The Definitive Guide to Negotiating Brand Partnerships for Creators: Part III— Content Licensing & Usage
This is part three of a nine part series for creators who want to improve their hand when negotiating brand partnerships. If you tuned in for part one, Exclusivity & Monetizing Opportunity Cost, or part two, Demystifying Content Boosting, Licensing (Whitelisting), & more, free to skip the intro and dive right in.
Introduction for the unacquainted
The saying knowledge is power holds true for every profession and industry. Any power disparity in professional partnerships can and will be exploited to the detriment of the party with lesser knowledge.
Having worked with social content creators for the past 5 years, I have seen this dynamic on full display. Influencers who negotiate for themselves unknowingly make concessions leaving huge amounts of revenue on the table.
On the other hand, creators who put this knowledge into practice thrive. The secret to their success isn’t working harder. It doesn’t require more followers or producing more content.
It’s quite simple: as a creator, if you want to earn more income from brand partnerships, you need to negotiate from a position of strength, with a full understanding of the meaning, implications, and value of specific conditions of your contracts.
You do not need a lawyer or a talent agent to utilize the knowledge any of these terms. However, if you are not aware of them, you are likely earning less than half of what you could be as a creator.
Having reviewed thousands of brand partnership contracts for creators and spent time on both sides of the negotiation table, I’d like to share a guide to the secrets that have enabled creators to double their brand partnership earnings almost overnight.
In part III of this guide, we’ll focus on “Content Licensing” and “Usage Rights”, two of the least understood and perhaps most consequential terms in brand partnership agreements. We’ll cover what each of these terms means, why they are important, and how to negotiate them.
Disclaimer: the following is not legal advice, nor should it be used to replace the guidance of certified legal, tax, or accounting professionals.
Content Licensing and Usage
Estimated increase to contract value: +10–100% (or more)
What it means:
Although (Instagram) Licensing and Dark-posting give your clients the ability to share and promote their products through your content on Instagram, what about other media platforms and channels? Content licensing and usage terms determine how your content can be used and by whom.
Licensing defines the “where” by specifying permitted media channels and platforms (social media, online promotion, print, etc.) and sometimes authorized countries as well (United States, Canada, etc.) though “global” licenses are the most common given the reach of social media.
“Usage” answers the questions: who can use this content, what can they do with it, and for how long?
Why it’s important:
From my experience, Licensing and Usage are the most often overlooked opportunities for creators during contract negotiations. Licensing and utilizing your content beyond social media is a huge value-driver for brands, and something typically carried to an extreme in many client legal templates.
I have personally seen the ramifications of overlooking these terms and it’s not pretty. Take this case as a precautionary tale:
An influencer was just getting started on TikTok and offered a $300 contract to make a video for a nationally-recognized brand. When inquiring about the contract’s licensing and usage terms, her client contact confirmed that her content would be used exclusively on TikTok. It was a settled matter.
Nearly 6-months later, this creator started receiving messages from her community members congratulating her for making it into a television ad that was broadcast across the country.
How could this happen?
A second review of the contract revealed that the creator had unknowingly granted the brand unlimited and perpetual rights to license and use her content.
All of this was hidden in the fine print of the agreement, despite being verbally contradicted by the brand’s contact.
The questionable ethics (and legality) of this brand’s practices aside, this was a missed opportunity for the creator to earn thousands — if not tens of thousands — in additional revenue.
The lesson here: you are leaving multiples of your current revenue on the table if you’re not negotiating licensing usage terms for your content.
How to negotiate it:
Four primary variables that can be negotiated regarding Licensing and Usage:
Media Platforms and Channels are the most important. Simply put, the more places a client can use your content, the more you should be charging. While usage across social media is standard, if a brand wants to use your content to bolster its online presence (catalog, newsletters, website, or other web properties), you should add roughly 20–60% of what you charge for a single post to your total fees. The more extensive the digital usage, the higher within that range you should go.
For licensed usage across anything non-digital, your rates should go much higher. Here’s a key to give you an approximate range:
- Print (ex: magazine, newspaper, direct mail, etc.) — 200–400%
- Out-of-Home (ex: billboards, in-store, etc.) — 1000–3000%
- Television (ex: linear TV, cable, terrestrial, over-the-top) — 1000–5000%.
Influencer Beware: most influencer marketplaces will offer “click-to-sign” agreements that give your client unlimited license and usage of your content. Avoid dealing through these platforms as much as you can.
Duration determines how long the client can use your content. This is the easiest. The longer the client can use your content, the more you should charge.
Pro-tip: many client contracts will start with “perpetual” usage, meaning your client can use your content indefinitely. Never accept “perpetual” usage unless getting paid a 3–5x multiple of what you earn from a single post.
Modification rights give your client the ability to make changes to your content when using it. Modifications may be as simple as cutting your 60-second video into four 15-second clips, or taking a portion of your video and placing it into other promotional content.
When negotiating modification rights, the most important thing for you is to require that your client get your permission for any of these edits or changes. The last thing you want is for your content to show up in a context that misrepresents your message or is inconsistent with your brand. Once secured, you should charge an additional 20–50% fee to what you charge for a single post.
Additional party authorization may be included in your agreement if your client needs to deliver content licensing or usage rights to any 3rd-party (oftentimes a brand or agency client). While this is normal for an agency client to require (after all, it’s their brand client who is utilizing your content), it is not common to have additional party authorization beyond those directly involved in the campaign. If additional parties are referred to in ambiguous language, you should require that they are specified to avoid giving away rights to anyone you are unfamiliar with.
In closing:
Do you have experience negotiating content licensing or usage rights as a creator or brand? What do you think are some of the most common mistakes creators make when negotiating these terms? Whether or not you enjoyed this post, I’d love to hear about it.
Share your thoughts in the comments below.
In part IV, we will look into how applying charges for content re-shoots and revisions can save you time and help you earn more income from particularly difficult clients.
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