Q&A: An Influencer Marketing Expert Answers Your Legal Questions
This week I was excited to interview lawyer and industry expert, Danielle Liss, about some of the common legal questions surrounding influencer marketing.
Danielle is a partner and founder of Businessese. She is also a partner in Hashtag Legal, a law firm focusing on social media law with an emphasis on legal issues related to bloggers and influencer marketing. She has extensive experience negotiating contracts and interpreting FTC guidelines. You can read more about Danielle on her website.
It’s important for everyone engaging in influencer marketing to know the answers to these questions, but for quick reference we have split the questions into two categories: influencers and brands.
Influencer Marketing: Your Legal Questions Answered
Should an influencer get their contract with a brand or agency checked by a lawyer for every campaign?
It depends on the influencer’s comfort level in reading contracts. You don’t need a law degree to read a contract, but if you don’t understand what you’re reading, you should contact an attorney. Or if you feel like something is missing from the contract and you don’t know how to phrase it, that’s something we can help with.
Does an influencer legally own the rights to the sponsored content they produce?
It depends on the term of the contract. If the contract says nothing about ownership or intellectual property rights, then the influencer has the copyright on that content and all rights associated with the copyright.
However, the contract may have terms related to the intellectual property rights. Per the contract, the content may be a work for hire and the brand or agency owns it. Or the contract may provide that the influencer still owns the content; however, they are licensing some of the rights to the brand or the client.
What I typically see is that the influencer will own the content and then the brand gets an unlimited license to use the content. But, it’s really important that it be specific in the contract so that you know who owns what and how they can use it.
If a brand doesn’t specify the FTC regulations in their contract does an influencer still need to disclose compensation or that they are working with a brand/agency?
Yes, absolutely. The FTC provisions are there to guide any type of sponsored content and it is up to both the influencer and the brand to know exactly what is required in terms of disclosures. You definitely need to disclose, even if the contract doesn’t mention it.
If you get a contract that says you can’t disclose then you may want to take a step back. I would have some questions for them as to why they’re trying to get around the FTC requirements.
What happens if you don’t know about an update to FTC regulations? If an influencer breaks FTC rules can they legally be held responsible?
Yes, influencers can be legally held responsible. Usually when the FTC puts out an update they will give a period of time for everybody to implement the changes prior to enforcement.
Typically the FTC hasn’t been coming down on individual bloggers, but that doesn’t mean they won’t do that in the future.
Think of it like links in a chain: The brand is going to be responsible, if you’re working with an agency then the agency will be held responsible, and then you, as the person who is putting out that marketing message, could also be held responsible. Anybody who is part of that process can be liable. The key is making sure you disclose and then you should run into any issues.
Remember, if you’re getting something from the brand whether it’s product or compensation, it needs to be disclosed.
What are 3 legal concerns that a brand should be aware of before they get started with influencer marketing?
- 1. FTC: Make sure you review FTC rules before you start influencer marketing. I see some brands that haven’t reviewed the FTC requirements and then they don’t understand why influencers are disclosing. Know what the disclosure on the content is going to look like and set your expectations accordingly.
- 2. . Intellectual Property: Prior to entering contract, have an idea of what you want to do with the content. If you want it to be published and only marketed to the influencer’s audience, you may not need to get a license to reuse the content. But, if you want to reuse the content for your own marketing, make sure that you include it in the contract. Also remember, this may potentially increase the pricing.
- 3. Exclusivity: If you want exclusivity from the influencer, and that means that they’re not going to promote any of your competitors products within a certain period of time, then you need to make sure that’s covered in your contract and that you have adequate budget to compensate the influencers for the exclusivity. Never assume that you have exclusivity for a specific period of time unless it’s specifically agreed to.
If a brand wants to use influencer content from a campaign what do they have to do to tick the legal boxes?
Make sure you do it before the contract is signed. It’s easier to handle it at the beginning because it can impact the pricing. If you wait, you may need a separate licensing agreement with a royalty payment. It’s easier to cover this at the start.
In your experience is it better for brands to work with influencers directly or go through an agency instead?
Full disclosure, I used work for a network, and we acted as an agency so I am biased in favor of networks. However, I think it depends on the goal of the campaign and what your company can handle internally.
I think many companies don’t realize is how much time influencer marketing can take. There’s a lot of coordination with the influencers, plus contracts, reporting, and any necessary follow-up. If you don’t have someone in-house who is dedicated to this type of work, it can be really overwhemling. My recommendation is if you’re working with more than one influencer at a time definitely consider using a network. A network will handle everything from start to finish, and make sure that the contract has what you need, and that the FTC regulations are covered.
If influencer marketing is new for your company, working with an agency is the best way to dip your toes into the water and get a better feel for how to execute a campaign.
Is influencer marketing worthwhile for a brand despite the FTC regulations?
Absolutely. Any type of advertising that you do is still going to be governed by the FTC.
I think the key to the power of influencer marketing is to remember that, compared to a lot of other forms of marketing, it’s got a much bigger impact and it’s much more cost-effective.
Don’t let the FTC be a hurdle. View it as part of doing business, like any other form of advertising.