What Brands Need To Know About The FTC’s Influencer Guidelines

Like any form of commercial advertising, influencer marketing requires disclosures for monetary relationships. In the United States, the FTC (also known as the Federal Trade Commission) is responsible for “protecting consumers from unfair and deceptive practices in the marketplace”. In the social media marketing world, this means that brand relationships need to be disclosed clearly.

Today, we are breaking down everything you need to know about when to disclose brand partnerships, acceptable and unacceptable ways to disclose, and why greater ad transparency helps all parties involved. 

Note: As Lytehouse is based in the United States, this is a guide for US-based campaigns. If you are managing a campaign in a different country, check their regulations and guidelines regarding influencer partnerships so you are using proper disclosure language. 

Why Should I Care About FTC Guidelines?

Clear disclosures of brand-influencer relationships benefit all parties involved by creating transparency. 

Audience trust is crucial for influencers, so they want to be clear and transparent with their audiences about when they have paid relationships with brands. Likewise, brands should strive for honesty with both their followers and the followers of influencers with whom they partner. And third, consumers want to know when the content they see has been paid for.

Some people view paid partnership disclosures as a negative, arguing that they decrease post engagement or seem “inauthentic” but at this stage in the evolution of influencer marketing, consumers understand the ecosystem and deserve to have transparent disclosure language and obvious indicators that content is advertorial, the same way that television commercials or branded magazine editorials are clearly demarcated.

When Should A Partnership Be Disclosed?

According to the FTC’s influencer handbook, influencers need to disclose any “financial, employment, personal, or family relationship” with a brand. One important thing to note: contrary to popular belief, gifted or discounted products provided by a brand count as a financial relationship.

Dos and Don’ts of FTC Disclosure

Disclosures should be obvious and easy to find for anyone looking at the piece of content. Here are some dos and don’ts to keep in mind:

Do...make a disclosure obvious and easy to find within the branded caption or post message.

Don’t...hide disclosure language in a comment, group of hashtags, or “read more” button.

Do...place disclosures toward the beginning of a post or caption.

Don’t...assume audiences know about existing brand relationships. If an influencer posts 20 times for a brand, all 20 posts should include disclosures.

Do...require clear and easy-to-understand language like “Thanks to [brand] for gifting this product” or “This post is sponsored by [brand]” makes the brand-influencer relationship clear. Other acceptable terms to use include “advertisement”, “ad”, and “sponsored”. 

Don’t...use abbreviated or confusing terms like “sp”, “spon”, or “collab”. 

Do...use a social platform’s official partnership disclosure (like Instagram’s Paid Partnership Tool) when possible.

Don’t...ask influencers to discuss or endorse a product or experience that they have not yet tried. 

Do...include disclosures in both verbal and written form when sharing video content, and consider that many viewers watch social media videos without sound. 

Don’t...hide or minimize disclosure text on Instagram Stories or Snapchat posts. 

Who Is Responsible For Enforcing FTC Disclosures Are Added?

Both brands and influencers should hold themselves accountable for enforcing proper disclosures. Brands can do this by outlining proper disclosures in their contracts with influencers. Influencers can do this by pushing back when brands try to avoid adding disclosure language.

What Are The Repercussions of Ignoring FTC Guidelines?

The FTC has started to crack down on deceptive advertising in the influencer space, issuing warnings and fines to influencers and brands alike. Violating FTC guidelines could have significant monetary and legal consequences. Beyond that, ignoring proper disclosures will hurt your brand’s reputation as well as the influencers you partner with as social media consumers have become more wary of deceptive ads. 

At the end of the day, brand-influencer relationship disclosures make the influencer marketing industry as a whole more transparent, so we should be holding each other accountable, as the industry only stands to benefit.