In recent times, most companies often rely on brand ambassadors to help promote their products or services. While this can happen naturally, sometimes the brand ambassador is paid through an ex-deal, products, or actual monetary stipends. Moreover, when there is value behind the brand ambassador, a contract helps protect both the contractor and the company using their services.
It is important that companies or brands discuss about the importance of publicity. Starting up with a Brand Ambassador Contract through brainstorming with a great marketing team and making sure this document is written legally will definitely help the prospected ambassador know what the company offers.
A Brand Ambassador Agreement is a legally binding written agreement between a brand or company and a brand ambassador in which the former appoints brand ambassadors to promote its products and services through several platforms or channels. This is also known as an influencer contract. This agreement is used by the companies who want to appoint the brand ambassador to legalize their relationship in connection with the promotion of the brand’s products and services. It formalizes and defines the relationship between a brand and a brand ambassador. It mainly stipulates that the brand ambassador will act as the brand’s representative concerning the promotion and sales of the brand’s product.
In addition, the brand ambassador contract is a proof that the ambassador acts as the company’s representative in connection with the promotion and sale of the company products. The ambassador will perform services in relation to the company, like engaging with the company’s social channels. It should also state the Ambassador’s duties and restrictions in performing the Company’s marketing purposes. Moreover, the company is also obliged to perform services to help and assist the Ambassador. Lastly, the compensation details—including the commission amount and the payment methods, are clarified.
Brand Ambassador Contract helps in protecting the legal rights and interests of both the contracting parties by serving as a legal record and valid proof in the event of any possible disputes or differences that may arise in future relating to the contract. Brand ambassadors have to take a big role in advertising or promoting the brand. They have to actively work on promoting the brand to its potential customers or audience. An effective brand ambassador agreement helps in properly presenting and limiting the work of the brand ambassador, which the brand owner expects from him or her. Hence, a brand may choose to have a long-term relationship with a brand ambassador owing to the benefits arising from it. Like most contracts, it helps in reassuring the parties that their contractual relationship will be carried out as agreed by them. Apart from being enforceable in a court of law it also adds to building the credibility and legitimacy of both parties.
A brand ambassador is a popular person hired by a company or an organization whose purpose is to represent a certain brand and its products for the purpose of increasing brand awareness and sales of a product. The brand ambassador is meant to show emphasis on the company image in personifying its values and ethics, as one who is obligated to be the embodiment of a brand for the purpose of projecting a positive company image.
Brand ambassadors do the vital marketing work, but they also need to protect themselves and their careers. These clauses will help:
Most brand ambassadorship agreements are generally drafted more in favor of a company appointing brand ambassadors. So, while drafting or reviewing the brand ambassadorship agreement for a celebrity the drafter should keep in mind the rights and interests of the personality on a priority basis. The public personality also has his or her reputation and influence in society. Any clash or disputes between them in a contractual period may affect his or her fame which can greatly affect a personality’s career in the long term. Clauses involving rights or duties of parties and force majeure need to be given due attention while drafting or reviewing such agreements for protecting the interest of public figures.
The following are the clauses that can be included in the Brand Ambassador Agreement:
Give a proper title to your contract. There are no further types in brand ambassadorship agreement hence, one can give a title like “Brand Ambassadorship Agreement” or “Brand Ambassador Contract”.
Identify and state both the parties in detail. Include their names, official address and other necessary information like in any other contract.
This clause describes or states the appointment of a brand ambassador by the company or brand. Appointment of Brand Ambassador: the company hereby appoints the ambassador as its exclusive or non-exclusive brand ambassador on the terms and conditions set forth in this agreement for the term of 3 (three) years.
List out all the services and duties the Brand Ambassador has to perform which the parties in agreement have mutually decided. State each service clearly. The drafter can even make a separate schedule describing the services of the Brand Ambassador in detail. Scope of Services: during the term of this agreement the ambassador shall serve as the company’s brand ambassador, endorser and spokesperson. He shall provide the service associated with such roles for the company. The services shall include, but not limited to the items listed in schedule.
Companies will put some restrictions, which may have a bad effect on their business, on the activities of brand ambassadors while performing his or her contractual duties. Include all of them in the agreement.
Add the clauses specifying the rights of both parties.
Brand ambassadorship agreement also involves the appointed celebrity’s reputation as well. Hence, the duties of a company should be properly described to keep a balance between the parties and to safeguard the celebrity’s interest. Timely assistance to be given to the brand ambassador to perform his or her duties, providing equipment to the brand ambassador, timely payment, etc. The drafter can include them separately in representation and warranties clauses as well.
