In the lawless lands of classic Western movies, outlaws could go about their robberies with impunity—and in the early days of influencer marketing, popular Snapchat and Instagram users enjoyed a similar freedom to promote products without disclosing that brands were compensating them. But we aren’t in the Wild Wild West anymore.
For years, the FTC has required some form of online disclosure related to paid endorsements. And recently, the agency has ramped up its enforcement of the law, increasing the frequency of crackdowns on creators and companies that don’t follow the rules.
Agencies and brands, we know you don’t want to appear in headlines like these:
- FTC Finalizes Settlement With Warner Bros. Over Secret Influencer Marketing
- Lord & Taylor Settles FTC Charges It Deceived Consumers
- Two Celebrities Charged With Unlawfully Touting Coin Offerings
As Reuters and others have reported, the FTC’s actions over the last year or two illustrate “an escalation of the agency’s interest in so-called social media ‘influencers.’” This is no coincidence. Thanks to its proven impact and efficiency, influencer or creator marketing is an increasingly popular way for brands to reach their target audiences—and the number of influencer partnerships is increasing accordingly. Sponsored content on social media has become sufficiently ubiquitous that The Atlantic has reported on users seeking “influencer status” by faking it, sharing content that purports to be advertising when in fact no brand association exists.
Naturally, we have been paying attention. And we have knowledge to share. Below you’ll find our guide to navigating the murky waters of advertising and endorsement disclosures in influencer marketing.
When is a disclosure required?
- When any monetary compensation is issued — if you’re paying the influencer in exchange for creating and/or appearing in content published from their channels, they are required to disclose.
- When products are “gifted” — free products qualify as material compensation, and the FTC requires disclosures in content that highlights such gifts, even if the post itself is not a sponsored ad.
- Pro tip for campaign managers: include a note along when you send products to influencers, something like If you happen to mention or show the product, make sure to let your fans know that we sent this to you.
- Events — if you hire an creator to attend an in-person event, they must disclose your partnership in any content published to their account. This applies even if the influencer is “paid” with material gifts rather than a check.
- Requesting negative coverage of other brands — don’t do this. Just don’t.
What are the guidelines for disclosures?
- Most importantly, the disclosure language must be easily visible to consumers. This means it should be written in standard font and placed before any automatic cut-off, like Instagram’s “see more” format.
Simon Nessman for Aldo Shoes, May 2018
- Disclosures cannot be mixed in with a group of other hashtags. Per the FTC, “If #ad is mixed in with links or other hashtags at the end, some readers may just skip over all of that stuff.”
- The language must be easy to understand. The FTC frowns upon the use of #partner or #ambassador, because those tags are not crystal-clear disclosures to the consumer. Creators should keep it simple: #sponsored or #ad are in line with the rules.
- Pro tip for campaign managers: Require specific language and specific placement of disclosure tags from influencers in your contracts.
- For video content, disclosures should be both written and voiced over in the content (alongside the product placement).
- Platform-native features like the “Paid Partnership on Instagram” tag are new, and the rules may change, but for now the disclosure must still appear in the caption. The FTC’s current stance is that the new tag is neither explicit nor prominent enough to replace a written or spoken disclosure.
- Just to be safe, you might as well read all the requirements via the FTC website.
As with most elements of influencer or creator marketing, the rules around disclosures could change as platforms react to the increase in this type of sponsored content. Check back with us, because we’ll keep this guide updated—and help you stay on the right side of the law.