How to Calculate Your Sponsorship Price (Based on the Brand's Goals and Scope of Work)

Let's pretend we're trying to price a single 90-second integration in a video post on a views-based platform.

The first thing you must do is calculate your Average Video Views (AVV).

To calculate your AVV, total the views for your last ten posts and divide by 10. If you have any significant outliers (e.g., a video with 150,000 views when your "typical" is 10,000), exclude that entirely from the calculation so you don't throw off the average.

The whole point of an average calculation is to reasonably anticipate how a future post would perform if the brand were to hire you.

For this example, let's say you calculate your AVV as 60,000.

Next we must assign a Cost-per-view, or CPV, relative to the Campaign Goal.

For benchmarking purposes, assume the following for views-based platforms:

If the brand has indicated that the goal of this campaign is Conversions, the amount you would charge for just the content creation would be:

Content-only formula: AVV * CPV

Or 60,000 (AVV) * $0.03 (CPV) = $1,800.

Note: If the brand asks for a dedicated video (where the entire focus is on the brand), I recommend doubling the rate (total fee: $3,600).

OK, back to the integrated example.

Now, let's imagine the brand's primary objective is Awareness.

Instead of a $0.03 CPV, our formula becomes:

60,000 (AVV) * $0.10 (CPV) = $6,000.

That's more than 3x for an Awareness campaign vs. a Conversion campaign!

This is the primary reason you cannot price yourself in a vacuum using your audience size or reach, as the brand's objectives will massively affect the number you quote.

But wait, what if the brand wants exclusivity?

Exclusivity formula = Add an incremental 10% of the base investment for each 30 days.

If the brand asks for three months of exclusivity (from the integrated example), you would then charge:

($1,800 * 10%) * 3 months = $180 * 3 = $540

Total investment: $1,800 (content) + $540 (exclusivity) = $2,340

What if the brand only asks for usage rights to run advertising with your generated assets (but no exclusivity)?

You must first determine where they want to distribute it.

If the brand is asking you to send them the raw assets so they can upload them natively on their platforms (licensing), the formula becomes:

Licensing (On their platforms) = Add an incremental 15% of the base investment for every 30 days.

($1,800 * 15%) * 3 months = $270 * 3 = $810

Total investment: $1,800 (content) + $810 (licensing) = $2,610

If the brand also wants the ability to boost your native content (amplification), the formula becomes:

Amplification (On your platforms) = Add an incremental 25% of the base investment for each 30 days.

($1,800 * 25%) * 3 months = $450 * 3 = $1,350

Total investment: $1,800 (content) + $1,350 (licensing + amplification) = $3,150

What if they want the whole shebang? Exclusivity, licensing, and amplification rights for three months?

Add the Exclusivity and Paid Usage factors together (10% exclusivity + 25% paid usage = 35%).

($1,800 * 35%) * 3 months = $630 * 3 = $1,890

Total investment: $1,800 (content) + $1,890 (exclusivity + licensing + amplification) = $3,690

One very important "A-ha" I hope you have at this point is that, with many sponsorships, the additional exclusivity and usage rights may exceed the investment for the content creation itself.

In the example above, the additional rights are $1,890 while the content is $1,800.

If you feel uncomfortable employing this pricing strategy during an actual negotiation, rest assured that this structure is standard for most medium and large brands.

They're accustomed to paying a finite fee to a production company to generate creative assets they can use for much longer to run advertising campaigns.

Although I used a "video" for the sponsorship we calculated in the example above, similar formulas can be applied to every other content format.

Assume the following benchmarks for impressions-based platforms (social media, etc):

Your Content-only formula then becomes: AI (Average Impressions) * CPM

E.g. (60,000 ÷ 1,000) * $30 = $1,800

And assume the following benchmarks for opens-based platforms (newsletters, etc):

Your Content-only formula then becomes: AO (Average Opens) * CPO

E.g. 60,000 * $0.03 = $1,800

As a reminder, I strongly recommend against granting perpetual usage rights unless you're paid a lot of money (at least 10x your typical investment) since the brand could theoretically exploit your name and likeness forever.

Note: For event sponsorships (in-person or virtual), benchmarks vary wildly across industries, so your best bet is to ascertain the brand's feasible budget range.

Pricing is an art and a science, so the formulas above should be treated as your baseline. If you calculate your numbers and they seem too low or too high, given the nature of your relationship with the sponsor or other deal dynamics, you should modify them until you're more comfortable.

However, many of my students have shared that sending uncomfortable numbers, only for the brand to say, "YES!" is what finally unlocked their negotiation fearlessness.

Note: If you'd prefer to use my Sponsorship Pricing Calculator that incorporates these formulas, you can access it through my Brand Deal Wizard course.