The Hidden Risk in Social Media Marketing

This post is part of a series sponsored by Hanover Insurance Group Inc.

The explosive growth of digital marketing has encouraged companies to increasingly lean into social media as a way to reach their audiences. This has resulted in a flood of new social media ad content—and a lot of sharing music, imagery and pictures.

But who created that content? This is where a lot of companies, ramping up or creating their social media marketing strategies, tend to overlook a significant risk: the potential for copyright infringement. Media such as imagery, music and photography is intellectual property and is owned by its creator, who must grant permission if their work is being used. IP is generally defined to include a work or invention that is the result of creativity, such as a manuscript or a design, to which one has rights and for which one may apply for a patent, copyright, trademark, etc. Many social media posts include music and songs or pictures that may be the intellectual property of others; use without permission can lead to copyright infringement claims.

There is often a cost associated with the use of content that is owned by another person or entity —and additional, often significant, costs, if the unpermitted use results in a lawsuit.

This can be a tricky subject, and not just for social media novices. In one high-profile incident, pop star Katy Perry found herself facing a legal challenge in 2019 for posting a photo of herself on her Instagram page. What could possibly be wrong with that? It turns out that the photo was owned by the photographer who took the picture, who sued Perry for $150,000.

So, how can independent agents help their customers navigate the new world of social media marketing? By helping raise awareness for these risks. A good first step is to educate customers that IP risks should be reviewed for infringements and that they can lead to costly claims in the event of a violation of intellectual property.

Content owned by influencers
This matter is becoming further complicated as companies increasingly entrust social media content creation to outside “influencers.” A social media influencer is an individual who utilizes a variety of social media platforms to express their opinions on specific brands or products, thereby influencing their captive audience.

When an influencer shares images, music or videos on behalf of a company, the company assumes liability for the contents of that post. This includes any potential copyright infringement, and this is a major risk when working with influencers. According to a study published in 2020, only 14% of influencer posts sampled were fully compliant with copyright guidelines.[2]
And despite the fact that many instances of copyright infringement are often accidental, they can still be costly. Damages are often based on the number of instances of infringement, generally averaging between $750 to $30,000.

This is where agents can help business owners and leaders understand their responsibilities to ensure the content on their social media platforms is used in a compliant manner. Further, they need to understand that if content is being shared or leveraged from other sources, they must take the proper measures to obtain approval for use.

Help businesses avoid social media pitfalls
Social media marketing is a fast-growing, creative and evolving field. And, with a little diligence, there are simple steps companies can take to avoid copyright infringement. As an independent agent, you can offer two important tips to your clients on how to help avoid intellectual property violations and possibly steep financial costs.

1. It’s probably copyrighted. Assume that content such as songs, videos and images are protected by copyright — and never assume that the use will go unnoticed. To ask permission to use the content, businesses can try to locate the owner of the work (or performance rights organization, such as ASCAP or BMI) and receive permission. In the event permission isn’t obtained, the use of stock music and photography services – work offered for sale – is a convenient and cost-effective alternative. These are materials that can be purchased for use and others that are in the public domain and are free to use. These options require some research and represent an expense, but doing it upfront helps avoid an unexpected claim later.
2. Develop a social media policy. Agents can advise their clients to work with legal counsel to develop a social media policy to ensure all content creators—influencers and employees—understand the importance of maintaining compliance and document controls to protect the company. The policy, at a minimum, should specify roles and responsibilities, applicable regulations and legal risks, security risks, accountability, and how to report concerns.

Helping businesses understand the ever-evolving risks they face and the importance of taking a proactive approach to risk management enables businesses to prevent potential claims and highlights the value your agency delivers. To learn more about The Hanover’s risk management program offerings, visit hanover.com/risksolutions.