, negotiate the price associated with that opportunity and then facilitate the contracts between the influencer and those sponsors. Now, the management contract will be between the influencer and the manager. All the terms of the relationship in the influencer management contract must lay out. The most important terms in any contract, the same as an influencer management contract, are the term, meaning how long the contract lasts.
Influencer Agreements with a New Manager
For the most part, influencer management contracts start at least somewhere between three to five years. That doesn’t mean if the influencer is unhappy with the manager, they cannot leave for the following reason. There will also be a section called termination. And then, that section will go over how either party can terminate the contract. Almost every contract will have what’s called without-cause termination. This means either party can terminate the contract at any time, for any reason, with a certain amount of notice to the other party.
If you are signing an influencer contract with an agency or a manager, you want to have without-cause termination in there. It would be improbable it wouldn’t be in there, but if it was absent from the contract, you could be in a horrible relationship with the manager and cannot terminate it if they’re not in breach of contract. And essentially, you’re stuck with many you don’t want to be with for years. So, you have to make sure that without-cause termination is in the influencer contract.
There will also be a section about compensation. So how much will the manager or agency get paid by the influencer? For the most part, it’s based upon a percentage of the commission. Whatever the sponsorship deal is with the influencer, the agent/manager will get a portion of that. 20% is the industry standard. Certainly, it could be less or more, but around 20% of whatever you make as an influencer will likely go to your agency or manager. Now, indeed, influencers can negotiate that. But that’s a standard amount.
What Usually Happens When an Agreement Ends
What also needs to be in there is what happens after the contract ends. Every manager agency will put a clause into an influencer agreement that states that even if the relationship terminates, they will still receive a percentage of any of the deals they brought to the influencers for a set period. Usually, that’s one year.
Let’s say your management company got you a deal with the skincare line, then the influencer terminates the contract with the manager. Still, the skincare company wants to continue the relationship with the influencer. The influencer will still have to pay 20% to their old manager for a year. Managers do this because what they don’t want to do is bring a deal to an influencer. The influencer terminates the agreement, takes the deal, and does not have to pay any commission to their past manager.
This is an equitable term in the contract. Now, indeed, influencers can negotiate parts of this. Maybe shortening the time, they have to pay any commission to their old agent, or perhaps narrowing the commission percentage over time, which means, that maybe every quarter, if it starts at 20, then 15 in the second quarter then 10 in the third and five in the last.
And then the responsibilities of the parties are going to be laid out as well. What will influencers have to do? How fast will they have to respond? And in which way will they have to communicate? Will they have to post content about their management company, or is it just the sponsors? Who pays for travel? If there’s just a one-off, what will the percentage of that be for the agent?
Why Influencer Contracts are Crucial
I mean, there are a ton of things that influencers must consider in advance. The worst thing that can happen for a digital creator or influencer is to get into a bad contract with a manager, get taken advantage of, and maybe even have their career stifled in some way by not being able to pursue the best opportunities.
The last thing to think about is many influencers are surprised that most of these management contracts are exclusive. Meaning, even if a friend, another influencer, or another agent brings a deal to an influencer, they have to take that deal back to their manager if they’re in an exclusive management contract.
The manager will then negotiate it and still get 20%. Even if someone brings you deals independent of your manager, it’s very likely the manager will still get 20% of whatever deal. Is that fair or not? Well, that’s just part of having a manager. So, that’s the purpose of a management contract. It just lays out all of the responsibilities for both parties.
What is an Influencer Management Contract? | Influencer Management Agreements Explained
What is a social media influencer management contract? As an influencer begins to grow, at some point, they will likely want to bring in a manager, agent, or marketing agency, all kinds of the same thing. Essentially, somebody will go out and try to find your sponsorships so that you can get paid for your cloud. You will absolutely want/need to sign a social media influencer management contract outlining the responsibilities between the parties. For example, you want to know how long the contract lasts, the terms of the agreement, and how parties can terminate the agreement. So, do you have to give notice? Is it a fixed term?
Social Media Influencer Agreement Terms
Does it renew automatically at the end of the initial term? How to terminate the influencer contract is certainly important. Obviously, what the manager/agent is going to do for you? Are they going to go out and reach for every type of marketing opportunity for you? Is it an exclusive management contract, meaning you must use them and can’t use anyone else? Who are you going to communicate with? How much are you going to pay them?
