Use of influencer marketing agreements – key considerations

In today’s digital age, influencer marketing has become a powerful strategy for various brands, affording them the ability to market their products and services and expand their reach while connecting with specific target audiences.

However, brands will often forget about an important aspect of this engagement – having an influencer marketing agreement, sometimes known as a social media brand ambassador agreement, in place. It is imperative to have a well-drafted agreement that outlines both parties’ obligations under the arrangement from the outset, to ensure that everyone’s interests are adequately protected.

What should be included in an influencer agreement?

1. Define the scope of work, performance metrics and reporting

One of the first steps to take is to clearly outline the specifics of the influencer’s role. This includes:

• Content deliverables: specify what type of content the influencer is to deliver, for example posts, videos and stories and what quantity is required
• Platforms: indicate the social media platforms where the influencer will post the content – for example Instagram, TikTok, YouTube and X
• Deadlines: provide clear timelines for when content would need to be submitted and published.

Having these points explicitly detailed within the agreement helps avoid misunderstandings and ensures that both parties are aligned on their respective expectations. Having a bespoke agreement will also afford the ability to reflect and accommodate for the different ways that influencers may promote themselves and reach their followers, whilst still setting out the framework of the services to be provided by the influencer.

Also, be sure to clearly define how the influencer’s success will be measured and tracked. This could be through:

• Key metrics: including engagement rates, impressions, clicks, or conversions as benchmarks
• Reporting requirements: request periodic analytics or screenshots from the influencer to verify performance data
• Evaluation: include a provision allowing for mid-campaign adjustments based on performance insights.

2. Compensation and payment terms

Compensation can take various forms. These include flat fees, performance-based payments, free products, or a combination of these. Whatever form of payment is chosen, be sure to make explicit reference to the following within the remuneration provision:

• Payment structure: how the payment will be made to the influencer and whether it will be made upfront, upon content delivery, or after the campaign concludes
• Expenses: clarify if additional costs like travel, meals or production expenses will be reimbursed
• Bonuses: where applicable, include provisions for performance incentives whereby the influencer exceeds their performance or engagement metrics.

3. Usage and ownership rights

It is also key to determine from the outset who will own and have rights to the content created during the relationship. This could be you as a brand owner, the influencer, or a situation where there are joint rights of ownership.

If there are any limitations to usage rights, these should be specified within the agreement by stating how the content can be used, where it can be used – for example on the brand’s websites, advertisements or social media – and for how long.

Finally, consider whether any exclusivity restrictions should be imposed on the influencer, for example excluding them from promoting competing products or services for a specified period. However, to ensure that such restrictions are legally enforceable, the provisions would require careful drafting to ensure they do not operate in an overly restrictive manner.

4. Brand guidelines and compliance

Brands must ensure that influencer content aligns with their internal values. This can be done by providing the influencer with the brand’s “style guide” or key messaging points which will help in maintaining consistency.

Brands must also ensure that the influencer complies with relevant regulations in producing and delivering their content. Influencer marketing in the UK is regulated by:

• The Competition and Markets Authority (“CMA”) – the UK’s primary competition and consumer authority
• The Advertising Standard’s Authority (“ASA”) – the UK’s independent advertising regulator
• The Committee of Advertising Practice (“CAP”) – the sister organisation of the ASA who are responsible for writing the UK Advertising Codes
• The Financial Conduct Authority (“FCA”) – provides guidance and set expectations for brands and influencers about financial promotions on social media.

The relevant regulations and codes are:

• The Consumer Protection from Unfair Trading Regulations 2008 (“CPR”)
• The UK Code of Non-broadcast Advertising and Direct & Promotional Marketing (CAP Code).

The key points under the CAP Code when it comes to social media marketing are that it requires the communications to:

1. Be obviously identifiable as advertising. For example, the influencer could explicitly use hashtags like “#ad” or “#sponsored” within their post
2. Not mislead
3. Make it clear that the influencer is acting commercially and not as a consumer.

Influencer regulatory framework should be at the forefront of a brand’s considerations. If an influencer is in breach of the legal and regulatory framework for social media marketing, not only will they be individually responsible, but the brand working with the influencer will be equally responsible.

Accordingly, the ASA has warned that both influencers and the advertisers paying for the social media posts will be targeted to ensure greater compliance with the UK legal and regulatory

framework for influencer marketing. This is due to the frequency of breaches in consumer and advertising laws in non-broadcast and direct and promotional marketing.

In addition to this, brands which fail to comply with the influencer regulatory framework may, as a consequence, find themselves being ‘named and shamed’ on the ASA or CAP website and in media coverage, which may result in reputational damage to the brand.

5. Termination and conflict resolution

Potential challenges should be anticipated and addressed, including:

• Termination clauses: outline conditions for terminating the agreement. These include non-performance, breach of contract, or any other act whereby the influencer causes any reputational damage for the brand
• Refunds or penalties: brands should include provisions for recouping fees if the influencer fails to deliver
• Dispute resolution: specify from the outset how conflicts will be resolved, for example through arbitration prior to pursuing legal action.

6. Confidentiality and non-disclosure

A brand will wish to retain sensitive information and safeguard its trade secrets, campaign strategies, and any other confidential information shared with the influencer during the course of the engagement. This can be done by including confidentiality provisions within the agreement, or where necessary, by entering into a separate non-disclosure agreement (“NDA”) with the influencer prior to engaging them.

7. Insurance and liability

Some campaigns involve risks, such as on-site shoots or physical product testing. Consider having provisions within the agreement obliging the influencer to carry adequate liability insurance dependent on the type of campaign. Indemnity clauses that would protect the brand from certain legal claims related to the influencer’s actions or content can also be included. Having these provisions in place would help to protect from unforeseen liabilities that may arise during the course of the engagement.

8. Intellectual property

Some aspects of the social media posts may be subject to copyright protection, trademark protection or both. Accordingly, there should be a clear intellectual property (“IP”) strategy, with the agreement making it clear who owns the IP, who is licensed to use it, how they are permitted to use it and for how long. Unless the intellectual property of the final content which the influencer produces is owned by the brand, or the brand has an irrevocable licence to use it, the value of the influencer to the brand may be far more limited than envisaged.

What does this mean for brands?

Negotiating an influencer agreement requires careful attention to detail and a mutual understanding of each party’s roles, responsibilities, and expectations. A well-structured agreement not only safeguards both parties, but also lays the foundations for a successful and enduring partnership. By addressing these key considerations, brands and influencers can collaborate effectively.