Your Guide to Influencer Contracts and How to Use Them

0

Your Guide to Influencer Contracts and How to Use Them

There is no hiding the fact that social media influencers and content creators are here to stay. This exciting form of marketing has grown exponentially in recent years from being a billion-dollar market in 2017 to now a $13 billion industry! “Influencing” and content creation is no longer just about driving sales or building brand awareness; it's become a lucrative business for many. 

influencer market sizeIf you currently have or are thinking about starting a content creation business, you know that it’s not always as rosy as it looks. Working with various brands can be challenging and it becomes important to protect your income. That’s precisely where influencer contracts come into play. The legalities of the influencer world aren’t discussed much, but they are just as vital to this business as any other. 

In this ultimate contract guide, we’ll go over all the components of creating robust and solid business contracts that’ll protect your income and set you up for long-term success. We even provide a few influencer contract templates you can use. 

Got Multiple Revenue Streams, Sponsorship Deals, and Brand Collaborations? Download Our Free Influencer Income & Expense Tracker.

6 Common Influencer Contracts

A contract is a legally binding document between an influencer or content creator and a brand that they wish to work with. There can be multiple types of contracts that you, as a budding influencer, can implement.

These contracts cover important information about project deliverables, payment schedules and duration and also make sure the campaign meets the Federal Trade Commission (FTC) regulations, which is the governing body that protects consumers from deceptive advertising and unfair business practices.

why influencer contracts are neededBelow, we present some of the most applicable contracts for your influencer or content creation business.

1. Independent Contractor Agreement or Influencer Contract 

As an influencer or TikToker, you are considered an independent contractor who is providing service to brands or clients. That service could be promoting products or creating content to increase followers. An independent contractor agreement is often known as an influencer contractor or influencer marketing agreement. This sort of contract will cover the scope of the project, compensation, duration and other standard clauses.

What to Include in an Influencer Contract 

Influencing and being a social media content creator is a new and continuously evolving medium. So, it’s completely okay to be confused about what exactly an influencer contract should include and what you should negotiate for in a collaboration. Luckily, you are at the right place.

Below, we highlight the must-have components of an influencer contract — one that will ensure your influencer and content creation business is protected from any mismanagement and unforeseen circumstances. 

Scope and Specifics of Content

Just agreeing to “create content” without any details is akin to opening a can of worms. A solid influencer contract will have the specifics regarding the type of content required: 

  • Type of Content and Medium: What format of content will you deliver? Static posts? Videos? Stories? Which social media channels will you have to share the content on? 
  • Quantity: How many pieces of content will be shared? Will it be one post and two stories per week? If the content is to be shared across multiple social media handles, include specifics on which posts will be shared on which channel. 
  • Timing: In addition to having details specific to the duration of the collaboration (one month/three months), it would be beneficial to also include when the content will be shared (mornings or evenings, specific days). This will help both parties tie the campaign performance to actual data. 
  • Captions and Aesthetics: If there are any particular hashtags, aesthetics, tone or language guidelines that the brands want to have linked with every piece of content, include those phrases and guidelines in the agreement. 
  • Engagement: Decide who will manage the engagement of the posts. This means who will reply to the comments or answer any product-related FAQs. Today, any piece of content is subjected to trolling and going viral for the wrong reasons and this can tarnish the brand or your reputation. Therefore it's best to know beforehand who (the brand or you) will manage this.

Collaboration Deliverables 

Clear deliverables are a must for any project to be successful — they can make or break a campaign. What is it that you are promising to the brand and how will it be measured? Some common influencer marketing objectives are: 

  • Driving website traffic 
  • Promoting a new product or discount
  • Increasing brand awareness

Approval Process 

Many times brands want to maintain a certain aesthetic for their posts and might require you to submit content beforehand for approval. Get in writing as to what the mutually defined approval process is and the pertaining timeline for it. Having this in writing beforehand will make the content creation process simpler and help you avoid unnecessary re-shoots/rework. Consider the following scenarios:

  • How much in advance does content have to be sent for approval? Four days before the date of posting or a week prior?  
  • How many times will you tweak content after feedback? Is it a one-stage process or two steps? 
  • How does the content have to be submitted for review? A Google Doc with image and caption? Or just a video?

