How to Draft An Influencer Agreement

by | Jul 28, 2019

Influencers have become the new celebrities of advertising. With powerful public opinions, they can assist with increasing market share for products, ideas, and services. Influencers are often ordinary people, who have the ability to influence potential buyers of a product or service by promoting or recommending the items on social media. It has become very common for businesses to approach these people to ask them to test or promote a product by talking about the brand on their chosen social media platform in exchange for some sort of—usually monetary—compensation.

The informality of this form of advertising is what attracts the average consumer. Social media recommendations are often considered more trustworthy than large-scale advertising campaigns. The public at large finds it more believable when an “ordinary person” (i.e., the influencer) recommends a product compared with, for example, a major international celebrity who has been paid millions of dollars to plug the same item. Influencer ads are perceived as more akin to when a friend or family member recommends a product that has worked for the brand.

However, this same informality that attracts potential consumers is also the downfall of influencer marketing. In the past, businesses have complained that influencers, who are often individuals without any form of representation, legal or otherwise, don’t read the contracts that they have signed. When they inevitably end up in breach of contract by ignoring deadlines for social media posts, businesses have had to turn to litigation in order attempt specific performance of the contract or seek damages, which could includ compensatory, actual/general, liquidated or other types of restitution.

With the power of influencers growing and the number of influencer-business transactions multiplying on a daily basis, it is becoming more and more important for both businesses and the individual influencer to protect themselves legally. Accordingly, putting in place a contract is becoming a much more important part of the deal.

When drafting influencer agreements, the main goals should be to help clients avoid costly litigation, but also to negotiate with the other party to obtain the most favorable legal terms possible for the client. A successful influencer agreement will, at the very least, help the parties understand what they have to do, be aware of any deadlines, and understand payment terms

When it comes to helping a business that is looking to start an influencer marketing campaign, the brand must be protected. It is important to make businesses aware of the importance of protecting their investment in the influencer and protecting their intellectual property. Added services might include assisting the client with vetting and conducting due diligence on the potential influencer to ensure that the influencer will be able to provide the social media reach that the business is looking for. Furthermore, it is important for the business to know how to draft a structured payment system to pay for the performance by the influencer.

Some important terms that need to be brought to the attention of both parties might include:

  • Who are the parties to the agreement? In most cases, this will be the influencer and the business. Make it clear to the influencer that this is a relationship with a corporate entity. Any third parties involved need to be discussed as well.
  • What is the purpose of the agreement? Make sure your clients understand why they are being paid or paying for the service offered. The performance is the publication of a social media post, but the reason is most likely to increase consumer awareness of a product or service.
  • What are the services that need to be provided by one or both parties? Make sure both parties understand exactly what they need to do to fulfill their obligations under the contract.
  •  What is the timeline for completion? Make both parties aware of deadlines and the consequences of missing deadlines
  • What are the fees for the services? Make sure it is absolutely clear what each party will receive in return for their work.
  • What are the terms for termination? How can each party extract themselves from the agreement? What is considered breach or default? Make sure the parties are aware of any actions that might result in a breach of contract, particularly if these might not be obvious to the average lay person.
  • What intellectual property is involved? A limited use license will likely need to be included.

Keep in mind that a lawyer’s job in drafting an influencer agreement, as with any agreement, is to protect the interests of the client and to facilitate the client getting what they want out of the deal—without killing the deal before it has even begun. It is a delicate balance of negotiating to get the best terms for your client, while keeping all parties to the contract happy, and most importantly, aware of their obligations – a win-win situation.

We have drafted many influencer agreements, both on behalf of companies and on behalf of influencers. We will be happy to either review your existing agreements or draft new ones. If you would like to take matters into your own hands, you can find an Influencer Law video on LawTake.com.  LawTake is a website that aggregates legal content to help people with their legal issues.

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