October 01, 2018 Landslide

Influencers: What Every Brand and Legal Counsel Should Know

Mark Goodrich and Jason Howell

The growth of social media and “influencers” represents a sea change in how brands, celebrities, spokespersons, and consumers interact. An “influencer” is any person with credibility who can influence the opinions or purchase decisions of others. For example, influencers are often social media stars, gamers, bloggers, brand ambassadors, and celebrities. While brands previously relied primarily on traditional advertising such as print, television, radio, and even their websites to disseminate carefully structured messages to consumers, influencers now allow brands to engage with millions of consumers more organically than before. In fact, a 2017 study found that 86 percent of marketers surveyed now use influencer marketing, and 92 percent of those marketers found it effective.1 And a 2018 study estimates that of brands currently using influencer marketing, 43 percent intend to increase influencer marketing budgets in the next 12 months.2 However, influencer campaigns create a number of legal challenges to navigate, and in particular make it difficult for consumers to discern whether the influencer simply likes a product or is being paid to promote the product or brand. As a result, the Federal Trade Commission (FTC) has made “endorsement” compliance a point of emphasis in recent years, issuing a policy statement, periodic guidance, and enforcements to encourage clear and truthful influencer advertising, and to ensure that consumers are aware of material connections between influencers and brands.

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