Influencer marketing has changed the game in advertising. In the past, this space was dominated by a handful of celebrity endorsers, but with the rise of the Internet and social media, all of that has changed. 

Now there are thousands of influencers out there who have carved out a name for themselves in their niche and have grown massive followings on social media. Working with influencers can often provide brands with a highly targeted audience to advertise their products and services to. 

However, how are consumers supposed to know if the post they are looking at is an advertisement or not? Influencer marketing brings up several ethical concerns that both brands and influencers must address to stay compliant with FTC guidelines and avoid penalties. The FTC requires that influencers be transparent about their relationships with brands.

Several firms have faced expensive lawsuits recently due to a lack of disclosure of their relationship with influencers.

In April of last year, the FTC sent 90 letters out to influencers, reminding them they need to disclose their monetary connection to brands in their posts. 

Here's what the letter had to say about influencer disclosure obligations:

The FTC's Endorsement Guides say that if there is a "material connection" between an endorser and an advertiser - in other words, a connection that might affect the weight or credibility that consumers give the endorsement - that connection should be clearly and conspicuously disclosed, unless it is already clear from the context of the communication. A material connection could be a business or family relationship, monetary payment, or the gift of a free product. Important: The Endorsement Guides apply to both marketers and endorsers.

If your brand is considering influencer marketing or already working with influencers, there are several things to keep in mind to ensure your campaigns are ethical and FTC-compliant. 

1) Every post must have a disclosure. 

Use hashtags in posts on social media to disclose the relationship. I recommend including either #advertisement or #sponsored. The FTC requires that you put the disclosure in the first three lines of your post on social media. In other words, don't bury the disclosure in a long list of hashtags or fine print somewhere.  

Similarly, bloggers, vloggers, and podcasters must follow the FTC's guidelines on endorsements by disclosing the relationship with brands they recommend.

2) Sign agreements that require disclosure from influencers.

When your company contracts with an influencer, make sure that the contract they sign requires them to disclose the relationship in their posts. Never assume that they will just do it, as other brands they've worked with in the past may not have required them to do so.

3) Develop consistent guidelines.

Clear guidelines should be developed and distributed to influencers so they know what they can and cannot post.

Influencers become an extension of your company's marketing department. You need to ensure that their posts align with your company's brand message and remain within the realm of possible achievable results with your product or service. If an influencer shares a story that goes beyond the advertised benefits of your brand, make sure it is made clear in the post that the results are not typical. 

4) Use built-in disclosure tools where available.

Facebook, Instagram, and YouTube have built-in tools designed to help make following FTC guidelines much easier for brands and influencers. I expect to see other social media platforms roll out similar tools this year. 

There's no denying it: Influencer marketing is here to stay. Brands are using it as an essential piece of their marketing strategy. However, since the influencer space has changed so fast over the last few years, it's easy for brands to have unforeseen issues.

The FTC has made it clear that they are serious about enforcing the rules. The time is now to make sure your brand complies.

Published on: Feb 12, 2018