Who Owns the Content

Influencer posts are great material for repurposing content, and brands recognize this. But would you like to have your material be used repeatedly without your consent or some sort of remuneration? That’s why it’s important to identify who owns the content and whether the content created for a campaign can be reused. 

Include in your contract whether any content you made can be reused and for how long. Can a brand use your content on their website, social media handles, newsletters or any other marketing material? If yes, for how long? For the duration of your collaboration or for a time frame after that? 

Type and Frequency of Compensation

Compensation for influencers and content creators can be varied and it isn’t always monetary. A lot of times brands will provide products worth $X for free to a content creator in exchange for a few blogs or stories. Whatever the case may be, ensure your influencer contracts contains:

  • Payment Form: Will the payment be done via a direct bank transfer or check? If the payment is not monetary, include details about what type, number and value of products will be given. 
  • Currency: If you are an international influencer or working with a brand that is based in a different country, specify in which currency (euros, dollars or pounds) the payment will be made. 
  • Frequency of Payment: When will the compensation be given? Will a certain percentage be paid upfront or will the payment come as a lump sum at the end of the campaign? Be sure to include a clause for any situation when a payment can be revoked or canceled. 

FTC Disclosure Guidelines 

The FTC works to ensure that the general consumer is not misled and misguided, especially in scenarios where you as an influencer have paid (monetarily or otherwise) to promote a brand. They also specifically state that it’s your responsibility to make these disclosures in their latest social media influencer guideline

In order to avoid any snafu with the FTC that could result in penalties, fines and other legal fees, your contract should mention how the partnership with the brand will be disclosed. The text should not be ambiguous like “working in collaboration with Brand Y.” 

As a content creator, you can mention in your contract that you will abide by FTC guidelines by doing one of the following:

  • Using Instagram’s “Paid Partnership” feature
  • Having explicit statements like “this product was given to me by brand X” or “post sponsored by brand Z” 
  • Including hashtags like #ad #paidsponsorship #paidpartnership or #sponsored
  • If you’re creating a form of video content, mention the sponsorship at the beginning of it

Doing this will not only show brands that you take federal regulations seriously, but it will also protect your brand image. 

2. Non-Disclosure and Confidentiality Agreements

Confidentiality and non-disclosure agreements protect your proprietary business information. In the influencer business, there are many assets to protect — it could be your account, identity, financial figures, information about upcoming product releases, specific marketing strategies, your list of followers, etc. 

Sometimes a brand might ask you to hand over your social media login information or they might share their login details so you can do an “Instagram takeover.” This is certainly exciting, but it also can put your personal information at risk. Having non-disclosure and confidentiality agreements in place will protect your digital privacy and prevent all this sensitive information from being shared or stolen. 

Key provisions included in confidentiality agreements are:

  • Names, Duration and Type of Business: Include the complete names of the people signing the document. It’s also necessary to mention the dates the agreement will be active. Non-disclosure of proprietary information agreements typically last 5-7 years. Also include the type of business the parties in the agreement are in — services, manufacturing, advertising, etc. 
  • Reason for agreement: Specify what information needs to be kept protected. If this aspect is left vague, it won’t hold up in court. What is it that you don’t want to be shared — login information, influencer statistics or client lists. 

Society of Human Resource Management is a great resource to look up sample confidentiality contracts. 

non-disclosure agreement template

Source

3. Exclusivity Agreements

An exclusivity agreement determines whether you can enter into a partnership with another brand (often a competitor) during a campaign period. If a brand does require exclusivity, ask them to explicitly state which brands you are not allowed to work with and for how long. This eliminates any confusion or uncertainty when it comes to any other brand partnerships you might seek to take on.

A sample exclusivity clause excerpt is provided below:

“Influencer agrees that during the tenure of this contract, and for a three-month term afterward, Influencer will not undertake influencer marketing for a competitor in the same vertical as Company.”

4. Vendor Contracts

Giveaways of products or services are quite popular in the world of content creation. Brands might reach out to you by giving you free products in exchange for publicity or ask you to run a contest on their behalf. In such cases, having a vendor contract will be beneficial as it will outline the exact scope of the contest and how the product will exchange hands or be delivered to the winners. If a brand provides you with a vendor contract, here’s how you can read them

5. Indemnification Contracts

“To indemnify” means to compensate someone for their harm or loss. How does it apply to your influencer business? Consider this example: You promote a skincare product as part of a collaboration, and one of your followers gets a bad rash from it and decides to sue the brand. The indemnification clause will hold the answer to who will be responsible for this liability. 

