Avoid The Influencer Landmines And Fines

(By Gil Gerretsen) For years, entrepreneurs and marketers have been seeking ways to use social influencers to boost their brands. In like manner, many hopeful influencers have been seeking brands that can provide them with a lucrative income stream.

But beware!

Most folks don't seem to know that there are stringent laws about these type of relationships.

You could land in serious legal trouble if you don’t go down this path in the right way.

Here's why. In August 2023, the Federal Trade Commission (FTC) introduced new guidelines that apply whenever an influencer or content creator has a "material connection" with a brand.

What is a material connection? The FTC defines it as any relationship or activity that could modify an influencer's opinion or endorsement of a product or service. It can be things like free products or services, discounts, payments, family relationships, personal relationships, or even an employment relationship.

If you are hiring influencers, or if you are seeking to work as one, then you must be aware that the FTC requires clear and conspicuous disclosure of the relationship to prevent deceptive advertising practices. Those disclosures must be transparent, prominently displayed, and easily understood by ordinary consumers. You can't hide them in fine print.

If you are using influencers, planning to do so, or hoping to become an influencer, then it is important to get proper legal advice. There are guidelines you should know and discuss with your attorney regarding proper and improper words, phrases, and practices.

Failure to get proper legal counsel can be very costly. The FTC is cracking down hard, and the penalties are significant! Deceptive influencer practices, including fake endorsements, can carry fines as large as $53,000 per violation!

It can be tricky using an influencer, or being an influencer, but it can also be a powerful marketing tool if done right. Just stay informed about the constantly shifting guidelines.

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