The Ultimate Guide to Avoiding FTC Penalties for Influencers

Are you a content creator? Are you passionate about sharing your best tips, brightest ideas, and favorite products with your audience? 

Whether it’s step-by-step guides for traveling the world, tips for living a healthier lifestyle, or sharing delicious and inspiring new recipes- if you’re working with brands, you’ll need to know how to navigate these guidelines, or you might find yourself facing penalties!  

The FTC Guidelines can be confusing – there’s a ton of information and conflicting opinions regarding adequate disclosures, and let’s face it, it can be tempting to nix the disclosure altogether! After all, doesn’t everyone skip ads and scroll past sponsored content anyway?

Even though it might seem like no one is facing the consequences of skipping disclosures, the FTC is only cracking down on it more. The FTC has previously sent more than 90 letters to influencers regarding their lack of disclosures and follow-up letters to 21 influencers who didn’t edit their posts. 

To put how serious this is into perspective, even the Kardashians are complying! 

Kim Kardashian recently had to pay a $1 million settlement for failing to adequately disclose her compensation for a post promoting a crypto asset. 

Many other influencers are under fire, including Cardi B and Adrienne Bailon, for their involvement with Teami, a tea company. The brand eventually paid a $15.2 million settlement.

Do ads actually make your audience check out? While many creators fear letting their audience know they are paid for posts or that content is sponsored, it’s more critical to maintain authenticity and transparency with your audience. 

After all, creating content is your job- you deserve to be paid for your work just like everyone else. The majority of your audience doesn’t mind the sponsorships! Don’t believe it? In a recent poll, 40% of US adults said they enjoy seeing social media ads. 

Disclosures don’t have to be stuffy or boring! In fact, disclosing your relationship with brands can make you look more professional and open the door to working with other brands.

Now that we’re on the same page that disclosing is what all the cool kids are doing – here’s the step-by-step for how to start doing it!

The good news is that the FTC is pretty flexible regarding disclosures! You don’t have to use a specific disclosure- as long as the disclosure is clear, close to the endorsement, and conspicuous, you’re covered. 

Clear – your disclosure needs to show a financial relationship clearly. #ad or  #sponsored are great options. Disclosures that are vague, such as #ambassador, should be avoided, but something more explicit, such as #McDonaldsAmbassador, is probably fine. Don’t use ambiguous disclosures, like #spon or #aff. Your audience should understand that you’re getting compensated. Don’t create the impression that you were compensated for less than what you actually got paid.

Close – Your disclosure needs to be near the endorsement. Don’t hide your disclosure below a “see more” fold or at the bottom of a long page. If you’re mentioning the product verbally, your disclosure should immediately precede the mention of the brand – don’t just say sponsored at the beginning of the video if you don’t introduce the product till 10 minutes into your video.

Conspicuous – Don’t hide your disclosure in a bunch of hashtags – if you’re using #ad as your disclosure, make sure it’s easy to spot. Don’t rely on platform-specific disclosure features like YouTube or Instagram’s Paid Promotion box.

And that’s the basics of ensuring you won’t get sued by the FTC! Still have questions on how you can put your disclosures into action? We’d love to help! Reach out to us at compliance@influencelogic.com.