Circular Marketing: The Future of FTC-Compliant Influencers

Hi, I’m Kaeya, co-founder and CEO of SwayID—the only influencer marketing solution on the market that can guarantee FTC Compliance (as of today, 8/30/2024).

Ever since landing a deal on Shark Tank at 19, I’ve been obsessed with the mechanics of virality. Influencer marketing, once seen as a golden ticket to success, is now losing its luster. Like smoking was once glamorized, influencer marketing has become the modern illusion of quick success—but it’s expensive, disingenuous, and increasingly ineffective. It’s time for a change.

The Influencer Marketing Reality Check: Beyond Regulatory Risk

• It’s Forced: Cold outreach, free products, and hefty payments for posts were never sustainable, leading to non-compliant practices under FTC influencer marketing regulations.
• It’s Unnatural: Posing with products influencers don’t actually use undermines customer trust and fails to meet FTC-compliant marketing standards.
• It’s a Gamble: The strategy often hinges on hoping the right person posts the right thing—akin to Russian Roulette, risking compliance violations.
• It’s Painfully Obvious: #ad or #sponsored tags don’t inspire action—they’re more likely to inspire scrolling past or blocking, increasing the compliance risk in influencer marketing.

A New Approach: Circular Marketing

I propose a shift to Circular Marketing—a self-sustaining, scalable model that empowers creators, from TikTokers to bloggers. Instead of paying influencers for posts, creator-consumers should earn exclusive, personalized discounts simply for being who they are—just like students, military, and healthcare workers do. In this case, it’s because brands appreciate that what these creators buy naturally shows up in their content. Posts featuring what they bought are completely organic, un-incentivized, and honest, aligning perfectly with FTC-compliant marketing strategies.

Disclosure: My company, SwayID, provides an out-of-the-box solution for brands to enable this approach.

Predictions:

• By 2027: Circular Marketing will be adopted by 80% of Fortune 500 companies. This shift will be evident in annual reports and marketing strategies, marking a new standard in FTC-compliant influencer marketing.
• By 2030: The number of paid TikTok posts will be halved, as detailed in company reports on marketing spend. This shift will highlight a move toward more authentic and sustainable marketing practices.

Will Influencer Marketing Vanish? No, But It Will Evolve.

Influencer marketing will evolve, with brands sourcing influencers from their pool of creator-consumers engaged in Circular Marketing campaigns. This new model will feature:

• Mutual Benefit: Influencer partnerships will be more sustainable, based on genuine interest and proven engagement, reducing compliance risk.
• Deeper Relationships: Brands will cultivate meaningful relationships with influencers genuinely invested in their products, ensuring FTC compliance.
• Sustainability: Combining Circular Marketing with evolved influencer partnerships will create a healthier ecosystem, where both brands and creators thrive.

Circular Marketing isn’t just the future—it’s the inevitable evolution. By 2030, brands that embrace this shift will lead the charge, setting new standards for efficiency, simplicity, and trust in FTC-compliant marketing.

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