Influencer marketing works for a small business when the audience genuinely overlaps with your customers and the recommendation is credible. It fails when it is bought on follower count, because a large audience that will never buy what you sell produces traffic and no revenue, at a price set as though it would.
The economics are more checkable than most people assume.
Audience fit beats reach
A creator with a small, closely matched following will usually outperform a larger general one, because the people seeing it can actually buy. Smaller creators also charge less and engage more with their audience.
Ask for audience data rather than follower numbers: location, age, and how many people actually see and respond to posts. Follower counts can be bought; engagement from a real local audience cannot.
Pay for an outcome you can measure
Agree what you are buying: a defined number of posts, usage rights to the content, and a tracking mechanism such as a discount code or a dedicated link so you can tell what it produced.
Without tracking you are buying a feeling. With it you can compare cost per customer against what a customer is worth, which is the only way to decide whether to do it again.
Put it in writing
Deliverables, dates, approval process, exclusivity if any, how long you may use the content, and what happens if posts are removed or the creator becomes controversial.
Content you paid to produce should be usable in your own advertising, which is often worth more than the post itself. That right has to be agreed rather than assumed.
Disclosure is a legal obligation on both sides
Paid partnerships, gifted products and affiliate arrangements must be disclosed, under the code administered by the Advertising Regulatory Board. The obligation falls on the advertiser as much as on the creator.
Claims made on your behalf must also be substantiable, and for regulated sectors such as financial services or health, the sector rules apply to what the creator says just as they would to your own advertising.
Frequently asked questions
Does follower count matter?
Less than audience fit. A small, closely matched audience usually outperforms a large general one and costs less.
What should I ask a creator for?
Audience data, including location, age and genuine engagement, rather than follower numbers, which can be bought.
How do I measure whether it worked?
A discount code or dedicated link, then compare cost per customer against what a customer is worth to you.
What should the agreement cover?
Deliverables, dates, approval, exclusivity, how long you may use the content, and what happens if posts are removed.
Who is responsible for disclosure?
Both. The obligation falls on the advertiser as well as the creator, and sector rules apply to what is said on your behalf.
Further reading
Originally published in January 2018. Updated September 2026 into practical guidance on using influencer marketing in a small business.
