If you are a social media influencer, you must be aware of the Federal Trade Commission (FTC) disclosure provision. This provision requires that any individual paid to promote a product or service must disclose that relationship to their followers. Failure to do so can result in legal action from the FTC. This article will discuss the disclosure provision and how social media influencers can comply with it.
What is the FTC Disclosure Provision?
The FTC Disclosure Provision is a law that requires social media influencers to disclose when they are being paid to promote a product or service. This provision was implemented to help protect consumers from false or misleading advertising. If you are a social media influencer, it is crucial to be aware of this law and to make sure that you disclose any relationships with brands or businesses. Failure to do so could result in severe penalties, including fines.
Why do social media influencers need to take note of it?
There are a few reasons why social media influencers need to take note of the FTC disclosure provision:
-The FTC is serious about this rule and will take action against any influencer who does not comply.
-Failing to disclose a sponsorship or relationship with a brand can be considered deceptive advertising. This is because consumers have a right to know when an advertiser is influencing them.
-Disclosing a sponsorship or relationship helps build trust with consumers.
How social media influencers disclose their relationships with brands
When it comes to sponsored content, social media influencers are required to disclose their relationships with brands. This is done in a few different ways, but the most common is using hashtags such as #ad, #sponsored, or #paid. Some influencers will also include a statement in the post’s caption or video explaining that the content has been sponsored. It’s important to be clear and concise when disclosing sponsored content so that viewers know exactly what they’re looking at.
The FTC’s disclosure provision isn’t just for social media influencers but for anyone who promotes products or services on behalf of a brand. This includes bloggers, YouTubers, and even celebrities. If you’re ever unsure whether you need to disclose a relationship with a brand, err on the side of caution and disclose it.
Not disclosing a sponsored relationship violates the FTC’s guidelines and can result in hefty fines. In 2017, the FTC fined Fashion Nova for not properly disclosing that they were being paid to promote the brand on Instagram. Additionally, on October 3, 2022, Kim Kardashian was fined $1.3 million by the U.S. Securities and Exchange Commission for failing to disclose she was paid $250,000 to publish an Instagram post about EMAX tokens. Even big brands can get in trouble for not following the disclosure rules.
What are the consequences of not disclosing one’s relationship with a brand?
So, what are the consequences of not disclosing one’s relationship with a brand? Well, first of all, you could face a fine from the FTC. Additionally, you could lose credibility with your followers. They may not trust you if they think you’re only promoting a product or service because you’re being paid to do so. As a result, your engagement and reach could decline.
As a social media influencer, it is vital to be aware of the FTC disclosure provision. TalkCounsel is a legal startup that helps brands stay compliant with FTC guidelines for social media endorsements. They can help you create an effective disclosure policy for your brand and ensure that you comply with FTC regulations when working with social media influencers.