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Everything You Need to Know about B2B Influencer Contracts and Payments

In today’s market, you’ll be hard-pressed to find an avenue of marketing that’s both free and effective. Despite what some might lead you to believe, B2B influencers will expect more than brand exposure in exchange for their services. 

Unlike B2C influencer marketing, B2B agencies and brands often cannot offer products in exchange for their work — not because of any rules, but because their offerings are simply not meant for individual consumers. Can you imagine asking someone to write a blog post in exchange for … cloud storage? Yeah, neither can we. 

That brings us to the all-important subject of influencer agreements, now commonplace in today’s influencer marketplace.

Why do I need an influencer agreement?

An influencer contract, also known as an influencer agreement or influencer marketing agreement, is a legally binding document between a company or brand and an influencer. This contract outlines the terms and conditions of the partnership and sets clear expectations for both parties.

If you’re in the United States and you’re interested in onboarding influencers for your marketing program, you must familiarize yourself with the regulations set by the FTC (Federal Trade Commission). These, of course, exist to safeguard consumers against false advertising. That’s why it’s so important that the drafted agreement makes it clear that there’s a material connection between the brand and the influencer. But what else should the agreement include?

What should an influencer agreement include?

  • Parties Involved: The names and details of the company/brand and the influencer.
  • Scope of Work: A detailed description of the campaign, including the specific deliverables (e.g., posts, stories, videos), platforms to be used (e.g., LinkedIn, Instagram, YouTube), and the content requirements.
  • Compensation: Information on how the influencer will be paid, including any fees, bonuses, and reimbursement for expenses. This section may also cover the payment schedule.
  • Timeline and Deadlines: Important dates for content submission, posting schedules, and the duration of the partnership.
  • Content Guidelines: Brand guidelines and creative direction to ensure the content aligns with the brand’s image and values. This might include style, tone, hashtags, and other branding elements.
  • Approval Process: Procedures for content review and approval before it goes live. This can include deadlines for the brand to review and request changes.
  • Usage Rights: Terms regarding the ownership and use of the content created by the influencer. This often covers how long the brand can use the content, in what contexts, and whether the influencer retains any rights.
  • Exclusivity: Clauses that prevent the influencer from working with competing brands during and sometimes after the contract period.
  • Compliance and Disclosure: Requirements for adhering to relevant laws and regulations, such as FTC guidelines for sponsored content disclosure.
  • Termination Clause: Conditions under which either party can terminate the agreement and any notice period required.
  • Confidentiality: Provisions for maintaining the confidentiality of any sensitive information shared between the parties.
  • Indemnification and Liability: Clauses that protect each party from certain legal liabilities and outline the responsibilities in case of breaches or disputes.
  • Miscellaneous Provisions: Any other terms and conditions relevant to the partnership, such as amendments to the contract, governing law, and dispute resolution methods.

While every contract will have its differences, they’ll always have the same purpose: to set expectations between the parties and reduce the risk of misunderstandings or legal woes.

Do lawyers need to get involved?

Today, handshake deals just don’t cut it. Careful legal review of agreements must be conducted to ensure all parties are protected and satisfied. In B2B influencer marketing, it’s standard practice to have the brand or the agency representing the brand draft the influencer agreement.

Once the agreement is drafted, it’s up to the influencer or their agency to review the document in its entirety. In some cases, the sender of the document may take the time to walk through the document with the influencer to once again review the specific terms of the agreement to ensure everyone is on the same page. While it may seem straightforward, influencers need to take the review a step further by forwarding the documents to their legal counsel to check for non-obvious issues, including ambiguities, incomplete provisions, punctuation, and undefined terms.

Influencer payment models to choose from

B2B marketers tend to pay influencers via three unique payment models. The one you choose will depend on several factors, including scope, budget, and campaign goals.

  • Flat Fee: A fixed amount for specific deliverables (e.g., blog post, event attendance, podcast).
  • Performance-Based: Payment is dependent on the success of the campaign (e.g., clicks, engagements, conversion rates).
  • Retainers: Regular, ongoing payments for a series of activities or continuous collaboration over a period.

Deciding on payment form for influencers

Unfortunately, in the world of B2B marketing, distributing payments usually isn’t as simple as using an app like Venmo or CashApp. To ensure payments are protected and processed correctly, we recommend using bank transfers. That said, there are several alternative payment options available to accommodate all parties:

  • Check: Yes, there are still plenty of folks who don’t mind waiting for a physical form of payment. Sometimes you can’t beat what’s familiar.
  • Payment Platforms: Services like Bill.com automate invoicing, bill payments, and international payments.
  • Affiliate Platforms: Consider ShareASale or Commission Junction for performance-based compensation.

Creating a payment process for influencers

In B2B marketing, the most common way to initiate payments is through invoicing. These can be submitted through email, a dedicated portal, or your preferred accounting software. To ensure there are no delays in the processing of payments, ensure your contracted influencers provide — at a minimum — the following information on the invoice: Name, company name, address, services rendered, payment amount, invoice number, and due date. Note this is a great time to ask your influencer for a W-9 so you can report payments to the IRS.

Scheduling, approving, and processing influencer payments

If done correctly, the payment schedule should be outlined in the agreement. Most often, payments are distributed weekly, bi-weekly, monthly, or upon completion of all services. Take time to remind your influencers of the agreed-upon payment terms throughout the process. Much like everyone else, these are busy professionals who can lose track of timelines. 

The approval process will vary depending on the contracting entity. Usually, brands and agencies will have an internal review workflow in place, where several groups of personnel review the influencer deliverables to ensure the full scope of the agreement is met. Most often, the buck stops with a finance manager, who will take final ownership of the review and distribute payment.

After the deliverables have been reviewed and approved, the finance manager or designated personnel will initiate the payment. We recommend using software such as Bill.com, Xero, or FreshBooks to efficiently manage and automate this process. Additionally, some influencer management tools, like Klear, offer integrated payment processing capabilities through third-party vendors, which could further streamline your workflow.

For record-keeping and customer service purposes, agencies and brands should send payment confirmation emails once payments are processed. Be sure to include details of the payment amount, method, and expected arrival time.

Overwhelmed with the thought of handling influencer contracts and payments?

Identifying influencers, nurturing them, conducting outreach, developing a strategy, and co-developing content is already an arduous list of tasks. Add in the process of influencer contracts and payments, and you have a whole lot of work on your hands. That’s where we come in. We’ve been handling the ever-evolving process of influencer marketing payments and contracts for nearly 20 years. Ask us about our B2B Influencer Marketing services today.

The post Everything You Need to Know about B2B Influencer Contracts and Payments appeared first on TopRank® Marketing.

July 3, 2024

Original Source https://www.toprankmarketing.com/blog/influencer-contracts-payments-faq/

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