What the FTC Has to Say About Your Brand’s Influencer Marketing

July 31, 2017 | blog | By Mike Sullivan

Above: Top YouTuber, Ingrid Nilsen 

Social media influencers are giving celebrities a run for their money when it comes to product and brand-endorsement deals. Whether it’s a local foodie Instagramming their meal or a mommy blogger trying out a new product, digital content has become heavily trafficked by these influencers.

For a few hundred dollars, your challenger brand can be promoted to thousands of people within a subculture or hyper-targeted campaign. Influencers can be highly credible to their audiences. See the numbers.

Because there is an exchange of cash, free products, or other incentives for the feature or endorsement, the Federal Trade Commission (FTC) has stepped in to keep things on the up and up.

Take notice, because they are enforcing these laws and advertisers can’t bank on the influencer alone to understand and comply. It’s your challenger brand on the hook, after all. If you’re launching an influencer campaign you need a working knowledge of the rules. Don’t worry! They’re actually pretty simple once the objectives are understood.

The FTC has created a set of endorsement rules and regulations for social media and compiled these rules into a thick handbook about disclosure for brands and their influencers. You can leave that document for the lawyers; we’ve trimmed down the jargon to offer you a simplified version of their guidelines.

Does this apply to me?

  • These guidelines apply to any company or brand that is exchanging compensation or free products for a content feature, mention or review.
  • Don’t be alarmed if an influencer mentions your brand or product. If you didn’t compensate them there is nothing to disclose.

How do I do it?

  • Although there is no precise formula to follow when disclosing a brand relationship, there is one golden rule you can follow: Always Be Transparent.
  • No matter how your influencers choose to say it, they should be upfront with followers and viewers that they received some form of freebie or compensation in exchange for the content.
  • Your influencer’s disclosure should use unambiguous language and be clearly visible. A tiny, “#Ad” at the bottom of a YouTube video isn’t going to cut it, according to the FTC.
  • However, #ad could be enough for Twitter and Instagram given the shorter text space.
    • Example 1: [challenger brand] gave me [this free product] to try. #ad
    • Example 2: I was paid by [challenger brand] to review [this product]. #ad
    • Example 3: Thanks to [challenger brand] for sponsoring this post. #ad

Why does this matter?

  • Your challenger brand could get a legal hit from the FTC.
  • Plus, it’s just the right thing to do for ethical advertising.

The Bottom Line
Insist that influencers are straightforward with a disclosure statement as part of your agreement. It’s the right thing to do for their followers, your customers, and most importantly, it’s the law.

Want to read more? See the FTC’s helpful Q&A.

For more information on challenger brands check out some of our recent blog posts: 

Your Challenger Brand Doesn’t Need a Celebrity 

Digital Targeting Six Ways

influencer marketingInfluencerssocial media

Mike Sullivan

President at LOOMIS, the country’s leading challenger brand advertising agency


We challenge underdog brands to think differently. We help them find their voice, and urge them to blaze new trails to make sure they stand out from the pack. Whether you need an agency of record or support on a project, we are here to help you win.