Whether it’s on Instagram, TikTok, Pinterest or Facebook, influencer marketing has become an increasingly popular way for businesses to reach potential customers.
However, since always more people are engaging in this type of marketing and business, it’s become important to also regulate it. That’s why the Federal Trade Commission (FTC) has issued its influencers guidelines, to enhance transparency in the use of influencers marketing.
In this article, we’ll go through the latest FTC Guidelines for Influencers and explain everything you need to know about it.
In short
- What is an Influencer FTC?
- What are the FTC Rules for Influencers and Branded Content?
- What is the Penalty for Influencers in the FTC?
- How to Disclose Brand Relationships Under the FTC Influencer Guidelines
- FTC Sponsored Content: Pictures, Video, and Live Streams
What is an Influencer FTC?
Under the FTC social media guidelines, an influencer is defined as anyone who works with brands to recommend or endorse products.
If you’re an influencer, it is your responsibility to disclose to your followers any endorsement that consists of a “material connection” with the brand.
A “material connection” is not limited to direct payments, but it can also include:
- a personal or family relationship;
- an employment relationship;
- or a financial relationship, which doesn’t include only direct payments. Financial relationship also means that the company gives you a free or discounted product/service, makes you eligible for a price, or that you make a percentage off each sale (in the case of affiliates).
On the other hand, if you don’t have a material connection with a brand and you’re just recommending a product or service that you like, you don’t need to declare anything.
What are the FTC Rules for Influencers and Branded Content?
The Federal Trade Commission issued its influencer guidelines to stop deceiving advertising.
Transparency is of the utmost importance here. So if you’re a business using influencer marketing or you’re an influencer sponsoring a product, you always need to disclose that. A clear and conspicuous disclosure ensures that consumers are aware of your endorsement and they can weigh its value independently.
Keep in mind that an endorsement isn’t limited to a direct post on social media platforms, but it can also include tags, likes, pins, and similar ways of showing that you like a brand or product.
The FTC influencers guidelines are meant for a US public, but they can apply abroad if “it’s reasonably foreseeable that the post will affect U.S. consumers”. At the same time, foreign laws can apply to US businesses.
What is the Penalty for Influencers in the FTC?
Not complying with these guidelines means that the Federal Trade Commission can take enforcement action against you. These actions can include fines, legal action, and cease and desist orders.
For example, in 2017, the FTC settled with Lord & Taylor over its influencer marketing campaign. Lord & Taylor paid 50 online fashion influencers to post Instagram pictures of themselves wearing the same dress from the new collection, but failed to disclose they had given each influencer the dress, as well as thousands of dollars, in exchange for their endorsement.
How to Disclose Brand Relationships under the FTC Influencer Guidelines
Once you get the job and sign a contract with a brand, there are a few best practices you need to follow:
Always disclose a material connection
- If it’s a picture or an Instagram or Snapchat story, use consistent language and hashtags, such as #sponsored or #ad.
- If it’s a video or a podcast, make sure to mention the endorsement at the beginning, and maybe repeat it throughout your video or podcast.
- Use simple and clear language and don’t be ambiguous. Simply saying “Thank you” isn’t a clear sign of endorsement.
Make your disclosure hard to miss
- Place the disclosure with the message of endorsement.
- If you’re using an hashtag to disclose the endorsement, don’t hide it in a group of hashtags and links.
- Place it in a way that people can easily read it.
Be transparent
- Don’t recommend a service or product you haven’t tried.
- If you didn’t like the product you’re sponsoring, don’t exaggerate its qualities.
- Don’t make absurd claims. For example, don’t claim a product can have a benefit on your health if it’s not scientifically proven.
Understand which regional/national privacy laws apply to you
- If you have an international public, you need to be aware of other laws or guidelines that can apply to you.
- Besides consumer laws, other laws can apply to you, especially if you have a website.
Below are some best practices, as well as what not to do to avoid penalties or fines:
| Guideline | What to Do ✅ | What to Avoid ❌ |
|---|---|---|
| Always disclose a material connection | Use consistent language and hashtags like #sponsored or #ad in pictures; mention the endorsement clearly at the beginning of videos and podcasts. | Using ambiguous language like ‘Thank you’ which doesn’t clearly indicate an endorsement. |
| Make your disclosure hard to miss | Place the disclosure alongside the endorsement message; use clear and distinct hashtags like #ad at the beginning of a group of hashtags. | Burying the disclosure in a cluster of hashtags or links where it can be overlooked. |
| Be transparent | Only endorse products you have actually used and liked; be honest about your experience; avoid making scientifically unproven claims. | Recommending products you haven’t used or don’t like; exaggerating product qualities; making false claims about benefits. |
| Understand which regional/national privacy laws apply | Be aware of and comply with consumer and privacy laws in all regions where your audience resides. | Ignoring laws from other regions or countries that could affect your international audience. |
FTC Sponsored Content: Pictures, Video, and Live Streams
The FTC Influencer Guidelines provide specific instructions on how to disclose the endorsement when using different types of content or platforms.
| Content | Guidelines |
|---|---|
| Stories | Add the disclosure above the image and make sure viewers have enough time to notice and read it. |
| Pictures | Make the disclosure clear with hashtags and appropriate language, and place it where it can be easily read (for example, at the top of the post). |
| Video | Make the disclosure both in writing and verbally. Mention it in your video and add it to the description. |
| Live Streams | Repeat the disclosure periodically during the live stream, so that people who only see a part of it can understand that you’re endorsing a brand. |
As a marketer, you need to keep in mind that there are many guidelines and laws regulating your business. And it can be hard to keep up!
So let’s recap what we’ve said so far:
- the FTC Influencers Guidelines apply to you if you’re an influencer in the US or if you have followers in the US;
- a disclosure is always needed when you receive any type of benefit from a sponsorship;
- make your disclosures clear and hard to miss;
- check other laws apply, too.
We can help you with this last point!
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