influencer marketing

Do Influencer Partnerships Need Contracts?

Influencer marketing is a form of social media collaboration that is very popular today. This approach to marketing focuses on posts from popular social media personalities that maintain a strong following. Today, some influencers have excellent careers through the strategic partnerships they choose. There are many ways these partnerships form, whether through a paid agreement or a gifting situation. Sometimes, in gifting situations, the brands will blindly send their products to influencers, in the hopes that the influencer enjoys it and posts about it organically. Sometimes, they make formal agreements in which a brand pays an influencer a sum of money to post about their product. However, whether a gifted or paid partnership, the question remains: do influencer partnerships need contracts?

 

History of Influencer Partnerships

Influencer and brand partnerships have been around since 2006, when PayPerPost, the first influencer marketing platform, was born. Since then, the practice has boomed, and almost all modern social media platforms have some type of influencer present. Before 2019, however, there was little regulation of influencer marketing. Brands and influencers alike didn’t have much keeping them from keeping their business affairs private. Influencers often post about a brand without disclosing that they were paid to do so, causing critics to say that these posts are inauthentic, and in a sense, deceptive to consumers. 

In 2019, the Federal Trade Commission stepped in and released official disclosure guidances to influencers regarding their brand partnerships. These guidelines made it clear that the responsibility to make disclosures about endorsements lies with the influencer. However, whether or not all influencer partnerships require contracts is still ambiguous by the FTC. At this time, most agencies and PR professionals concede that if there is a formal agreement between the brand and influencer in exchange for a product or payment in which the influencer agrees to post, then a contract needs to be made and signed. This protects both the influencer and the brand, and hold each party responsible to uphold their agreement. However, the lengths to the formality of those contracts differ with the type of partnership: gifted or paid. 

 

Influencer Gifting

Many influencers receive their payment in the form of product gifting. Gifting usually includes free items from the brand in hopes that the influencer will post about it. Products as a form of payment can be ideal to many brands as oftentimes there is a limited budget for their upcoming launch. However, most don’t consider ‘gifting’ as actual payment, therefore an influencer cannot be held accountable to actually post. Influencer marketing in the form of gifting should only require a formal contract if the company fully expects the influencer to post about their products and the influencer agrees. If the gift is truly a gift, however, the influencer does not have to post about it if they choose not to. 

 

Paid Posts

Another type of influencer partnership includes financial compensation. This means influencers are paid actual money to post content promoting a brand or product. These “sponsored” posts from influencers can range from a few hundred dollars to tens of thousands of dollars, and even go up to the millions (looking at you, Kylie Jenner). Formal contracts should be necessary with these transactions in order to solidify the brand deal. Plus, it holds the influencer accountable for posting about the product, and the brand accountable for giving payment. These contracts are designed to protect both parties, and are absolutely necessary for paid posts.

 

 

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