Indemnification can be addressed via a separate contract or as a clause in a general influencer contract. They are vital to protect one or both parties from liability if a third party or third entity is harmed. It’s also good to know that indemnification is focused on providing financial protection against potential lawsuits and is often addressed as a part of a business’s terms and conditions

6. Letter of Intent

The world of advertising, content creation and influencing is definitely fast-paced and on to go. Sometimes, you might encounter a brand that wants to announce a collaboration quickly and then work out the details of the partnership. In such cases, a letter of intent would be beneficial.

A letter of intent outlines the preliminary commitment of one party to do business with another. Think of it as a first step towards forming a formal contract that will do the following:

  • Clarify which key points of a deal must be negotiated.
  • Protect all parties involved in the deal.
  • Announce the nature of the deal, such as a brand collaboration or partnership.

How Do Influencer Contracts Work? 

Starting a content creation or influencer business is a personal form of engagement where there are already a lot of variables. Influencer contracts and agreements remove any ambiguity or vagueness around expectations between a brand and you. Contracts ensure that both parties hold their side of the bargain (nobody likes scams here) and protect you from unwanted trouble like lawsuits, delayed payment or unmet deliverables. Finally, having a written and signed contract before starting a campaign establishes a sense of respect and shows you’re serious about this collab. 

Influencer contracts work best when they are implemented at the beginning of an association between a new brand and yourself. Over time, the document can be altered to accommodate any changes in the working relationship. 

Where to Find Influencer Contracts

Now you know all the essential components of an influencer contract, but it can still be tricky to put one together. The good news is that there are a variety of places you can get your hands on influencer contract templates. 

Incfile’s Business Contract Library is one place you can find over 25 legal document templates that cover some of the most common business scenarios. These legal documents have been prepared by attorneys and are available if you opt to incorporate your business with us. 

It's also worth checking out this social media influencer template or influencer contractor toolkit if you want to build one for yourself. 

You also have the option of working directly with an attorney who can draft a contract on your behalf based on your specific scenario. This last option does come with a pricey tag. 

Are Influencer Contracts Necessary? 

While you can certainly do business in “good faith,” having a signed influencer contract prevents your business from falling prey to poor campaign results, FTC backlash and any unnecessary controversy. It may seem like a whole lot of work, but having all the terms and conditions of your collaboration sealed in writing is one of the best ways to protect your brand and prevent costly misunderstandings.

A flourishing influencer business requires you to manage a lot — clients, contracts, compliance paperwork and your income and expenses. All this can be difficult for any entrepreneur. Incfile’s Influencer Income and Expense tracker can help you keep tabs on your income.

Got Multiple Revenue Streams, Sponsorship Deals, and Brand Collaborations? Download Our Free Influencer Income & Expense Tracker.

0
Paper List

Like What You're Reading?

Get fresh monthly tips to start & grow your LLC.

Related Articles

  • 11 Out-of-the-Box Side Hustles for Women to Make an Extra $1,000 a Month
  • A Giant List of Self-Employment Business Ideas
  • How to Pay Yourself as an LLC Owner
  • 15 Items You Can Easily Flip for $100-$5,000 in Profit a Month
  • If You're Not a U.S. Citizen, Can You Get an EIN for Your Business?
  • How to Create and File an LLC for Free
  • So You Moved? Follow This Guide to Moving Your LLC to Another State
  • 70% of Gen Z Are Looking to Start a Side Hustle in 2022. Here Are the 10 Most Popular Ideas.
  • 15 U.S. States with the Lowest State Fee to Start a Business Today
  • Understanding DBAs and How They May Be Beneficial to Your Small Business
  • Need a Physical Address for Your Business?
  • Are Non-U.S. Residents Allowed to Own a Corporation or LLC?
  • 7 Small Business Ideas That Take Under $500 to Start
  • ​Do LLCs Get a 1099 During Tax Time?
  • How to Search and Choose Your Business Name in All 50 States
  • Series LLC vs. LLC: Which One Do You Need?
  • 15 High-Demand Businesses You Can Start Today in Florida [+5 Home-Based Business Ideas]
  • ​Understanding When to Use LLC for Your Business
  • PLLC vs. LLC: What You Need to Know
  • LLC vs. S Corp: Which Is Right for Your Business?