Influencer marketing has exploded to an estimated over 20 billion in 2023 and is one of the most reliable ways to reach your target audience, with 83% of marketing agencies, brands, and PR firms deeming it effective and 63% of them looking to expand their influencer marketing budget this year confirming it to be a field that still holds a lot of potentials.
But with those potentials come also an amount of uncertainty and confusion. Most countries and legislative bodies have yet to catch up on influencer marketing and this can lead to some sticky situation when dealing with a campaign that goes sour.
With forward thinking and some preparation most of the issues can be prevented and avoided but can be difficult to figure out exactly how. This is why we put together this article going through all that you need to know and look out for.
Why sign a contract when working with influencers
A contract is an agreement between two or more parties that holds legal value and is enforceable in a court of law. While you may think that having some kind of trace in your email or DMs is enough to provide a legal backbone to the partnership this can often not be enough, or can be found out to be enough only after long and costly legal battles.
The best way to avoid all of these possible problems and costs is to have a signed contract that puts in black and white what is expected, and how things are going to be carried out.
You can find some examples of contracts with influencers online but they often lack some important parts or the level of specificity your case may require.
Common issues between influencers and brand
Very straightforward, the influencer does not post the content that was paid for or posts only a part of it. Alternatively, the content is not in line with the guidelines of your brand or is not what you agreed upon.
Studio71 flew Bethany Mota to Hawaii to film content related to a skincare product campaign to be integrated into one of her YouTube videos. They were horrified two days before the launch of the campaign when they finally received the video to find out that none of the Hawaii footage was used and instead was just given a shoutout to the skincare company. They filed suit against the influencer for breach of contract.
Content life on social media is not very long, but that doesn’t mean you want your sponsored, content to disappear especially now that social search is a growing phenomenon. That’s exactly another important issue your agreement should take into consideration.
In 2019 a Melbourne cafe and the influencer Chloe Roberts had a breakthrough due to the influencer achieving the sponsored posts, making them unavailable to the public, she had made for the cafe. The court recognized the potential damage that archiving content prematurely could have caused but also noted how difficult would be to establish when premature is exactly.
Repurposing influencer content is pivotal to many marketing campaigns but any content which have been made free and creative choices is automatically owned by the content creator. You can freely use the tools of the platform it was originally posted on but nothing other than that.
Many countries require influencers to disclose which content is sponsored content. Some countries may even hold the sponsor accountable for non disclosing the sponsored content along with the influencer. Be sure to make clear that your paid content needs to be labeled as such.
What to include in the contract
You can find contract examples by a simple Google search but in most cases, they only cover the most prominent situations, which is fine as long as all goes well. But we want to help you craft a contract that is going to be bulletproof. This is why we put together this list of thighs you should consider introducing in the contract, not all may be necessary in every case, but you can pick and choose the ones that will cover your needs.
Timeline of the partnership
Be sure that your contract features a timeline of the partnership, this can be a tight timeline with exact dates, even hours if necessary, in which you want the content to be posted or just a general timeline of by when you want the content to be ready. Will provide the agreement with a time dimension and create a period after which you can consider the influencer in breach of the agreement.
In the case of specifying the service provided you want to be as specific as possible, so you may want to include:
Type of content
If they should be photos, videos, Instagram Stories, Ad reads, or integrations in other content. Being clear on what type of content you are expecting from the collaboration is going to avoid possible misunderstandings.
Specify which platform you are expecting the content to be shared on. In cases of platforms that allow more types of content, be specific about it. For example, just saying a photo on Instagram can open the possibility of it being interpreted as a photo in a story or a photo in a dedicated post. Specify exactly what you are expecting.
Some content creators may delete or archive a part of their older content to keep a streamlined profile, to prevent your sponsored content from being prematurely hidden establish how long it has to be available to the public. This is especially important when the content is internally dedicated to the sponsorship but less relevant if you are planning integration in a larger content format.
