Influencer Marketing Compliance: 3 Top Tips
In the realm of digital marketing, an in-depth understanding of influencer marketing compliance is gaining importance; especially as, facing the surge in traditional advertising expenses and noticing a trend in consumer inclination towards influencer suggestions, an overwhelming majority of brands (about 71%) are forecasting a more prominent role for influencers in their comprehensive digital marketing strategies.
Currently, only about 4% of the substantial $667 billion global digital advertising budget is being channeled into influencer marketing.
Expect big growth in these numbers.
But do your due diligence on influencer marketing compliance first.
Tip 1. Put a contract in place to protect the brand, the influencer and the audience…
Navigating the landscape of influencer marketing compliance necessitates that when working with an influencer possessing a significant following, it’s advisable to engage through their agent. Establishing a contract is essential for maintaining transparency and clarity for all parties involved, embodying the principles of influencer marketing compliance.
There’s no need to involve a law firm for this process. Instead, consider partnering with Pimento, a full service agency equipped with a network of specialist agencies in the area of Influencer Marketing compliance such as PromoVeritas. They are adept at crafting contracts that cater to your specific needs. The responsibility of adhering to regulations, while partially guided by the influencer’s agent, ultimately lies with the brand. This ensures a comprehensive understanding and adherence to the necessary guidelines.
Clear, concise contracts and detailed briefs, outlining the exact requirements for each post, are key to fostering a transparent and effective working relationship, ensuring everyone is on the same page.
Tip 2. Understand the rules & regulations of Influencer Marketing compliance and who is responsible for what
The Consumer Protection from Unfair Trading Regulations 2008, commonly known as CPR, sets forth specific guidelines regarding influencer marketing:
CPR Rule 11 emphasises the prohibition of utilising editorial content for product promotion if a brand has financed it, without clear disclosure within the content. This disclosure can be made through text, images or auditory cues.
CPR Rule 22 outlaws any misleading representation by influencers, specifically forbidding them from falsely portraying themselves as average consumers when they are, in fact, endorsing a product.
The definition of ‘payment’ in this context is broad, encompassing various forms:
- Direct monetary compensation or credit.
- Receipt of products or services at no cost.
- Temporary use of a product or service, either as a loan or a gift.
- Earning a commission or receiving any other form of incentive.
Disclosure of a commercial relationship is mandated in situations where:
- The influencer has received any form of payment, be it cash, credit or complimentary products or services from the brand.
- There has been a commercial relationship between the brand and the influencer within the last 12 months, counted from the conclusion of their most recent contractual agreement.
The Competition and Markets Authority (CMA), serving as the United Kingdom’s competition regulator and a government entity, has issued comprehensive guidance for both brands and influencers on the nuances of influencer marketing. This guidance specifies:
- When tagging a brand or business in any format, such as text, pictures or videos, influencers are required to provide additional disclosure.
- Similarly, tagging gifts demands further disclosure.
- The use of discount codes in a post mandates extra clarity.
- Posts that are paid for must be explicitly labelled as such.
- Influencers should avoid using ambiguous hashtags, for example, hashtags like #sp, #spon, #client, #collab are discouraged. Additionally, placing #ad immediately following a brand or business name (e.g., #[BRANDNAME]ad), or burying #ad within a post where it might be overlooked, is not advised.
Looking ahead, regulatory oversight on influencer marketing is set to intensify with the impending Digital Markets, Competition and Consumer Bill, slated to be enacted in mid to late 2024. This bill will empower the CMA with the authority to determine violations of consumer protection laws and to levy fines up to 10% of the annual turnover for those who breach these regulations. When in doubt, the safest approach is to use #ad.
Tip 3. Influencer Promotions must also comply with CAP Code rules…
Whether an on-pack promotion or being run with an influencer, a promotion with prizes such as instant wins, prize draws and competitions should comply with the CAP Code rules.
The promotor (whoever is running the promotion) should ensure:
Prize promotions are administered correctly and treat consumers fairly.
Prize draw winners are chosen using the laws of chance. If this is not done by a verifiably random computer process, there must be an independent observer.
Competitions (which involve an element of skill) must have an independent judge.
Prize promotions are an effective but often resource intensive marketing practice which carries an element of risk for the promotor if not run in compliance with local rules and regulations.
As a specialist and independent prize promotions agency, Pimento Member agency, PromoVeritas have successfully managed more than 16,000 promotions, awarded more than £35 million in prize value and have a dedicated and experienced in-house Legal team.
Their team can provide a legal review of marketing communications, prepare suitable Terms and Conditions and contract agreements, and offer complimentary Compliance Training to brands and their agencies. They tailor the session to your needs covering best marketing practices including Influencer Marketing in the UK, EU and globally.
Resources
We have collated a range of useful resources which you should review ahead of any campaign:
- A Checklist for Influencers and Brands – Checklist 6 (asa.org.uk)
- Hidden ads: Being clear with your audience
- Business Responsibility and Social Media Endorsements
We would love to have a no obligations chat, send us an email or give us a call.
The Importance of Influencer Marketing
The power and importance of influencer marketing is undoubtedly (still) on the rise, thanks to the central role that social […]
Read more.
Creating talkability for brands – The World of PR, Social & Influencer Marketing
The World of Social continues to evolve on an almost daily basis. We all experienced the recent Facebook, WhatsApp and […]
Read more.