The Federal Trade Commission (FTC) is not hitting “like” on your influencer engagement campaign, and is down-voting your disclosures.
Earlier this month, the FTC released important new guidance targeted at social media influencers, in language designed to be read by non-lawyers, framing an often confusing legal issue for the people who need to understand it the most: the influencers themselves. These new guidelines, “Disclosures 101 for Social Media Influencers,” were accompanied by a video “Do you endorse things on social media?”, and are designed to show influencers how and when they must disclose material connections to brands to their followers.
This guidance builds on the FTC’s existing Endorsement Guides and a 2017 question-and-answer document, but with simplified language and clearer (and more modern) examples. It also serves as a critical reminder that the responsibility for compliance with these rules often falls on the influencer – and that sponsors are not the only focus for regulators.
So WHEN do influencers need to disclose a sponsorship? The short answer: (a) when the influencer has a material relationship with a brand, and (b) when the influencer then engages in activity on a platform that constitutes an endorsement or an ad. Influencers cannot simply assume that their followers already know about a material connection with a brand discussed in a posting.
So HOW should influencers disclose their sponsorships?
- The disclosure must be “hard to miss” – the influencer should place the disclosure with the endorsement text.
- The influencer should not mix the disclosure into a group of hashtags or links.
- The disclosure should be in the same language as the endorsement.
- For picture endorsements with time limits – like Instagram Stories and Snapchat – influencers should superimpose the disclosure over the picture and make sure viewers have enough time to notice and read it.
- For video endorsements, the disclosure should be in the video and not just in the description of the video. The disclosure should be both audio and superimposed text.
- For live stream endorsements, the disclosure should be periodically repeated throughout the stream.
While the FTC’s extraordinarily broad views of these requirements may be new to influencers accustomed to pushing the envelope over the past several years, in reality this is nothing new. Influencers have always been required to disclose a wide variety of perks and benefits – even non-monetary ones – and the FTC even considers “likes” and other indicia of endorsement as endorsements. However, the renewed focus is clearly designed to communicate a more active regulatory approach. Notably, this new guidance comes more than two years after the FTC began to increase its attention on influencer marketing, as shown by the letters sent to brands, celebrities, and influencers alerting them of disclosure requirements, and ahead of what may be a significant re-visit to the endorsement guidelines themselves in the near future.
Thus, while the substance of these guidelines seems more like a reminder than a change, in this case the medium is the message: the fact that the FTC has put out these documents, in the manner they put them out, points to a real potential for more aggressive actions by the FTC against influencers and the companies that hire them. In the meantime, both influencers and their sponsors would be well advised to review their agreements, and to take another look at their disclosures.