Negotiating Brand Deals, Dangerous Contract Terms, and Changes to Social Media that Affect Your Business
Episode 526: Show Notes
This is another one of those episodes where Abagail puts Emylee on the spot in front of the audience. She knows nothing and is expected to come up with something out of thin air. For context, we started our business as creative entrepreneurs and designers and all that. What we did not realize we were doing at the time was influencing people. We started this blog, we were putting out content, and ultimately, a large portion of our business has become what we would call affiliate marketing. It makes up a big percentage of what we are doing.
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Abagail has all this background knowledge of what it takes to be an influencer in an affiliate capacity and has made all of these pivots with her second brand to broaden the ways she is bringing in money for this brand. Emylee is admittedly the laziest influencer out there. It is not that she doesn’t influence people; she definitely does, and there are many examples to prove it. In technical terms, Abagail, based on the size of her audience, would be seen as a micro-influencer. There are so many people out there that want to be influencers but they don’t necessarily know what they need to be looking out for. There are some alarming things brands are starting to include in their contracts, and micro-influencers are agreeing to these things, most probably without any idea of what they actually mean. And they could not only negatively impact your business, but they could destroy your online reputation if you do not pay attention to what is going on.
The Dangers of Whitelisting
So, the first time Abagail heard of whitelisting was when it was about software. In the email context, it would have to do with approving. When it comes to software, you can remove the original branding and replace it with yours. Oftentimes, you see this when you take a course, and you pay a high enough fee so you can use the materials for your brand. However, the danger with whitelisting in the influencer community comes when it is a cover for what is called black advertising. We guarantee that you have seen this, and it has probably confused you. Say you see an advert on Instagram or Facebook for a specific product. But if you look in the corner, the ad does not come from the brand it is associated with. So, essentially, what influencers agree to with whitelisting is giving brands access to the entire backend of their social media accounts. How, you might ask? Well, it’s a built-in feature Instagram rolled out. On top of that, they can also get into your account, post as you, hide adverts from you on your feed, and take away your ability to moderate comments on these posts. While this happens across the board, it is particularly in the micro-influencer community. So, maybe you think that something is a great opportunity for exposure, but guess what? You are not getting paid at all! The fact that you cannot moderate is also dangerous because if the post is pulling in sales, there is no reason for a company to intervene with what people are saying. From the outside, it might seem like this is an affiliate-type relationship, but it rarely ever is. It is not to say you cannot agree to whitelisting. If you do, you have to be compensated for it on a specific timeframe. There is no reason to give a brand the rights to your content forever!
Understanding Usage Rights
We are so happy that the conversation around content creation for bigger brands is happening. You essentially take on the role of creative director, photographer, stylist. Always remain aware of how much work you are putting in when you agree to a partnership. This is why Emylee has no interest in working as an influencer; it is way too much work for not enough reward! But, if you choose to get into a deal structure like this, we recommend that you charge 100% of your rate for every 30 days a brand uses your content. So, what’s the deal with usage rights as an influencer? Maybe you think that it does not matter what the usage rights are when it comes to the content you have created, but it has value to the brand! For them to recreate it, they would have to hire equipment, a studio, props, and stylists. So, either you get compensated fairly, or you negotiate the usage rights very carefully. Remember, people have to know, like, and trust you, so when you endorse a product that directly affects your reputation, and so, think extremely carefully about who you choose to work with.
The Importance of Transparency in the Influencer Community
Recently, Abagail hired a painter to paint her house, and because he did a really great job, she referred him to other people. Since then, he has gotten thousands of dollars of work, all without Abagail sharing his name or company on her social media. So, just imagine how quickly things can snowball if you have personally endorsed a brand! Emylee bought a couch and shared the brand on her Instagram, and at least two people bought sofas from the same company just because she had bought one! This is why it is so important for influencers to be transparent about the nature of the contracts they enter into with brands because when they are opaque, brands can take serious advantage of them. Even though Facebook and Instagram have rolled out ads, brands know that they do not work as well as endorsements from influencers, which is why they want a piece of the pie. Because brands understand that the influencer landscape is growing, they can move onto a different person if a particular influencer is too expensive. There are obviously brands that are willing to negotiate with you. But others will just move on, and you should be grateful they did. Brands may dupe you into believing that because your audience is small, you are not as valuable, but we are here to set the record straight. When you have a small, engaged audience, your conversion right is pretty incredible! Abagail has consistently had under 4000 followers, yet she did over six figures in sales for one brand! She has chosen to walk away because she is not making enough for how much effort she has to put in.
Exclusivity Rights and Knowing When to Walk Away
When brands negotiate with you, they use all this sexy language, yet when the contract gets delivered, there are all these other terms and conditions snuck in. So, even though you have mentally agreed to the contract, you now have to back up. Exclusivity rights are another one of these clauses you should look out for when entering an agreement with a brand. This is because it may prohibit you from working with related brands for a certain amount of time. Sometimes, this makes sense, but it can really constrain you, especially when they sneak in items that the brand does not even sell! You may agree to exclusivity rights for the main products, but it is generally a bad idea to agree to them for related items because you just don’t know what can pop up in your life. Some brands are putting in exclusivity clauses that last up to a year! That is absolute madness. If, for some reason, you are okay with this, then brands better pay you a pretty penny because you are saying no to a variety of other things. Usually, you are so far into the negotiation by the time you see these terms, but that doesn’t mean you have to agree to them. You can always, always say no. Remember, the person that is able to walk away holds the power, so if something does not sit right with you and a brand is not willing to hear you out, keep moving! Know your boundaries and what you will not do. You never know what saying no can lead to, which is why it is important to stick to your guns. Brands who add on terms once you have agreed are a big red flag from us.
The Pinterest Change that Undermines Creators
There is a big change happening on Pinterest. You know we love the platform. They have done a ton for our business. However, if they follow through with this change, we think it can be damaging for the entire influencer industry. So, you go on Pinterest, enter your search, and the pins appear. In addition to the regular ones, there are now these other ones with dots hovering above them that give you the option to buy that particular product. For users, this sounds amazing, but creators do not make anything from the image they have created! Most likely, the content creators have the link to the product on their website, and by clicking from Pinterest, the creator gets none of the traffic. While the products Pinterest recommends are similar, they are not always the same, and if you are in the handmade space, this new feature will mean that customers simply bypass your product. There are so many issues that come with this change on the platform. We do think there is enough potential pushback that this change might not happen. From the user side, this change makes sense because there are so many times we have seen cute things we didn’t know how to buy, but the way it might be implemented is not fair to the creators who work so hard. All of the things we have spoken to about today are risks that can cost your business thousands of dollars, so think really carefully about what you agree to. Read your contracts, know your worth, know when to walk away, and keep on top of changes happening on these platforms because if you are a creator, they absolutely affect you!
Quote This
If a bigger brand wants to work with you, to create content, you need to think about all of the work you are going to put into that content.
ON TODAY’S SHOW
Abagail & Emylee
The Strategy Hour Podcast
We help overwhelmed and creative entrepreneurs break down their Oprah-sized dreams to create a functioning command center to tame the chaos of their business. Basically, we think you’re totally bomb diggity, we’re about to uplevel the shiz out of your business.
KEY TOPICS
Micro-influencers, Influencers, Brand Partnerships, Whitelisting, Usage Rights, Exclusivity Rights, Collaboration, Content Creation, Instagram, Facebook, Pinterest Changes