Is important to be clear on how you want your brand to be mentioned and presented, this may include which links need to be included or accounts tagged, the tone, supporting imaging, color scheme, background music, or any other details of the sponsored content that you deem necessary to comply with your brand image. If you provide the influencer with assets include the link to the asset in the contract.
As we saw above responsibility for regulatory compliance in some cases may fall on the brand as well as on the influencer. Even if the country you operate in doesn’t have such clauses including a chapter on regulatory compliance and how it should be carried out is going to position you above any possible accusation of questionable, or straight-up illegal, practices.
Having a creator sponsor your brand and a similar brand in a short amount of time is going to tarnish the image of your brand, may lead to confusion in the customers, and lose most of the genuine feeling that influencers can generate. Therefore is important to introduce a clause that clearly states a period of exclusivity in which the content creator cannot sponsor similar products.
Since the content is going to present your brand to an audience you want to have a look at it before it goes live. Be sure that you want to be able to review the content in its integrity: photos, videos, captions, and eventually pinned comments from the creator. You can also state how many times the content can be up for modification before the contract expires, consider introducing a Mutual Rescission and Release Agreement if that is the case.
You may want to write down which kind of infractions are going to translate into withholding a part, or the whole, of the payment. This can be connected to not following the previous points or to other factors like publishing content deemed inappropriate by your brand or public scandal making the collaboration with the influencer undesirable.
If you plan to use the content created by the influencer on your website or other owned channels be sure to include a clause that allows you to do so. Even if the content is paid for by you by default the content creator is the sole owner of that content copyrights. You may structure this part in a separate Copyright License Agreement.
Comes as no surprise that payment can be one of the main causes of contention and turn into nasty lawsuits. This is why you should be extremely clear and upfront about the payment model and how is going to be carried out.
With this model, the total retribution is based on the number of views/impressions. You will also have to require the influencer to share their analytics dashboard to verify the results yourself. In the contract need to be clearly stated the CPM you are going to pay for and the time frame at which the total will be calculated. For example, you may agree on a CPM of $30 and the total to be counted a month after publication. If at the established date the content has 1M views you the content creator will be entitled to $30.000.
In this case, you agree on a price for a piece of content independent of the number of views or impressions it is going to receive. In this format is only needed to be specified the amount that is going to be paid.
Most campaigns provide influencers with personalized links or promotional codes from which is possible to track how many conversions are directly traceable to them making it possible to connect the payment to the conversions as a percentage of the revenue obtained from that specific content or a flat rate for each client they brought in.
You may want to shield yourself from poorly performing content, especially if is the first time you work with a creator or you are unsure of their results. To do so you can include a clause that requires a certain amount of views/impressions for the payment to be made. Similarly with the CPM model is necessary to provide a time frame after which is going to be established if the goal has been reached. In case of failure, you may want also to establish what the consequence will be: generally required an extra piece of content or no payment.
Many payment methods, especially if international, require fees to be paid, be sure to clearly state who is going to be liable for such fees.
Timeline for the payment
As we saw above sometimes is necessary for the kind of payment to have a timeline stating exactly how much in the future compensation will be provided. But even when it comes to flat rate deals is good practice to withhold the payment until after the content has been published or even after when the Content Availability established period has passed. Otherwise, especially if the content you are requiring is expensive to produce you may structure a deal in which a part of the payment is done before and a part is done afterward. A third option may be to use an escrow account that will release the money only after the contract requirements have been fulfilled.
Include a confidentiality clause to prevent the terms of the contract to be made public and allow competitors to take advantage of it.
An indemnification clause can prevent having to go through expensive legal ways to figure out who is responsible for potential harm or losses that emerged from the partnership.
A no assignment clause is going to prevent both parties from transferring rights and obligations derived from the contract to other entities. If included may be important to outline what will happen in case the brand is acquired by another entity.
Introducing a Force Majeure clause is going to shelter both parties in case their obligations are not met because of unforeseeable events that bring severe disruption.
To avoid having to go through a court in case of litigation you may want to introduce an arbitration clause delining an arbitration process to be followed to resolve eventual disputes. Be careful since some jurisdictions do not allow arbitration clauses or limit their scope.