Costs and pricing
Part of Before you price a brand deal, check what sponsorship rates really cost
How to compare sponsorship rates pricing models with a weighted score
Compare four sponsorship rates pricing models, score them with weighted criteria and test a worked example before you quote a fee for a brand deal.
What to take away
- Most teams pick a pricing model before they know their own cost base. Build the cost base first, then choose the model that covers it.
- Flat fee, cost-plus, performance and hybrid put risk in different places. The model decides who carries the shortfall when a campaign underdelivers.
- Every rate needs a floor as well as a targetthe number below which a deal loses money once usage rights, reshoots and payment terms are counted.
- Staffing assumptions behind a quote can be checked against the historic employer figures in Rates and thresholds for employers 2023 to 2024.
The four pricing models compared
Each model answers a different question about who carries the risk, and the choice should follow your cost base rather than the buyer's preference.
Four sponsorship pricing models
Flat fee
- Basis
- One number
- Risk bearer
- Creator
- Scope control
- Poor if scope creeps
- Best for
- Repeat campaigns
Cost-plus
- Basis
- Costs + overhead + margin
- Risk bearer
- Shared
- Scope control
- Every line has basis
- Best for
- Defensible quotes
Performance
- Basis
- Clicks, sales, sign-ups
- Risk bearer
- Buyer
- Scope control
- Tied to tracked results
- Best for
- Trackable outcomes
Hybrid
- Basis
- Reduced fee + bonus
- Risk bearer
- Shared
- Scope control
- Bonus tied to results
- Best for
- Balanced risk
Flat fee
One number covers a defined deliverable, usually a set number of posts within a stated window. Quoting and invoicing stay simple, and the risk of overrun sits with the creator.
Flat fees suit repeat campaigns where both sides know the effort involved, and suit poorly where scope creeps. An illustrative flat £1,200 for three posts absorbs the cost of a fourth revision.
Cost-plus
You total direct costs, add an overhead percentage and a margin, then quote the sum. Every line has a basis, which makes the number easier to defend.
It also exposes your cost base to the buyer, which some creators dislike. Platform obligations shape how audience data is collected and shared. The Digital Economy Act 2017 provisions on online advertising and data sharing are worth reading before you promise data you cannot lawfully supply.
Buyers sometimes treat a cost-plus figure as a ceiling. It is a floor. The overhead percentage you agree today covers today's tools and today's team, so it needs revisiting when either changes.
Performance and hybrid
Performance models pay on clicks, sales or tracked sign-ups. Hybrid models pair a reduced flat fee with a bonus. Both shift risk towards the creator, so the flat element should cover costs even if the bonus never pays.
An illustrative £600 base plus a bonus is workable. A £150 base plus a bonus is a gamble on the buyer's tracking. Check the bonus trigger and tracking method in the agreement, and build the base from your own direct costs and overheads.
Scoring the models
Score each model from one to five on the criteria below, multiply by the weight, then compare. The highest total wins that deal, not every deal.
Worked example figures
- £2,500illustrative flat fee
- £700direct costs
- £300overheads
- £1,333cost-plus before margin
Score each model before negotiating
- Cost recovery30% weight
- Scope control20% weight
- Cash flow20% weight
- Defensibility15% weight
- Admin burden15% weight
Weight
- Cost recovery
- 30%
- Scope control
- 20%
- Cash flow
- 20%
- Defensibility
- 15%
- Admin burden
- 15%
A 5
- Cost recovery
- Covers all direct and overhead costs before margin
- Scope control
- Extra work triggers a new quote automatically
- Cash flow
- Deposit or staged payments agreed
- Defensibility
- Every line traceable to a cost or benchmark
- Admin burden
- One invoice, one reconciliation
A 1
- Cost recovery
- Loses money if the campaign underperforms
- Scope control
- Unlimited revisions built in
- Cash flow
- Single payment 90 days after publication
- Defensibility
- A round number with no basis
- Admin burden
- Monthly reporting for a small fee
Score a model before you negotiate, not after. A model that scores poorly on cost recovery rarely improves once a buyer has anchored the conversation on a lower number.
Weighting the criteria
Cost recovery carries the most weight because it decides whether the deal is viable at all. Scope control and cash flow come next. Change the weights once a year, not once per deal, or the rate card becomes impossible to explain.
Worked example
An illustrative flat fee of £2,500 covers a three-month campaign, against direct costs of £700 and overheads of £300. Cost-plus on the same inputs lands near £1,333 before margin.
Now test an illustrative hybrid: an £800 base plus a £1,700 bonus at target. If the bonus does not pay, £800 is recovered against £1,000 of costs, a loss of £200.
Applying the rubric
These are illustrative judgement scores, not market benchmarks. They use the £2,500 flat fee, near £1,333 cost-plus fee before margin and £800 hybrid base against £1,000 of costs above; the performance model assumes no guaranteed fee. A score of 5 is most favourable, including lower admin burden, and 1 is least favourable.
| Model | Cost recovery (30%) | Scope control (20%) | Cash flow (20%) | Defensibility (15%) | Admin burden (15%) | Weighted total (/5) |
|---|---|---|---|---|---|---|
| Flat fee | 5 | 3 | 4 | 3 | 5 | 4.10 |
| Cost-plus | 5 | 4 | 3 | 5 | 2 | 3.95 |
| Performance | 1 | 3 | 1 | 2 | 2 | 1.70 |
| Hybrid | 2 | 3 | 4 | 3 | 3 | 2.90 |
Each total is the sum of the criterion scores multiplied by their weights. On these assumptions, the flat fee ranks highest, narrowly ahead of cost-plus; change the scores if the campaign scope, guaranteed payment or admin demands differ.
Where audience fit changes the price
Audience fit can support the value and delivery case, but it does not establish a market rate on its own. Record which audience and placement the fee assumes, then use the same rubric to test how defensible that assumption is.
Matching spend to routines
A rate is only defensible if the audience actually sees the work. Research from IAB UK on fitting mobile content into women's daily routines helps when you justify a placement slot, because timing affects measured delivery.
Documenting your assumptions
Keep a file of benchmarks, dates and sources behind every rate. For each figure, note whether it is a past campaign result, an internal cost or an external benchmark; do not present an internal cost as a UK market rate.
Date every figure and note the campaign it came from. Benchmarks age quickly, and an undated number is easy for a buyer to challenge and hard for you to defend.
Common questions
Which pricing model suits a first brand deal?
Cost-plus, because it forces you to list costs before naming a fee. Once quoted a few times, flat fees become easier to set at a level covering the same base.
Should performance deals ever be accepted?
Only if the guaranteed element covers your costs. Treat any bonus as upside, never as the part that makes the deal viable.
How often should the rubric be reviewed?
Once a year, or when your cost base changes materially, for example after hiring or buying equipment. Weights should not move between individual quotes.
Do usage rights change the model choice?
They change the price, not usually the model. Longer usage windows and paid media rights belong as separate line items on top.
