Enjoy this week’s guest post from lawyer, Keren de Zwart, and learn about social media sponsorship rules.
Whether you’re the business owner pitching the product or service or the influencer getting paid to promote it, social media sponsorship rules and advertisements on social media are getting tighter. Be sure you’re in the know and in compliance to avoid fines and penalties.
What’s All the Fuss About?
If you’ve been playing the sponsorship field for a while, you might have heard about how the Federal Trade Commission (FTC) cracked down in recent years and sent notices to some really big names (cough::Kardashians::cough) telling them to be more transparent about their sponsored posts or risk fines and other scary penalties.
But why are they making a big deal about it and why now? Well, in short, consumer protection. The whole purpose behind the FTC is to ensure transparency in commerce and to protect consumers. They’re regulating everything from the National Do Not Call List to approving mergers of major corporations and ensuring they’re not violating antitrust rules.
While you–as a business using social media to promote your product or service or as an influencer using your following and relationships to share great finds with the world and get paid for it–may understand how the world of sponsorship deals works, the reality is that most consumers out there don’t really get it. If they follow influencers, it’s because they enjoy the content and like learning about new products, trends, restaurants, etc. That’s what makes influencers such incredible marketing tools.
But in today’s world, with influencers having tens of thousands or even millions of loyal followers who will purchase anything and everything the influencer hawks, the FTC wants to make sure consumers have all the information before… Share on XWhat are the Social Media Sponsorship Rules?
The rules are being formed as the industry unfolds, so what holds true today might not hold true 6 months or a few years from now. It’s important to keep up on the rules to ensure you’re compliant.
BE UP FRONT
The key here is that the FTC doesn’t like anything that makes it hard for the consumer to understand the relationship. Your yoga mat might really, truthfully be the best yoga mat to ever hit the market, and the influencer paid to promote it might actually think that. But that doesn’t mean they can skip the part where they share with their followers that they got it for free or are being paid to promote it. If there’s a connection between you and the promoter (payment, free product/service, ownership in company, affiliate links) it needs to be disclosed.
SPELL IT OUT CLEARLY
Don’t use vague terms like #collab, #thanks, #sp. It has to say exactly what it is. Cater to the lowest common denominator. Generally acceptable versions include: #ad, #sponsored, #sponsoredpost, #paidcollaboration.
PUT THE DISCLOSURE WHERE CONSUMERS CAN FIND IT
So you have a sponsored post that looks fab, meets all the Instagram algorithm checkboxes with lots of quality content in the form of a 3-paragraph swoonfest of your product, and the influencer adds the hashtag #ad as one of his or her 30 hashtags? Good deal, right? Wrong!
Don’t bury that disclosure in the list of 30 hashtags. It needs to be up front, separated from the sea of hashtags. And something that people get wrong all the time is that the disclosure has to be before the ellipses that a user has to click on to see the rest of the content. That means when users are just scrolling through their Instagram feed, they can see within those first two lines that it’s sponsored content.
If you are working on a sponsored post for Instagram stories or Snapchat and there isn’t a place to add written content, it should be included directly on the story.
Who is Responsible?
It is both the business’ and the influencer’s job to comply with the rules. Both can be fined for failure to comply. So how do you ensure the legal action by the other party? Get it in writing. Have an agreement written and ensure that there is a list of acceptable and prohibited actions and/or omissions in the posts.
But Nobody Else is Following the Rules!
Forgive me for sounding like a parent–I do parent two little ones on a daily basis after all–but if all your friends were jumping off a cliff would you follow? Here are a few great reminders for you:
Ignorance of the law is not a defense. “But I didn’t know!” is not a defense to breaking the law and violating rules. It’s your job to stay abreast of these things. Share on XEveryone is doing it. This might be true. I regularly see very, very popular influencers on social media getting it wrong–sometimes in small ways like putting #ad at the very end of a 5-paragraph review of their latest hotel stay–but that doesn’t mean you can’t get in trouble for it. Can you tell the officer that pulled you over for speeding that you shouldn’t get a ticket because there were dozens of other cars speeding on the road? Nope. You can only be responsible for your actions and those with whom you contract to promote your business.
Want an easy-to-remember break down of social media sponsorship rules? The FTC just came out with this handy guideline to ensure you are promoting your business legally online.
After working for 10 years in the corporate arena, Keren had a desire to fill the legal gap for entrepreneurs and small businesses by replacing the outdated billable hour model with flat-fee pricing. With a decade of experience in corporate transactions, Keren has worked with every type of business: from side hustlers to raising millions of dollars and taking companies public. Today, she helps entrepreneurs get #legallylegit through her law firm, Not Your Father’s Lawyer. She resides in Orange County, California, with her husband and two children. Follow Keren on Instagram, Facebook, and check out other relevant blog posts for small businesses here.