As we set out in our previous post, the AANA Code of Ethics is clear that advertising material should be clearly distinguishable as such, and the associated Guidance Note recommends the use of certain hashtags.

Seems simple enough. But influencer marketing is nuanced and the situation in front of you is often more complex than envisaged by the AANA Code. For example, what if an influencer is paid to be a brand ambassador but a particular post is outside of their contractual arrangement? Here, the Australian Influencer Marketing Council (AiMCO) provides some guidance.

The AiMCO is not a regulatory body per se – rather, it is a “diverse collective of industry professionals, marketers and content creators who are committed to elevating influencer marketing best practice, campaign measurement and industry knowledge” whose aim is to “build confidence and trust in influencer marketing”. It does this via its best practice working group, which is made up of professionals across all segments of the influencer marketing industry (including legal). This group has reviewed the detail of the AANA Code and accompanying Practice Note, as well as Ad Standards rulings regarding ad disclosure, and has issued its AiMCO Code of Practice and Gifting Guide, giving those within the influencer marketing industry an easy to distill but detailed summary of how disclosure should be handled.

As well as disclosure, the Code covers other practical issues, like influencer vetting, contract and brief management and even a section which covers the importance of content and IP rights within influencer contracts. Overall, it is a very useful guidebook for marketeers, or equally for in-house counsel who handle influencer engagement and contracts. It focuses not just on the ‘rules’ themselves, but also how internal processes can be put in place to ensure that best practice comes easily.

We summarise some of the key sections of the Code below.

Influencer Vetting

Vetting is something that isn’t specifically discussed in many overseas advertising codes, but it’s an important part of the influencer engagement process, particularly for consumer goods brands operating in highly regulated industries like alcohol. The below are just some of the best practice general vetting actions and these will serve to protect the brand (in particular) if a regulatory issue were to arise:

  • age verification;
  • audience checking and classification;
  • check of prior brand relationships; and
  • review of recent posts.

Age verification and audience checking will be particularly important for alcohol brands (who cannot use influencers under 25) and occasional foods brands (who cannot engage influencers whose audience is more than 25% under 15).

Influencer Contracts

This is another topic that doesn’t often appear in advertising codes, but is a very important part of the influencer engagement process. The Code sets out some key areas that brands and influencers should consider in contracts for paid ads or other content:

  • Intellectual property rights – who owns content produced?
  • Usage – how long can the brand use the influencer’s image and likeness?
  • Content review and changes – what can either side require to be changed once content goes live?
  • Comment moderation – who is responsible for this, if at all?
  • Legal or industry code compliance – an obligation that the influencer complies at all times is key;
  • Remuneration – this seems like an obvious one, but the contract should clearly set out what payment will be made to the influencer and scope. Ambiguity can often creep in to the more complicated collaborations – for example, if collaborative products are going to be produced, clearly state who is paying for their production!

One thing not mentioned by the the Code is an all morals clause – i.e. an obligation for an influencer to conduct themselves at all times with due regard to public morals. Such a clause is designed to curb illegal or immoral behaviour and should be linked to a right for the brand to terminate the contract in the event that an influencer does or says something which would bring it into disrepute. These are particularly important in the age of social media where someone can put their opinions out into the world with a click of a button – if those opinions are controversial, immoral, or simply not shared by the brand, they will want the ability to distance themselves immediately. Without them, brands can be left grasping for another reason to terminate. These clauses become even more important when dealing with a brand ambassador or long-term partner where obligations are ongoing rather than a one-off, e.g. Adidas and Kanye West.

Metrics & Reporting Requirements

This is often forgotten by lawyers because it’s not something they’ll ever see – but it’s important for marketing teams to know what their ROI was from an influencer collaboration, e.g. engagement, reach, impressions, ‘cost per’ metrics and associated demographic information. Whether a brand engages a particular influencer again will likely rest on this information, so in our opinion, it should be in every influencer agreement template!

Disclosure

One thing the AiMCO Code does which the AANA Code does not, is to explain why disclosure is so important. In Australia, it’s because of the Australian Consumer Law which contains two fundamental rules relating to advertising:

  1. You must not engage in conduct which is likely to mislead or deceive; and
  2. You must not make false or misleading claims or statements.

Failing to disclose a paid influencer engagement potentially breaches these fundamental rules. In other words, a paid post which appears to be organic because it isn’t disclosed is potentially misleading under the ACL.

Any of the following require disclosure:

  • Any transaction with financial payment;
  • Value in-kind;
  • Gifts and/or free products; and
  • Affiliate marketing.

Whilst AiMCO states that #ad or #sponsored are the two preferred disclosure tags, it also makes clear that a # may not be required where a platform gives the ability to embed a “paid post” or “sponsored post” within a post. Where the former are used, the disclosure must be clear, and not hidden in any way – it should be easy for the consumer to see and engage with the disclosure which likely requires that it appear at the beginning of a caption rather than hidden in other #’s.

The Code also gives further guidance regarding videos, which require superimposed text on-screen at the beginning of the video and in the caption.

Where disclosure is not required is also clear:

  • There is no contracted engagement; or
  • There is no input or control over the influencer content or outcome.

Gifting

Gifting to influencers is something we’re asked about regularly by clients, and we often hear “we can see other brands gifting product without disclosing, so why can’t we?”

When it comes to disclosure for gifts, the Code seems to differentiate between high value gifts and low value gifts, although the relevant section is contradictory. 2.4 states that:

Gifts or value-in-kind are considered equivalent to payment in advertising engagements. This means that disclosure is required”.

However, the same clauses later state that “where a high value gift has been provided, it is considered required that advertising disclosure be made.”

So, when does a gift need to be disclosed? In response to the confusion, the AiMCO has now released a specific influencer Guide to Gifting. Helpfully, the guide lists a range of scenarios in which a gift will need to be disclosed as an ad. In short, any gift by a brand to an influencer is likely to require disclosure on the basis that the brand has sought out the influencer, or otherwise invited them to an event and created a gift bag, hoping that they would post.

The only circumstances in which a gift is not an ad is if the gift is given by someone completely unrelated to the brand and the influencer has never had any commercial relationship with the brand, but the influencer decides to post about it anyway (because they loved the product so much).

This second requirement – not to have any commercial relationship with the brand - is important. We’ll look at it more closely along with related Ad Standards decisions in the next blog post.