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Influencer marketing agencies set to tweak contracts, educate influencers to comply with govt rules

Agencies handling top influencer talent have started working with legal teams to update and tweak contracts.

By  Saumya TewariJan 24, 2023 4:39 PM
Influencer marketing agencies set to tweak contracts, educate influencers to comply with govt rules
(From left to right: Influencers Mohammed Salim Khan (MSK) and Roshni Bhatia) The Indian Influencer market is expected to grow at a CAGR of 25 percent till 2025 to reach a size of Rs 2,200 crore. In a bid to comply with the government's new social media influencer norms and rules, agencies managing influencers have been conducting hygiene checks on contracts and educating their talent and marketers about the new rules.

Influencer marketing agencies have sprung into action after the Consumer Affairs Ministry released an exhaustive guideline for celebrities, influencers and virtual influencers on social media platforms last week.

The guidelines not only define who falls in the category of endorsers but also gives an in-depth understanding of how disclosures and disclaimers should be placed in any content put out by them on a public platform. A fine of Rs 10 lakh will be slapped on those who violate the rules and guidelines. The fine can go up to Rs 50 lakh for repeated offenders, the ministry said. The ministry also added that influencers can even be barred from endorsing products for up to six years in case of repeated non-compliance of the guidelines.

Storyboard18 reached out to influencer marketing agencies that have kickstarted the process of updating their contracts with influencers in compliance with the new norms.

Strict adherence, putting hygiene checks

Ritesh Ujjwal,co-founder and CEO of Kofluence says that in the coming month, the platform’s legal team will develop a clear and comprehensive set of internal policies and procedures for reviewing and approving all promotional materials before they are released to the public.

Kofluence works with influencers such as Danish Sait, Kiku Sarda, Chef Ranveer Brar, finfluencers Rachana Ranade and Pranjal Kamra.

“Through each step of executing and delivery of the campaign, we will verify the compliance of guidelines by each influencer/celebrity. The onus will ultimately be transferred to influencers/celebrities for complete adherence. However, for our brands, Kofluence will undertake such responsibilities as a part of basic hygiene check,” he notes.

Ujjwal thinks that adherence to these guidelines will not come in isolation but only with synergy between brands, creators and agencies and platforms that cater to the influencer marketing space. Now more than ever it is imperative to create a culture of collaboration that is rooted in trust and transparency.

“The Indian Influencer market is expected to grow at a compound annual growth rate (CAGR) of 25 percent till 2025 to reach a size of Rs 2,200 crore. But despite the booming growth, the industry still remains unorganised, fragmented and rife with inefficiency, trust and risk concerns. With these new sets of government mandates, I hope to see more unbiased opinions from our thought leaders, more ethical brand collaborations and responsible advertising which ultimately paves the way to a more evolved influencer ecosystem,” he adds.

Gautam Madhavan, CEO of Mad Influence states that the agency contracts include all the pointers that government has release on the public forum. The agency handles Roshni Walia, Daisy Shah, Jannat Zubair and Aadil Khan.

“Irrespective - the compliance team of Mad ensures all pointers are been taken seriously by the influencer. We have a brief document that we send alongside our proposal sharing that illustrates all the do's and dont's to the company,” he notes.

Delhi-based influencer marketing agency IPLIX Media, that handles influencers such as Saloni Gaur, Tech Burner (Shlok Srivastava), Mohammed Salim Khan (MSK) and Neha Doodles, will be issuing guidelines on how to comply in simple-to-understand terms and also ensuring that our creators understand the implications. More hygiene check will also be put into place to ensure compliance. Every new contract will include strict guidelines for clear disclosure and all relevant rules for brand associations.

“Ultimately our contracts will reflect a requirement to follow the new laws and the obligations and consequences of not followed. We have a legal team who are currently working on the terms to be added and will include all the recent changes in legislation by the government,” says Jag Chima, co-founder, IPLIX Media.

Education is key

Agencies are also working extensively on simplifying the rules for both creators and advertisers so that each party in the ecosystem makes an informed choice.

“Decoding and educating all the stakeholders will be a crucial step in implementing the new rules," shares Neel Gogia, co-founder, IPLIX Media. "We have already started working on this. The goal here would be to make all the stakeholders acquainted with the necessary requirements so we can all take an informed decision in the future that’ll benefit the brand as well as the industry.”

First Published on Jan 24, 2023 12:23 PM