In the era of social media, influencer marketing has become a powerful tool for lifestyle brands. Whether it's a skincare line showcased in a morning routine video or a protein bar featured in a gym selfie, influencers can create authentic connections with audiences that traditional advertising often can't. But as influencer partnerships grow, so does the scrutiny—especially from regulators like the Federal Trade Commission (FTC).
If your brand works with influencers, here’s one rule you can’t afford to ignore: Proper disclosure is non-negotiable. Failure to follow the rules can not only damage your reputation—it can cost your business big time.
Lessons from Teami
In 2020, the FTC cracked down on Teami, a wellness brand, for deceptive influencer marketing practices. Despite being paid to promote Teami products, many influencers failed to clearly disclose their partnerships. The result? A $15.2 million judgment and a public warning to all brands and influencers: Transparency is mandatory.
The FTC’s Stance: Clarity Is Key (Not Just a Hashtag)
The FTC requires that any material connection between an influencer and a brand—be it payment, free products, or other perks—must be clearly and conspicuously disclosed. And no, dropping a lone "#sponsored" at the end of a post doesn’t always cut it.
Debunking the “Sponsored” Myth
While hashtags like #sponsored or #ad are common, their effectiveness depends on how and where they’re used. The FTC considers context, visibility, and language comprehension. If consumers can’t easily spot or understand the disclosure, it’s not good enough.
Here’s what that means in practice:
Placement Matters
Disclosures should be unmissable. The FTC suggests placing them:
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Near the endorsement, not buried in hashtags or caption clutter
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Above the fold—meaning viewers shouldn’t have to click “more” or scroll to find it
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In a font size, color, and style that makes it easy to read
Language Matters
Not all terms are created equal. Use clear, straightforward language that the average person would understand. Good examples include:
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“#Ad” or “#Advertisement”
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“Paid partnership with [Brand]”
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“[Brand] sent me this product to try”
Avoid vague phrases like #partner, #gifted, or #collab—they might leave your audience guessing, and that’s exactly what the FTC wants to avoid.
Medium Matters
How you disclose also depends on where the content appears:
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Photos/Videos: Use on-screen text that’s easy to read and appears for long enough to notice. In videos, verbal disclosures are recommended.
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Live Streams: Verbal disclosures should happen periodically. Visual ones help too.
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Podcasts: Start with a verbal disclosure, and consider repeating it during sponsored segments.
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Stories/Reels: Disclosures need to be on-screen and visible throughout the content—not disappearing in a flash.
The goal: Your audience should always know when content is sponsored so they can evaluate it appropriately.
Who Bears the Responsibility? (Hint: It’s Both of You)
For Brands:
You can’t just hand off a product, pay an influencer, and hope for the best. Brands must:
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Educate influencers on disclosure requirements
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Include clear disclosure clauses in all influencer contracts
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Monitor influencer content to ensure compliance
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Understand that even if the influencer messes up, you might be held accountable
For Influencers:
Even without brand direction, influencers are still expected to:
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Understand and follow FTC rules
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Make disclosures that are clear and easy to understand
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Be honest—disclosure doesn’t excuse misleading claims
Bottom line? Transparency is a shared responsibility.
Key Takeaways and Best Practices for Brands
Want to stay on the right side of the FTC and build trust with your audience? Here’s how:
✅ Create a Clear Disclosure Policy: Set specific expectations for how influencers should disclose.
✅ Put It in the Contract: Make disclosure a formal part of your influencer agreements.
✅ Provide Examples and Training: Give influencers real-world examples and offer platform-specific guidance.
✅ Monitor Compliance: Keep tabs on how your influencers are disclosing—and follow up when something seems off.
✅ Keep the Conversation Open: Build a culture of communication and transparency in your partnerships.
Final Thoughts
Influencer marketing works best when it’s rooted in authenticity and trust. Proper disclosure isn’t just a legal checkbox—it’s a way to respect your audience and build long-term brand loyalty. So, is “#sponsored” enough? Sometimes. But not always.
When in doubt, be clear, be honest, and be seen.
Need help creating a disclosure policy or training resources for your influencer program? Let’s talk. 👇
