Engaging an agency or influencer: What should the contract say?

1. What is the difference between traditional marketing services and influencer marketing services?

At a high level, agencies usually design, produce and place advertising across established media, while influencers promote a brand, product or service through their online audience.

Agencies tend to control the creative process and media placement. Influencers, by contrast, act as their own media channel and will often mix in their own brand, audience and style.

That difference can affect how your business should control compliance and aim to protect its reputation. Influencers may be engaged directly or through an agency, so businesses should be clear about who is responsible for content, approvals, and meeting requirements.

2. Regulatory obligations

UK law and self-regulation have shifted significantly, particularly under the Digital Markets, Competition and Consumers Act 2024 (“DMCCA 2024”). Both brands and influencers are now subject to enhanced transparency and consumer protection duties, enforced by the Competition and Markets Authority (“CMA”) and the Advertising Standards Authority (“ASA”). This framework applies whether a campaign falls under traditional advertising or is influencer related.

Before discussing some suggestions as to contracts, it is worth keeping the current requirements in mind. Under the DMCCA 2024, unfair commercial practices such as hidden sponsorship, fake reviews, and misleading pricing can attract serious enforcement by the ASA, including fines of up to 10% of annual global turnover. The CAP Code also requires marketing communications to be obviously identifiable as advertising, with both brands and influencers potentially responsible for non-compliance. Where content includes a price, discount code or other invitation to purchase, the total price and any key conditions must be clear and not misleading. In practice, businesses should ensure contracts require compliance with consumer protection law and CMA/ASA guidance and should expect co-operation from the agency or influencer if a complaint arises.

3. The contracts

The main issues are broadly the same whether your business is instructing an agency or an influencer, and so the contract should define the services, approval rights, fees, performance expectations, intellectual property rights, and non-compliance (amongst the other usual things found in commercial contracts!).

In addition, the contract should reflect the practical realities of modern advertising, especially where campaigns move quickly and have a potentially wide reach. Here are some tips to consider:

a) Deliverables

Deliverables should be described precisely, including the type of campaign, timing, channels and, for influencer work, the number and nature of posts. The contract should also explain how content is submitted for approval and whether performance will be measured by reach, engagement, conversions, or other metrics.

b) Regulatory compliance

Because brands can be directly liable for misleading or unlawful promotions, the contract should require compliance with the CAP Code, the DMCCA 2024, and any other relevant consumer protection rules. It should also make clear when labels such as #ad or “Advert” must be used and require evidence of compliance if requested.

c) Termination rights

Businesses often want the right to terminate immediately if advertising rules are broken or if the agency or influencer behaves in a way that may damage the brand’s reputation. This is particularly relevant for influencer campaigns, where controversy can escalate quickly.

d) Intellectual property rights

The contract should state who owns the content created under the engagement and what type of licensing rights apply if either party wants to re-use posts, images or video. If the campaign involves use of names, likenesses, or trade marks, the necessary permissions should be set out too.

e) Fees, payment, and performance

Payment terms should set out the fee model clearly, whether that is a fixed fee, pay-per-post arrangement, or incentive-based structure. It is also a good idea to address expenses, non-performance, and any right to reduce or recover fees if agreed outputs are not delivered.

f) Due diligence and ongoing monitoring

Before engagement, businesses may want to review previous campaigns or any history of regulatory issues. The contract can support this by allowing reasonable compliance checks or audit rights where appropriate.

g) Confidentiality and data use

Any use of consumer data must comply with data protection law, and extra care may be needed where campaigns target children, involve competitions, or use customer information in a particularly sensitive way.

4. Working with traditional marketing agencies and social media influencers in practice

In practice, contracts with agencies should also address media buying, commission arrangements, approval of media schedules, and protection of confidential information. If an agency uses influencers as part of its service, the contract should ensure that compliance, approval and intellectual property obligations flow down to those individuals.

Depending on the campaign, a business may also want a direct contract with the influencer so that it can enforce approval, compliance, and takedown rights without relying entirely on the agency. This can be especially important where the influencer is central to the campaign or presents a particular reputational risk.

Non-compliant campaigns can lead to fines, adverse publicity, loss of consumer trust, and wider brand damage. For that reason, contracts should require prompt notification of regulatory complaints or investigations and, where possible, give the client sufficient control to respond quickly.

Where influencers are engaged, businesses should also prohibit fake reviews, misleading testimonials, and any other banned practices, and should reserve the right to require prompt removal of problematic content. 

If you’re thinking of engaging a traditional marketing agency or social media influencer to help advertise your business and are not sure about anything, please contact our Commercial, IP & Technology Team at: commercialtechnologygroup@fsp-law.com or visit our group page.