Did you know that word-of-mouth generates $6 trillion in annual global spending? It’s an incredible figure and an indication as to why influencer marketing has become such a successful brand strategy.
Whether you sell skincare products, have a clothing label, or you’re dropshipping quirky gifts for fly-fishing enthusiasts, you can see a lot of success with influencer marketing as an ecommerce brand – especially as new privacy rules cause Facebook ads to decline in profitability.
Influencer marketing not only drives brand awareness, but also helps companies engage with prospective customers on a deeper level, drive high-intent traffic, and generate sales. But aside from attribution and tracking to inform the success of your influencer marketing campaign, there’s another challenge at hand: contracts.
In this article, we’re doing a deep dive on what an influencer contract is, what to include in the agreement, and a template that you can use for your next campaign.
An influencer contract is a legal document that covers all the necessary terms and agreements between the influencer and your brand.
Your influencer contract will include essential information that both parties need to agree on, such as the dates of the campaign, how the influencer needs to share brand information on social media, and any hashtags they should use.
It’s a good idea to keep track of Federal Trade Commission (FTC) requirements when agreeing on contract terms, which regulate influencer marketing procedures in terms of advertising. These rules can vary and change over time, and depending on the country where the campaign is being launched, the influencer might need to follow different steps. As an example, influencers need to disclose if they are being paid to promote your business by tagging it as a ‘paid partnership’ or including ‘ad’ or ‘sponsored’ in the caption.
No matter the size of the or how established your brand may be, there should be an agreement signed by both parties. Having a verbal agreement over email means there could be misinterpretations on both sides, which is what you want to avoid.
Here are the necessary elements that you should include in your next influencer contract – orr you can use the template we’ve created below!
This is one of the main components of every contract. As a brand, you need to set up the objectives and the type of campaign content that you want to see on social media.
Although you want to make expectations clear, you don’t need to be overly prescriptive; influencers have their own unique style of content creation that needs to shine through in order for their audience to appreciate and connect with it. You can always tell when a brand has been overly prescriptive with their campaign on an influencer partnership.
In this section you should include:
The type of content refers to the number of photos, reels, or stories that you are paying for. It’s important to choose a format that fits naturally within the influencer’s current content, but also suits the nature of your brand’s campaign.
As well as the type of content, you need to determine how many pieces of content will be shared.
When is the best time to share this content? Usually, influencers have internal insights that show when engagement is at its peak. On Instagram, for example, business accounts can see what times of the day their followers are most active.
If you aren’t sure, ask the influencer about previous campaigns and the timing for content sharing.
You want to ensure that your brand’s values are projected authentically to the world, so make sure the influencer’s content follows a similar aesthetic to your own in case you want to reshare it. This applies to filters, styling, and color schemes.
As part of the communication process with the influencer, you need to address the objectives you plan to reach by the end of the campaign. In an influencer marketing campaign, the most common objectives for a brand are:
You may have an affiliate program in place that can incentivize and pay influencers for their post performance. This can be directly tied to sales or sign-ups and mentioned at this point of the contract.
This section provides a detailed explanation of the services to be rendered by the influencer. It describes the nature of the content they will create, the platforms they will utilize, and any specific tasks or promotional activities they will undertake. It establishes the scope and outlines the influencer's responsibilities, setting clear expectations for the services to be provided.
In this section, the specific deliverables expected from the influencer are outlined. It may include the quantity of posts, videos, or other content pieces to be produced, as well as any additional requirements such as brand mentions or product placements. Defining the deliverables helps both parties understand the final outputs that are anticipated.
This section establishes a timeline for the influencer marketing campaign, including significant milestones or deadlines for content creation, posting, and other promotional efforts. It ensures that both parties are in agreement regarding the timeline, allowing for effective project management and coordination.
Here, the performance metrics and key performance indicators (KPIs) are identified. These metrics could include engagement rates, reach, conversion rates, or any other relevant measurements used to assess the success of the influencer campaign. Establishing clear performance metrics allows for an objective evaluation of the influencer's performance and facilitates the tracking of campaign effectiveness.
The compensation structure needs to be articulated clearly and agreed upon in black and white.
Will you be offering monetary compensation, sending products, or both?
No matter how the influencer will be compensated, a brand should take into account:
This part of the contract outlines when you will be paying or sending products to the influencer as compensation. If they are reviewing your product or service as part of the content agreement, then you will need to outline the timeline for when you expect the post to go live.
You might offer to pay 50% upfront and 50% once the content is posted. If you are doing performance-related affiliate payments, let the influencer know when they can expect their first payment and ongoing payments thereafter.
If the influencer is based in another country, it’s important to outline which currency will be used to pay them. Remember that many countries have “dollars” as a currency, so specify if it’s USD, AUD, CAD, etc.
As a brand, it can be difficult to know how much an influencer should get paid. You can either ask the influencer for their media kit (where this information is usually available) or use an influencer marketing platform to analyze this metric beforehand. That way, brands can have an idea of how much budget should be allocated to the campaign.
This section outlines the agreed-upon fee structure for the influencer's services. It specifies whether the influencer will receive a fixed fee, a commission-based payment, or a combination thereof. Defining the fee structure clearly helps avoid any misunderstandings regarding compensation.
In this section, the payment schedule agreed upon between the parties is detailed. It specifies when and how the influencer will receive compensation, whether it is a one-time payment, monthly installments, or based on specific project milestones. The payment schedule ensures transparency and clarity regarding the timing and frequency of payments.
This section addresses any additional expenses that may be incurred during the influencer marketing campaign. It may include costs such as travel expenses, production costs, or any other expenses that go beyond the influencer's regular services. The agreement should clearly stipulate who will bear these additional expenses and the reimbursement process.
Here, the consequences of late payments are outlined. It may specify penalties or interest charges that will be applied in case of late payments, as well as the procedures for resolving payment discrepancies. This ensures that both parties understand the expectations regarding timely payments and helps maintain a mutually beneficial working relationship.
This section addresses the ownership and usage rights of the content created by the influencer. It clarifies whether the influencer retains ownership of their content or transfers ownership to the client. It also outlines the extent to which the client can use, modify, or distribute the influencer's content.
In this section, the process for content creation and approval is described. It may include requirements for content submission, review, and revision processes to ensure that the content aligns with the client's brand and guidelines. This section helps establish a collaborative workflow between the influencer and the client.
This section addresses exclusivity and potential conflicts of interest that may arise during the collaboration. It may include clauses specifying whether the influencer is prohibited from promoting competing brands or products during the contract period. This ensures that the influencer's activities do not undermine the client's interests.
In compliance with relevant advertising regulations and guidelines, this section outlines the requirement for the influencer to disclose their partnership with the client when promoting the client's products or services. It emphasizes the importance of transparency and compliance with legal and ethical standards.
In the US, the FTC has released several requirements that influencers need to follow when they publish sponsored content. However, these guidelines differ by country: for example, you may need to consider GDPR guidelines in Europe and the UK as well.
As of 2021, FTC guidelines state that paid endorsements need to be clearly declared by the influencer. This means that the influencer needs to include #ad or #sponsored in the caption of the content.
If you have a legal team, make sure the contract is reviewed by them. Once the contract is completed and verified, send it through a secure channel that you were using to communicate with influencers.
Now that the contract has been received, negotiations between both parties can start. Be open to communicating with the influencer, as some points in the agreement can change. Sometimes, influencers might be working with other brands already and the start date might be delayed.
To get you started, we have created an Influencer Marketing Contract Template that you can customize for your brand and send for signature using Signeasy! Get your free trial today and start collecting eSignatures within minutes!