As consumer products and services companies continually seek to find ways to market to their consumer base, over the last several years, many companies have begun relying on social media influencers to promote their products and services online. In this post, we’ll discuss some key areas a contract drafter may consider when drafting a social media influencer agreement on behalf of a company.
Key Considerations
Generally, social media influencer agreements function like standard professional services agreements, where a company will provide compensation in exchange for an influencer performing certain promotional services in support of the company’s products or services on social media sites. However, in addition to including the standard boilerplate terms and conditions that one normally sees in a professional services agreement, a contract drafter should likely consider including the following key clauses in its social media influencer agreements:
- Requirements that the influencer comply with all applicable laws, rules, and regulations, including the US Federal Trade Commission’s rules
- Specifically, all social media posts regarding the company and/or its products and services should clearly and conspicuously disclose the influencer’s connection with the company by including necessary disclosure statements (e.g., #ad, #sponsored)
- Requirements that the influencer comply with the terms and conditions of the social media sites where the influencer will be making social media posts promoting the company’s products or services
- The right for the company to have final review and approval of all social media posts prior to being posted online, and the right to have any post taken down by the influencer at any time
- A non-disparagement clause that does not permit the influencer to denigrate or disparage the company or its products or services
- A morals clause that allows the company to immediately terminate the agreement with cause in the event the influencer is accused of a crime or otherwise engages in behavior that would have an adverse effect on the company’s reputation, brand, and/or the products or services
- A legal representation clause that expressly states that the influencer has had the opportunity to consult legal counsel during the negotiation of the agreement and understands the terms and conditions therein
Project-Specific Issues
In addition to the key considerations above, a contract drafter may need to consider the following project-specific questions on a case-by-case basis in its social media influencer agreements:
- Is the company entering into the agreement directly with the influencer or with a lender that has the authority to bind the influencer to the contract and cause the influencer to provide the promotional services?
- If a lender is being used, then what representations and warranties should be made by both the lender and the influencer?
- Will there need to be an exclusivity component that limits the influencer from promoting products and services that are competitive with those of the contracting company?
- If there is exclusivity, then what is the scope?
- What type of license rights will be granted to the influencer to use the company’s logos and trademarks?
- Will the influencer be allowed to keep social media posts using the company’s logos and trademarks indefinitely, will such use be time-barred, or will the company have takedown rights?
- What type of license rights the company requires in influencer’s content, image, voice, or likeness?
- Will the company be allowed to mention the influencer as the ambassador of the brand in the broader marketing campaign? Will the influencer be required to attend promotional events organized by the company and, if yes, on what terms?
The aforementioned are just a handful of items for a contract drafter to consider when sitting down to build an influencer agreement. Come back next week for part two of our series, where we’ll discuss considerations when drafting influencer agreements on behalf of an influencer.