For the most part, influencer management contracts will have a commission percentage, meaning your manager will bring deals back to you, and then you’ll determine if you want to move forward or not. And then you’ll pay a percentage of that whole deal back to the manager. 20% is an industry standard. It can be more or less, but 20% is an industry norm as far as how much percentage of commission is paid back to your manager.
Influencer Expectations When Working With a Manager
What the expectations are of the influencer as well. Things such as, how often do you have to check in with your manager? Is there a software program that needs to be used to track the contacts with anyone else? If you go out and find a deal outside your manager, do you still have to bring it back to that manager so they can negotiate the deal? Do they get a percentage of deals you consummate that have nothing to do with the manager? For the most part, if you have an exclusive management contract, even if a deal falls out of the air, into your lap, and the manager has nothing to do with it, they’re going to require a percentage of that deal if they’re managing you. It may not feel great, but that’s just part of having an agent or a manager.
It Doesn’t End Once the Agreement Ends
Also, what are the obligations once contracts end? As I stated before, you’ll pay the agent/manager a percentage of whatever the commission is for the deals they bring you. Almost every agreement will have language stating after the influencer contract ends for a period, any deal that they’ve got you that continues after the agreement ends, a percentage will still go back to them.
Let’s say you’re in fitness, and you’ve had a deal with a protein shake maker. If the manager brought you that deal, and you terminate the agreement, you’ll still have to pay them, let’s say, 20% for a year after the contract ends. Managers do that because they don’t want to bring an influencer deal. Then, the influencer immediately terminates the relationship, takes the deal, and gets out of having to pay the commission percentage back to the manager.
How Long are Most Influencer Management Contracts? | Influencers Agreement
How long are most influencer management contracts? Suppose you’re an influencer, and you’re starting to get bigger. In that case, you’ll likely want to reach out to a manager, agent, or marketing agency. It’s all grouped into the same thing. And then you’ll establish a relationship where they will go out and find deals to bring back to you and negotiate the compensation. And then, essentially, assist you in growing your business as an influencer. Before establishing that relationship, an influencer management contract needs to be signed that details the responsibilities between the manager and then the talent, the influencer. If that is not in place, I can promise you that there will be a discrepancy down the road, and without a contract in place, those types of issues can magnify greatly.
Need For Influencer Manager Agreements
Now, one question I get frequently is, how long is a management contract? Many influencers are concerned, like, I think this person is good. I’m interested in them becoming my manager. However, I don’t necessarily know them and haven’t worked professionally with them. And so, what do I do if I don’t like them but sign through your contract? In any agreement, there will be some language that states how long it lasts.
Most influencer contracts, or at least influencer management contracts, are between one and five years. And that simply means the contract will go on for that time. And then there’ll be language that states that it will automatically renew if neither party terminates the agreement or if it’s a fixed term. It could simply end if there’s no renegotiation after the end of that period. In every management contract, there usually is, but there needs to be a section that’s called without-cause termination. So, there’ll be a term section that says how long it lasts and then a termination section that lists how to terminate your contract.
Ways to Terminate a Contract
There are four common ways to terminate a contract. As I stated before, if it’s just a fixed term and it’s not renewed, it ends. Two, by mutual agreement. Suppose either party feels that, regardless of the rest of the contract terms. In that case, they want to move on and wash their hands of the situation. You can mutually agree to terminate the agreement. Three, breach of contract. Suppose one party is not following through with the responsibilities of the agreement. In that case, the other party can provide them with written notice that they’re in breach of the contract.
And if that party doesn’t fix the problem, or doesn’t cure the breach, then the party that’s not in breach can terminate the agreement immediately. And then the most common way is without-cause termination. And it simply means that either party can terminate the contract, at any point, for any reason, with a certain amount of notice to the other party. Usually, it’s somewhere between 30 to 120 days in most influencer management contracts.
Let’s say you have a 60-day notice requirement. Then you would provide written notice to your manager that just states, per the agreement, I’m giving you 60 days’ notice that I am terminating the contract. Then you would work out those 60 days, and at the end of the 60 days, you would be free to find a new manager or agent and move forward. Although the term of your contract, I mean the length of the agreement, could be three years, you still can get out of it at any point within 60 days or whatever the notice amount is in your contract.
