NEW YORK, United States — Eugenie Kim, a bi-coastal Korean American influencer, regularly shuffles between fashion-forward outfit shots and social justice posts on her Instagram page, which has almost 400,000 followers.
Although her followers might expect that Kim would quickly call out a brand for transgressions ranging from racism to homophobia, given what she calls her “spicy” take on issues, often she’s stuck in a legal bind that keeps her from speaking out.
“With a normal influencer contract, [brands] can terminate us at any time if we do something that they don’t like … whatever it is that goes against their brand values, which I understand, but it should be a two-way street,” Kim said, referring to the often-lopsided brand contracts influencers sign that keep talent from publicly disparaging the company. “A lot of contracts don’t give us that power, and even when I wanted so badly to call out one of the brands that I already tried to call out nicely in person, they beat around the bush,” she added.
Between the coronavirus pandemic, the swelling Black Lives Matter movement, and evolution from cancel to accountability culture, brands caught in the callout vortex are sometimes putting their influencer partners in impossible positions, forced to choose between violating contract terms or risk losing face with their followers. The scales are still tipped in the brand’s favour, though talent and their teams are pushing for change.
In the past, a brand might have had the upper hand, retaining the ability to cancel a deal at any time or requiring an influencer to complete a social media campaign even if the brand was embroiled in some public relations nightmare. Now, it’s the talent themselves who are holding brands accountable for marketing snafus, internal organisational controversies and other actions that influencers and their management feel are misaligned with their own brands and underscore their work — or at least, trying to.
Reverse morals clauses act like a warranty.
“We’re not okay with putting our clients in a position in which they work with a company that, unbeknownst to them, is now coming into the public space with some sort of controversy or bad behaviour,” said Vanessa Flaherty, partner and executive vice president of influencer talent agency Digital Brand Architects. “The reason that has become much more of a hot button issue right now is because brands and companies are being called out for their bad behaviour on a much larger scale. Since the [Black Lives Matter] movement and Pay Up movement are now coming to light through social media, it’s even more imperative.”
Reverse morals clauses hold brands accountable
In June, when Black Lives Matter protests spread internationally, Nicolette Mason, a fashion influencer based in New York, said she cancelled campaigns with brands whose history of racial discrimination against Black influencers and shoppers in stores had emerged via social media, despite not having contract provisions in place to ensure she would be paid regardless. The cancellations offered an opportunity for Mason to speak to her management team at DBA about how she would be able to protect herself in the future.
“To drop a contract or cancel a contract because a brand has behaved badly or done something is really a big financial sacrifice for myself and for most talent, who are independent contractors,” Mason said.
As the influencer marketing industry evolves, talent and their representatives have begun to adopt contractual clauses that look a lot like a Hollywood actor’s contract with a movie studio. Moral clauses — those contract provisions that brands use to retain the right to cancel a partnership with an influencer if it feels they have acted offensively or have done something that may reflect poorly on the brand — are now being instituted in the opposition direction.
“Reverse morals clauses act like a warranty, help protect the reputation of creators and allow talent to terminate a deal without financial penalties or being in breach of their agreement,” said Qianna Smith Bruneteau, founder of the American Influencer Council, a not-for-profit trade group that offers educational resources to content creators. (In New York and California in particular, where many of fashion’s biggest influencer talent is based, implied morals clauses exist to protect both talent and brands.) “All these clauses support a need for both brands and influencers to safeguard their image, while also maintaining relevance in a volatile marketplace.”
At Brigade Talent, Founder and Chief Executive Max Stein said his team has started to consider reverse morals clauses to protect their talent roster, which includes fashion influencer Lyn Slater and Man Repeller founder Leandra Medine. In the past, Stein said, morals clauses used to encompass charges for a crime or convictions, as well as the public use of drugs, for example, though now the terms set by brands and talent have become much broader to encompass things like unsavoury social media comments.
“I have no problem with a brand only wanting to work with a spokesperson or a talent that they feel accurately represent their positioning and what they stand for and believe in, but I think the same is true of a lot of my clients,” Stein said.
Once-standard provisions are revisited
Including a non-disparagement clause in an influencer agreement has long been considered best practice in the industry, though the terms surrounding the clauses are shifting. Previously, a brand might expect talent to honour a non-disparagement provision long after a campaign rollout ends. Talent representatives told BoF this is another sticking point in contract negotiations.
At DBA, which specialises in managing high-profile influencers with millions of followers, the firm pushes back against clauses that have typically lasted one year or in perpetuity, freeing up a talent to speak freely should they choose to do so.
Before a brand ambassador goes public, however, talent representatives often try to communicate their grievances with a brand privately, at the very least to protect the business relationship.
What is the right balance of being able to support and endorse a brand and also needing to be making money?
“It’s always usually just a conversation with whoever is the brand’s [representative] or maybe even a CEO or CMO, whoever’s in charge over there,” said Ashley Villa, chief executive of digital management agency RARE Global. Villa said the conversations usually go something like, “Listen, we’re not aligned on your vision and we’re not going to be posting anymore for you until that’s either corrected or my client is comfortable.”
Other influencers have violated their contracts or terminated a campaign deal without clauses in place to protect them. Patrick Janelle, founder of talent management agency Untitled Secret, publicly pulled out of a deal of his own in 2019 with the high-end fitness club Equinox, after news surfaced that its owner, Stephen Ross, organised a fundraiser supporting the Trump reelection campaign.
“For more than one reason, it has been hard since these are opportunities that provide revenue [to influencers],” Janelle said. “There’s always a challenge for somebody in my shoes and in the creator space to be making judgment calls all the time on a number of different fronts, whether that is about what revenue looks like or what you need to be doing to make your business work. What is the right balance of being able to support and endorse a brand and also needing to be making money?”
From talent representative to bill collector
While influencer marketing has had to contend with issues of racial equality and social justice much like the fashion industry, the coronavirus pandemic and ensuing global economic recession have also complicated when and if brands — who may be dealing with everything from slashed marketing budgets to Chapter 11 bankruptcy filings — pay commissioned talent, influencer management executives said.
Since March, payment terms on various contracts have been pushed if the brand or talent has jointly decided to postpone a campaign that may appear tone-deaf, as was the case in June when Black Lives Matter protests spread internationally, DBA’s Flaherty said.
Meanwhile, other brands might not have formally ended their influencer deals (as was the case for several retailers who paused or ended affiliate marketing programs in March), but some have yet to pay talent for their completed work. Talent management agencies have had to devote time to acting as bill collectors, said Beca Alexander, founder and president of influencer marketing and management firm Socialyte.
“We’ve more had brands giving us really crazy payment schedules, where they owe us $10,000 and they say they’re going to be paying us $250 a week for the next 18 years… It’s insane.” Alexander said.
Rather than pursue legal action, a last resort for the Socialyte team, it entered into a lengthy, heated negotiation with a brand (it declined to name which) in order to seek payment.
Stein said that his team usually includes “pay or play” language in talent contracts, and often negotiates to have partial or in-full payment made upfront (something admittedly easier for talent with larger followings to negotiate).
Ultimately, influencer management teams say they would rather communicate with brands openly than enforce contract terms in court.
“It’s kind of a balancing act between what you know the contract says and [preserving] that long-term relationship,” Villa said.