If your business plans on sponsoring a sportsperson or using a social media influencer to help sell your products or services, or to raise brand awareness, then you need to know the best way to protect your business.
There’s a common scenario that a famous sportsperson, influencer or celebrity hits the news headlines for the wrong reasons and the brands they are associated with try to quietly pull the plug on activities, but not after they have faced some bad publicity. This type of marketing activity comes with risks.
There are increasingly many opportunities for small businesses to get involved with up-and-coming sportspeople and micro-influencers. No matter how small the amount of support you are providing, it’s important to have a contract in place to protect your business reputation. The saying that a brand takes years to build but seconds to destroy is worth remembering.
The key starting point with this type of contract is that it sets out the terms specifically and clearly, which details:
What the person is being asked to do
It needs to be clear if they are promoting the business as a whole or individual products or services. Will they be seen using them or will they simply talk about them? If they are using them then are they using them alone or alongside other products? Which social media platforms will they use to promote the business; will it appear on only one or multiple channels? If they host a podcast, will you want it to be mentioned on that as well as their Instagram feed?
If they are being asked to appear at an event, the contract needs to be clear about how much time will be spent there, what they will be expected to do whilst there and who they will meet, if photographs or filming is allowed, if they will be required to speak publicly. If it is an item of clothing, will they be expected to wear it for the whole time they are at the event and what will they wear it with?
How long it will last
If you are asking them to advocate for your brand or your brand values, then this tends to be a longer-term commitment, and it is advisable to spend time vetting potential partners before an agreement is reached. This type of longer-term partnership will help to build a connection with your audience, and the influencer will provide their audience with an insight into their own experiences, but the longer the arrangement the greater chance of something happening which you disagree with.
If it is a shorter relationship, maybe for one social media post or if you are supplying them with your goods or services for them to provide a review for their audience, offering their audience a discount or providing products for them to give away as competition prizes, then your agreement can reflect this.
All contracts need to have a start and end point and clear terms which allow both parties to give notice.
How they will do it
Will they be asked to sample a product and talk about it, use it and show the results, will it appear in the background to their filming or photographs, or will it be a piece of furniture prominently on display? Will they be asked to mention it in a press interview or make themselves available for interviews as part of the role?
Because there are so many different permutations of what you might want to ask someone to do then you need to give very specific thought to it. All of this needs to be done within the Advertising Standards Authority guidance for influencers which has to state if it is a paid partnership or advert.
How they will get paid and when
Will the person be paid in one lump sum or staged payments and will the payments be linked to meeting certain goals? Will there be any form of bonus payment if, for example, sales exceed expectations? Can you withhold any of the payment if the full terms of the contract are not met and are there any circumstances where the individual could ask for more money? It is never advisable to agree to terms which require you to pay in advance in case you are not happy with the results.
How the agreement can and will be terminated
This is probably one of the most important areas as you need to be able to halt activity swiftly and without repercussions if the individual does something which could bring your business into disrepute. For example, if they are arrested, are seen taking drugs, are rude or abusive or express social and political views which don’t align with your brand values.
An important part of deciding who to work with is to have a thorough vetting process to help avoid issues arising.
You should be specific about what the red lines are. For example, if they were asked to promote a vegan product but are then seen eating a steak. If they are being asked to promote a no-alcohol product but are then seen drinking heavily. They may push back and try to resist but you have to think about the damage which could happen to your brand.
For many celebrities and influencers, this is a key part of their livelihood, and they will also want to get it right. For greater success, be open about your concerns, especially if this is the first time your business has entered into this type of agreement, address them all with a well-worded contract and make sure you both follow the terms set out.
Peter Kouwenberg is a partner at Taylor Walton Solicitors.
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