Include or state the compensation clearly given to the brand ambassador by the company for his performance under a consideration clause. Make sure to write the compensation amount in words as well. A contract must be clear when it comes to compensation in agreement to avoid further confrontation between the parties. The mode of payment, the due date of payment and penalty for late payment should be incorporated in it as well to make it exhaustive. The company shall pay the ambassador commission equal to 5% per cent of the profits generated by the company on an annual basis. The other thing could be, in consideration of the obligation undertaken by the ambassador, the company shall pay upon the fulfilment of duties and obligations of the brand ambassador.
In case the company has to share secretive or highly confidential information with the brand ambassador then, it is highly recommended to include confidential clauses. This will make sure that the sensitive information of the company remains secure. If there is a high level of confidential information then a separate confidentiality agreement is recommended.
This clause describes the relationship between a company appointing a brand ambassador and the brand ambassador. It can be drafted the ambassador is an independent contractor or the relationship between the parties to this agreement shall not be construed to be that of partnership, joint venture, employer-employee or agency of any kind.
The company or brand may want to include an exclusivity clause or non-compete and non-solicitation clause to restrict the brand ambassador from communicating with the company’s employees, directly or indirectly and simultaneously promoting other rival companies. While negotiating on this part, make sure to keep the period of non-compete and non-solicitation period to its minimum so that it won’t affect the celebrity in the long term.
Non-competition would mean the ambassador shall not promote, represent, sell, or distribute any products that are similar to the company’s products, either directly or indirectly, during the term of this agreement and for a period of 14 months after the termination of this agreement. Meanwhile, non-solicitation means the ambassador will not solicit or communicate with the people in connection with the company, either directly or indirectly.
List out all the details regarding the company’s products and services which the brand ambassador has to undertake for promotion. A separate schedule added to the agreement is more preferred for this purpose.
As appointing a celebrity as a brand ambassador involves high costs, an effective dispute resolution clause becomes important to include. Include the details on how to handle a breach, who will pay the legal fees in the process, methods of resolution process before approaching courts (arbitration, litigation, or mediation) etc.
At last draft all the boilerplate clauses such as term and termination clause, notice, assignment clause, severability, indemnity clause, force majeure, governing law, etc. Even though they are present in almost all types of contracts they may vary depending on the situation or needs of parties involved in the agreement. Make sure that they should be tailored to suit the needs of celebrities.
There is no comprehensive law for regulating and monitoring misleading advertisements by celebrities. However, there are Advertising Standards Council Code that provides certain guidelines for celebrities in this regard. According to the said code, the celebrities are expected to have knowledge of this code while doing advertisements. Even though this code does not provide any penalties, according to Section 21 of the Consumer Protection Act (CPA) 2019, a celebrity can be held liable and penalized for misleading advertisements. The Central Authority formed under CPA, 2019 can impose a penalty that extends to a big amount for every subsequent breach. Hence, apart from above the clauses, a compliance clause to this effect should be added in the brand ambassadorship agreement.
When making your brand ambassador contract, make sure you do not make mistakes like failing to put a term or termination clause into the contract. You need a way out of the agreement at some point. Do not fail to address FTC requirements. Brand ambassadors must disclose that they are being paid for their advertisement, so put that fact in your contract.
A brand ambassador contract outlines the duties that a brand ambassador is required to perform for the entire duration of the contract, which can normally go on for months. If a brand ambassador cannot perform a duty for some reason in the future, it may call for penalties. The contract gives little flexibility to companies who might want to alter their marketing strategy in the future with changing marketing trends. The brand ambassador might charge an additional fee for changes in the agreement.
While brand ambassadors can be paid for their work, there are many who will represent your company for free, just because they’re excited about it. That being said, if you do not pay your brand ambassadors, make sure they have access to product at no cost and any other perks you can throw their way.
You must be able to engage potential customers during special events. You must also be able to reach out through social media and online content as a trusted brand advocate and expert. In other words, you should be a really smooth talker, a creative and intelligent writer.
Popular and legitimate brand ambassadors are able to offer many benefits, with the most essential being the ability to give your brand a boost on social media, spread positive messages, and definitely influence consumer sales. The most effective are those who are able to provide customer service and act as the speaker for your company or brand.
Having a brand ambassador is an amazing idea to promote a company or a product. In order to facilitate the working relationship between a brand ambassador and a company, a brand ambassador contract is of supreme importance. Contracts may be hard to create but if one has extensive legal knowledge, it can still be done in no time.
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