On June 29th, 2023, FTC announced major changes to its online and influencer marketing regulations. Even worse for potential regulation flaunters, the FTC pushed the maximum penalty for each violation from $46,517 to $50,120. We’ve seen even the biggest celebrities get dinged for violations, too, though the FTC has shown it will go after small influencers just as readily.
Even more importantly for companies engaging with non-compliant influencers, the brands they’re promoting can be held liable for damage.
In part 1 of this guide, we caught a top-level view of the FTC changes and described the latest “do’s” and “don’ts” of influencer marketing. In part 2, we’re going to dive a little deeper, looking at how these changes will affect all of the pillars of influencer marketing.
And, speaking of honest disclosure: we have to let you know this isn't official legal advice.
One of the strongest pillars of influencer marketing is the simple review. The endorsement, the “hey try this cool thing.” People trust influencers, for the most part, to be giving honest opinions about the products they try. This is why the FTC is coming down so hard on reviews in their latest guidelines.
Incentivized reviews from influencers are under close scrutiny now. The new rules state that when working with influencers of any kind (or anyone at all), a free sample or other access to your product can not be conditional upon a good review.
Now, you can still send a product to an influencer on the condition of a review, but we aren’t allowed to say how they review it. A positive review can’t be a stipulation of the transaction. What’s even more tricky is that you can’t even imply that a positive review is part of the deal, so any language you use for the deal needs to be extremely precise.
If the influencer or the FTC is able to read even a vague implication of a promise of a positive review, there could be trouble.
Reviews have to be honest, and the FTC will check the receipts. The first definition of “honest” is that the review has to be from people who have actually tried the product.
The second definition of “honest” is that if the product you tried is bad, you can’t say it’s good. An influencer has sway over consumers, and the FTC considers them a legitimate and regulated source of information. Influencers caught praising products they had bad experiences with are flirting with fines.
The third way reviews have to be honest is that the claims made in them have to be true. Especially for health products or even health-adjacent products. If the person delivering the review on social media or on a website starts making claims about your product, even if your brand never made those claims, you could still get tagged for it.
Maybe you never said your tea will cure the common cold, but if an influencer you paid does, the FTC could come knocking.
None of these “honest” transactions are easy to prove (one way or the other), but as usual, honesty is the best policy. There’s no way to get caught red-handed telling the truth.
In a further expansion of “honesty is the best policy,” influencers are going to have to include way more disclosure than they did previously.
What has to be disclosed in influencer content:
And unfortunately, we can’t just rely on the tools built into social media platforms for disclosure. In fact, it's looking like Twitter/X could be getting in trouble soon for removing disclosure labels and hiding paid ads amongst the organic posts.
Disclosure will have to be built in to your own content, and it's going to have to be obvious.
There’s no way to sugarcoat it: some of this disclosure could interfere with the ✨aesthetic✨. Yes, we’re just as heartbroken as you are about it. But it's better than getting busted for lack of clarity.
Disclosure has to be:
Also, as a quick heads up: if the influencer or the influencer’s content is aimed at children (or can be perceived to be aimed at children), the FTC has said they’re going to be even more stringent about disclosure. There are even some arguing that disclosure itself is not enough: the FTC is still deciding on methods.
Video game, toy, and child media content influencers need to be even more vigilant, as do the brands that partner with them.
Brands need to learn the rules to develop their own strategies, of course, because the FTC has shown in the past (and outright stated) that brands can be held liable for the violations of partner influencers.
This is why it's so important for brands to find influencers that align with their message and their values. Scrutinizing their current and past collaborations is important, of course, and a great way to see how flexible they are with the FTC guidelines.
Tools like Klear can also help you find influencers that match your audience and your vibes, but nothing beats first-hand experience.
If you’re looking for help with influencer strategies, FTC guidelines, or just finding the right influencer for your brand, reach out to Inspira Marketing. It’s what we do.