What Should You Do if There’s No Without Cause Termination in Your Contract?
So, you’re not stuck for three years. You do have the option to terminate the agreement. Now, it needs to be in there. If you don’t have language that states you can terminate the contract without-cause, you need to speak to someone who understands that and can put it into the agreement. You have to have options if it’s not working out. If you’re with an agent or manager who is simply underperforming and not bringing you the deals you should be getting, you can’t stick around. You must cut ties and move on to someone better. And without-cause, the termination will allow you to do that.
A Couple of Considerations
A couple of considerations after the contract ends: even though you can terminate the agreement without-cause, there very likely is going to be language in the contract that states any of the deals, so any of the sponsors that the manager brought to the influencer during the term of the agreement, that manager is going to get paid their commission percentage for usually a year after the contract terminates.
Let’s say you reached a deal with the skincare company, and the manager brought it to you. Even if you terminate the agreement, you’ll still have to pay that commission percentage back to that manager for a year after the contract ends. Even if the brand wants to continue the relationship and you have a new manager. And then, that new manager will not see a dollar of what that old deal made by your old manager was. For this reason, there will be some provision in the contract that states you’ll have to pay them the percentage for a year after the contract ends. Why is that? Well, most managers don’t want to bring someone a great deal. Then that person terminates the agreement and avoids having to pay the commission percentage back to the manager for getting them that deal. I mean, that makes common sense.
What Can You Do Regarding the Commission Percentage?
Now, a couple of things that an influencer can do, you can either shorten that period you’d have to pay back the percentage. You can lower the percentage over time, so maybe if it was 20%, then it’s like 20% for the first quarter, 15 for the second, 10, 5, step it down. But it would help if you protect your interest as well. Suppose you have terminated the agreement with a manager. In that case, it is for a reason. I can tell you, on an emotional level, that it feels terrible to continue to pay your old manager when they’re not even assisting you anymore. So, that’s how long a standard influencer management contract is and how you can get out of it.
Social Media Influencer Manager | Influencers Management
Social media has become an essential part of our lives. With a good percentage of the world population on social media. It has become a primary marketing channel. Establishing a social media marketing strategy to grow your reach and increase conversions is critical. Many successful brands include collaborating with social media influencers in their strategy. Influencers are trusted experts in their niches and can influence their followers’ buying patterns.
Influencer marketing is a lucrative industry projected to grow to $16.4 billion in 2022. As the industry grows, so does the number of influencers and service providers supporting it. Influencer marketing-related services grew by 26% in 2021. Social media influencer managers are among the essential service providers in the industry.
Social Media Influencers Need for Manager
Social media influencers need managers to handle the business aspect of their careers as they focus on building their brands. Influencers with managers achieve more growth and success in their jobs than those without managers. Influencers can take advantage of their manager’s network and industry experience to get ahead of the pack.
Social media influencer managers guide clients through sourcing, negotiations, and signing contracts. They know how much per brand can pay, so they ensure brands do not exploit or shortchange their influencer’s clients. Managers understand contract details and will see what you are getting into – what brands expect and how they will compensate the influencer.
Having a manager is essential to expanding your career. Influencer managers have connections with different industry leaders. Your manager will put you in touch with other brands, presenting opportunities that influencers without managers don’t get.
Ways to Get a Social Media Influencer Manager
You can contact an influencer management agency or the influencer manager you want to work with directly. Agencies and influencer managers also reach out to social media influencers. They think it would be a quality addition to their client list.
It is not just enough to have a manager for your influencer career. Influencers need to hire a manager who will improve and streamline their career. When looking for a manager, influencers must package their craft professionally. That is because managers sift through so many applications to decide who is worth representing. To stand out, you must create unique and valuable content.
Every agency or manager focuses on a particular industry. An influencer has to find an agency that aligns with his industry or the direction you want to take with his career. The influencer can consult other influencers in your industry to recommend managers so that you can spend less time landing your best fit.
You must consider several factors before signing with a management agency or manager:
- How many influencers in your niche do they represent?
- Have the influencers in their roster seen more career growth and success since signing with them?
- What is the agency’s strategy to help you maximize your social media reach?
- What are their short- and long-term goals to help build your brand?
- How much will they take from your influencer revenue?
Influencer Management Contract Questions?
Contract Review, Termination Issues, and more!
